Posted October 1st, 2012 ~By Scissortail Financial
We have just received notification from the Office of Native American Programs that a moratorium has been placed on all refinance transactions and will no longer be issuing case numbers on most refinance transactions. The reason for this action is that HUD as well as the entire federal government is currently funded under a continuing resolution which caps government spending at 2012 levels. The current continuing resolution funds the government through March 27,2013. The Office of Loan Guarantee is taking what they believe to be the necessary steps in order to responsibly manage the loan guarantee fund during the continuing resolution and one of those tough choices is to enact a moratorium on fee simple refinance transactions.
Thus, until further notice the Section 184 program will only issue case numbers for refinance loans (a) Occurring on tribal and individual trust land; and (b) Occurring at the completion of a construction loan on fee, tribal and individual trust land.
The Section 184 program will not issue case numbers for any other type of refinance transaction.
The policy outlined in this notification will remain in effect until Congress has passed and the President has signed the HUD budget for the remainder of fiscal year 2013. At that time HUD will reevaluate whether or not the Section 184 program can again guarantee refinance transactions on fee simple land. HUD assures us that the moment this moratorium on refinance transactions is determined to no longer be necessary it will be lifted and you will be notified immediately.
The Office of Loan Guarantee realizes that these developments are not ideal for many of you and they sincerely apologize for the inconvenience and frustration that this might cause for you, but all of these decisions are being made to ensure the long term viability of the Section 184 program. As always, The Office of Loan Guarantee appreciates you and they look forward to continue working with you to help serve Indian Country.Return