USDA’s Single Family Housing Guaranteed Loan Program (SFHGLP) provides lenders an opportunity to offer 100% financing with no down payment to qualifying rural homebuyers. USDA offers a loan note guarantee that protects against loss up to 90% of the original principal loan amount. This allows for loans to be made that may not otherwise be eligible for financing, and opens the door for lenders to assist more loan applicants in rural areas. USDA does not underwrite the loans and relies on lenders to make sound underwriting decisions. Lenders must also have a proven ability to originate, underwrite, service, and hold SFH mortgage loans. Therefore, the Agency must approve a lender to ensure that required standards are met and loans will be made responsibly.
To be eligible, the lender must currently be approved to participate in an acceptable secondary market organization or other Federal government agency. Chapter 3 of HB-1-3555 Technical Handbook (located under the “Loan Origination” tab of this library) contains important information including the Lender Approval Checklist, Compliance Reviews, Lender Recertification/Revocation, and more.
A brief training module on the lender approval process is accessible below, as is the Attachment 3A checklist for submitting your Lender Approval request.
If you still have any questions, please contact the Quality Assurance & Lender Oversight Division at: SFHGLD.Compliance@usda.gov