Union State Bank of Hazen has made the first-ever home loan to a family living on tribal trust land in North Dakota.

The loan paves the way for more like it, now that the bank has cleared the obstacle of financing a home loan when the land is not owned by the individual.

The loan is the first of its kind on any reservation in North Dakota, South Dakota and Montana, Sherry Schatz, mortgage loan officer for Union State Bank, said.

Jane Martin, spokeswoman for the Turtle Mountain Indian Reservation Housing Authority, said many tribal members haven't been able to become homeowners because most of the land is owned by the tribe.

Under normal circumstances, the land on which the house sits is part of the loan security.

"Now, they've paved the way for banks to come in and do home financing," Martin said.

She said several other tribal members are working with Union State Bank on home financing applications.

Martin said there are 1,000 people who need housing on the reservation and the option of being able to borrow and either buy or build on trust land should help alleviate the housing crunch.

In lieu of land security, a signed resolution between the tribe and the federal Housing and Urban Development provides for eviction and foreclosure if the loan fails.

The loans also require a 25-year, renewable land lease.

HUD guarantees the loans under its Section 184 Indian Housing program. The program provides mortgage options for lenders who want to make home loans to American Indians and families.

Schatz said the bank became involved in the program because it conducts home buyer education programs for Turtle Mountain, as well as Standing Rock Sioux Reservation and Fort Berthold Indian Reservation.

Schatz said Union State Bank did all the paperwork for the loan and the North Dakota Housing Finance Agency helped complete the sale of the loan to Fannie Mae.

While the June 14 loan closing was a first for a home mortgage, Union State Bank has closed other Indian Housing program loans for renovation and new construction on non-trust land.