Lending rates to American Indians and Alaska Natives fell nearly 5 percent last year even as loans to other racial and ethnic groups increased, according to newly released data.

Financial institutions extended 17,850 home purchase loans to Native Americans in 2003. While this was a a 50 percent improvement from loan rates a decade ago, it represented a 4.8 percent drop from 2002 and a 31.7 percent drop from 1999.

At the same time, home purchase loans increased 11 percent for Whites, 15 percent for African-Americans, 16 percent for Asians and 18 percent for Hispanics.

The data was contained in an annual report from the Federal Financial Institutions Examination Council, an interagency entity. As required by federal law, the council must provide information on home mortgages nationwide.

The report, released July 26, did not explain why loans for Native Americans have fallen in recent years. But leaders of the National American Indian Housing Council, a non-profit organization, said lenders should do more for Indian Country.

"Lenders and policy makers need to step up their efforts in eliminating the barriers and inequalities faced by Native people to create a friendly and fair lending environment," said Gary L. Gordon, the group's executive director.

Chester Carl, NAIHC chairman, said the rapid growth of the Native population only means that demand for homes will increase. According to the 2000 U.S. Census, American Indians and Alaska Natives experienced a 26 percent surge in numbers in the past decade.

"This confirms that in a time of population growth in Indian country, along with the coming-of-age of Native homebuyers, we are witnessing a decline, showing that discrimination is still strong and exists against the Native population," said Carl, the housing director for the Navajo Nation, the country's largest tribe.

The data also showed that Native Americans were denied loans more often than every racial and ethnic group except African-Americans. Last year, 24 percent of Natives were denied home purchase loans, a slight increase from 2002.

When analyzed by income level, Native Americans who made less than $50,000 annual were denied 36 percent of the time, the highest of any group. In comparison, only 17 percent of Asian and 22 percent of White applicants at the same income level were denied.

In the $50,000-$79,000 income range, Native Americans were denied at a rate of nearly 24 percent. In comparison, only 12 percent of Asian and White applicants were denied.

According to government statistics, only 33 percent of Native Americans own homes, less than half the national rate and far lower than homeownership rates for other minority groups.

To change that, NAIHC in February launched an initiative to raise $10 million for the "Housing First for First Americans" campaign. Fannie Mae, a private company that provided $290 million in financing last year to help Indian families become homeowners, donated $1 million to kickstart the effort.

Composed of 19 separate initiatives, the campaign will help tribal housing staff expand their training, communications, research and assistance; promote homeownership and reputable lenders; fight predatory lending; develop partnerships; and establish national and regional Indian housing centers. A web site for Native homebuyers is also in the works.

Get the Data:
Summary Tables | Nationwide Summary Statistics for 2003 Home Mortgage Disclosure Act Data

Relevant Links:
National American Indian Housing Council - http://naihc.net