Section 247 of the National Housing Act authorizes mortgage insurance to lenders in order to offer a means to provide homeownership opportunities to individuals of Native Hawaiian bloodlines. FHA insures loans made to native Hawaiians to purchase one- to four-family dwellings located on Hawaiian home lands (HHL).

Regulations pertaining to these loans are fundamentally the same as regular Section 203(b) loans except that they are only available to Native Hawaiians on Hawaiian home lands. Because a mortgage is taken on a homestead lease granted by the Department of Hawaiian Homelands (DHHL), many lenders have been reluctant to finance housing. With FHA insurance, the lender's risk is minimized, and this program increases the availability of mortgage credit to Native Hawaiians to live on Hawaiian home lands.

A "Native Hawaiian" means any descendant of not less than one-half part of the blood of the races inhabiting the Hawaiian Islands before January 1, 1778 or, in the case of an individual who succeeds a spouse or parent in an interest in a lease of Hawaiian home lands, such lower percentage as may be established for such succession under Section 209 of the Hawaiian Homes Commission Act, 1920, or under the corresponding provision of the constitution of the State of Hawaii adopted under Section 4 of the Act entitled, "An Act to provide for the admission of the State of Hawaii into the Union," approved March 18, 1959.