USDA releases final rule for Section 502 loan packaging

On April 29, 2015 the USDA Rural Housing Service (RHS) published a final rule for Section 502 loan packaging. RHS had previously published a proposed rule on August 23, 2013, to amend its regulations for the section 502 direct single family housing loan program and create a certified loan application packaging process. This final rule incorporates revisions based on a series of public comments and the results of the pilot program which RHS began in 2010 designed to test changes to the loan application process. It will also impose experience, training, structure and performance requirements on eligible service providers and regulate the allowed packaging fee. RHS hopes that:

“By establishing a vast network of competent, experienced, and committed Agency-certified packagers, this action is intended to benefit low- and very low-income people who wish to achieve homeownership in rural areas by increasing their awareness of the Agency’s housing program, increasing specialized support available to them to complete the application for assistance, and improving the quality of loan application packages submitted on their behalf.

For additional information, contact Brooke Baumann, Branch Chief, Single Family Housing Direct Loan Division, USDA Rural Development, Telephone: 202-690-4250. Email: brooke.baumann@wdc.usda.gov.