Should Native Americans Use Tribal Lenders?

Published October 24, 2017

WASHINGTON – If you need to get a loan in the USA, you have the option of using a traditional lender or a tribal lending service. Choosing the right one is important because it could form an essential part of growing your business or purchasing a new house or car. Since tribal lenders operate using sovereign immunity, they are not constrained by the same regulations as other loan companies. This increases flexibility, but may come with additional drawbacks. Here are some of the pros and cons of using tribal lenders.


During economic hardship, it can be hard for reservations isolated from urban areas to meet the needs of its citizens. Often tribal leaders lack the wealth needed to provide for their people, but online tribal lending can overcome this. By using a tribal lending service, Native Americans are able to inject cash into their local community in order to retain sovereignty.

Better Rates

If you are searching for the best auto loan rates or cheapest mortgage, then tribal lending could offer significant savings. By circumventing regulations, tribal loan lenders are able to avoid some of the overhead costs of red tape, passing these savings onto the customer.

Furthermore, the Native American Financial Services Association (NAFSA) understands the needs of Native people. They do not offer traditional payday loans, which are seen as unethical and exploitative of low income earners. Instead, they offer short term installments. These help people who don’t have access to banks or credit cards, offering an affordable and ethical solution.

Possible risks

There is evidence that non-tribal lenders are operating under sovereign immunity in order to ignore necessary regulations without being subject to prosecution. As a result, the loans you receive may lack transparency and legitimacy.

Regulations exist to provide consumer protection. Without such regulations, you could be subject to a bad contract which ignores your rights as a borrower. You therefore need to take extra precautions to check the legitimacy of your lender and read all legal documents carefully. Look for reviews of the lender online and ensure that no previous customers have had any issues.

Tribal loans offer the chance for Native American tribes to thrive. They can be a much needed cash injection to stimulate the local economy and provide jobs and prosperity. However, their immunity from federal regulations means that they can be subject to abuse. Take time to go through the legality of any loan thoroughly before accepting.

The post Should Native Americans Use Tribal Lenders? appeared first on Native News Online.

This BBSNews article was syndicated from Native News Online, and written by Native News Online Staff. Read the original article here.

This BBSNews article originally appeared on Native News Online.