DATE
Proposed Changes to Eligibility of Certain Rural Areas
Determining Property Eligibility by Application
Date
On March 16, 2018, the proposed ineligible area maps for the Rural
Development Single Family Housing (SFH) and Multi-Family Housing
programs were posted to the USDA Income and Property Eligibility Site at https://eligibility.sc.egov.usda.gov. Users
will need to select the “Proposed Ineligible
Areas” tab after choosing the appropriate program (e.g. Single Family Housing
Guaranteed) to view the new ineligible area maps. The “Proposed Ineligible Areas” maps show all ineligible, non-rural areas and not only the new non-rural areas. In some cases, previously ineligible areas will now become eligible rural areas.
The new ineligible areas will become effective on June 4, 2018.
Loan Guarantee
Processing
On June 4, 2018, all
properties for new applications must be located in an eligible rural area based
on the new maps. However, a property that is located in an area being
changed from rural to non-rural may be approved if all of the following conditions
are met:
- The application is dated and received by the lender prior to June 4, 2018 and the Loan Estimate was issued by the lender within 3 days of application receipt.
- The applicant has a signed/ratified sales contract on a property that is dated prior to June 4, 2018.
- Applicant meets all other loan eligibility requirements.
If the property is
located in an area being changed from rural to non-rural, lenders must
provide Rural Development all of the following information in addition to all
other required documentation. For loans
submitted via the Guaranteed Underwriting System (GUS), the documentation must
be uploaded into the system.
- Copy of the
signed/ratified and dated sales contract.
- Copy of the Loan
Estimate issued to the applicant.
-
Verification that the
property was located in an eligible rural area prior to June 4, 2018. Note: Maps of the “Previous Eligible Areas” will be available on the
Eligibility site beginning June 4, 2018. A printout of the map indicating
the property address was previously eligible is acceptable.
GUS underwriting
recommendations will display an INELIGIBLE property determination for property
that is no longer located in an eligible rural area. The INELIGIBLE property determination is the
second half of the GUS underwriting recommendation. For example, an ACCEPT/INELIGIBLE
underwriting recommendation will apply to a request where the applicant’s
credit and capacity assessment is an ACCEPT (first part of the underwriting
recommendation) however the property is located in an INELIGIBLE area (second
part of the underwriting recommendation).
This does not prevent the lender from completing the final submission to
Rural Development. The Rural Development
reviewer will be able to override the property eligibility determination when
the lender has uploaded the required documentation noted above.
To assist Rural
Development in processing your loan guarantee request expeditiously,
lenders should ensure the documentation noted above is submitted
to Rural Development for review when requesting the guarantee.
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