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Section 538 Rural Rental Housing Guaranteed Loans

Program Descriptions

Program Number

10.438

Title

Section 538 Rural Rental Housing Guaranteed Loans

 

Federal Agency

RURAL DEVELOPMENT, DEPARTMENT OF AGRICULTURE

 

Authorization

Housing Act of 1949, as amended, Section 538, Public Law 106-569, 42 U.S.C. 1490p-2.

 

Status

Active

 

Objectives

This program has been designed to increase the supply of affordable multifamily housing in rural areas through partnerships between Rural Development and major lending sources, as well as State and local housing finance agencies and bond insurers. The program provides Federal credit enhancement to encourage private and public lenders to make new loans for affordable rental properties that meet program standards.

 

Types of Assistance

Guaranteed/Insured Loans.

 

Uses and Use Restrictions

The guarantee will encourage the construction of new rural rental housing and appropriate related facilities. Housing as a general rule will consist of projects with five or more dwellings. The guarantee may not be made for nursing, special care or industrial type housing.

 

Eligibility Requirements

Applicant Eligibility

The applicant in this program is the lender. The lender must be approved and currently active with Fannie Mae, Freddie Mac, HUD/FHA insurance programs, Ginnie Mae or be a State or local Housing Finance Agency. A member of the Federal Home Loan Bank System or other lender may be able to participate if they can demonstrate satisfactory experience with multifamily lending.

Beneficiary Eligibility

Occupants must be families or persons with income not in excess of 115 percent of the Median Income at the time of initial occupancy.

Credentials/Documentation

Eligible borrowers include: individual partnerships; profit and not-for-profit corporations; limited liability companies; trusts; State and local agencies; and Indian Tribes.

 

Application and Award Process

Preapplication Coordination

None. This program is excluded from coverage under E.O. 12372.

Application Procedure

The lender originates the loan and performs the necessary underwriting and provides the documentation required by the RHS and request for guarantee to the RHS for consideration.

Award Procedure

Rural Development will review all the applications for compliance with the program requirements and issue the Conditional Commitment of Guarantee with conditions. Once the conditions are met the final Contract of Guarantee will be issued.

Deadlines

Please contact the program contact listed in the Information Contacts section below.

Range of Approval/Disapproval Time

The review and award process is established at 60 days from the end of the NOFA.

Appeals

Applicants may appeal adverse decisions in accordance with 7 CFR Part 11, National Appeals Division.

Renewals

 

Assistance Considerations

Formula and Matching Requirements

None.

Length and Time Phasing of Assistance

Not applicable.

 

Post Assistance Requirements

Reports

Per program requirements.

Audits

As required by the lender and program regulations.

Records

Good business records and any records required by the lender.

 

Financial Information

Account Identification

12-0137-0-1-604.

Obligations

(Loans) FY 07 $197,997,000; FY 08 est not available; and FY 09 est not reported.

Range and Average of Financial Assistance

Not applicable.

 

Program Accomplishments

Not available.

 

Regulations, Guidelines and Literature

The final rule, 7 CFR 3565, was effective January 19, 2005. Also available in the Guaranteed Rural Rental Housing Program Origination and Servicing Handbook.

 

Information Contacts

Regional or Local Office

Consult your local telephone directory for Rural Development field office number. If no listing, get in touch with appropriate Rural Development State office listed in Appendix IV of the Catalog or on the internet at http://www.rurdev.usda.gov

Headquarters Office

Director, Multi-Family Housing Processing Division, Rural Development, Department of Agriculture, Washington, DC 20250. Telephone (202) 720-1604. Use the same number for FTS.

Web Site Address

http.//www.rurdev.usda.gov

 

Related Programs

None.

 

Examples of Funded Projects

Not applicable.

 

Criteria for Selecting Proposals

Provided in the NOFA.



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