HB-1-3555

(03-09-16) SPECIAL PN 15-1

Revised (04-01-24) PN 609

CHAPTER 15: SUBMITTING THE

APPLICATION PACKAGE

[7 CFR 3555.107]

15.1 INTRODUCTION

It is the lender’s responsibility to work with the applicant to ensure all necessary 

documentation is obtained to satisfy the requirements for loan eligibility. Lenders may 

utilize industry standard forms when assembling the application package. The loan must 

be underwritten and approved by the lender prior to submission to the Agency. The 

Agency requires that lenders use the Guaranteed Underwriting System (GUS), the 

Agency’s automated underwriting system, for all supported loan products. Lenders will 

certify upon a “final” underwriting submission that the loan has been reviewed, 

underwritten, and all data entered in GUS is true, complete, accurate, and retained. 

Lenders must review the GUS Underwriting Findings Report to ensure all requirements 

are met. Refer to Attachment 15-A, Guaranteed Rural Housing – Loan Origination 

Checklist for a list of required items to be provided to the Agency for a complete loan 

application package. 

15.2 LENDER RESPONSIBILITY

The originating lender is responsible for the accuracy of all information used to

obtain a Rural Development guarantee in accordance with 7 CFR 3555 and this 

Handbook. The permanent loan file must contain verified documentation that supports 

household eligibility for the Single Family Housing Guaranteed Loan Program

(SFHGLP) and the lender’s approval of the loan request. 

 Lenders are not authorized to close loans prior to the issuance of the Conditional 

Commitment. Closing a loan prior to obtaining a Conditional Commitment from the 

Agency will render that loan submission ineligible for a Loan Note Guarantee and may 

affect the lender’s approval status to participate in the program.

15.3 LOAN APPLICATION PACKAGE

A. Manually underwritten loans

Manually underwritten loans are defined as: 

• GUS applications that receive an underwriting recommendation of “Refer” or 

“Refer with Caution”, or 

• Applications reviewed and approved that are not supported in GUS, including 

Streamlined Assist Refinance transactions and select pilot programs. 

o These loan applications must be manually submitted and underwritten. The 

associated documents may be uploaded in GUS, and a job aid for this type of 
HB-1-3555

Paragraph 15.3 Loan Application Package

15-2

submission is available in the USDA LINC Training and Resource Library in 

the “Loan Origination” tab located at https://www.rd.usda.gov/resources/usdalinc-training-resource-library/loan-origination. Alternatively, the lender may

email the complete loan application package to the appropriate Rural 

Development Production Team. The applicable email address can be found 

on the SFH Guaranteed Lender webpage at https://www.rd.usda.gov/page/sfhguaranteed-lender. Lenders must ensure all personally identifiable 

information (PII) is protected. 

B. Guaranteed Underwriting System - GUS Accept loans

1. Streamlined Documentation Loan Files

When GUS renders an underwriting recommendation of “Accept,” this allows the 

lender to submit streamlined documentation to request a Conditional Commitment. 

Information regarding processing procedures is located in the GUS User Guide

posted to the following resource site: 

https://www.rd.usda.gov/resources/usda-linc-training-resource-library/guaranteedunderwriting-system

2. Full Documentation Loan Files

GUS “Accept with Full Documentation” loan files require additional items to be 

submitted to the Agency. Full documentation submissions are not re-underwritten by 

the Agency. Full documentation loan files will undergo a review to compare the data 

entered by the lender to the submitted documentation. Any discrepancies identified

by the Agency will be reviewed with the approved lender before the file is released 

for correction or denied.

15.4 ELECTRONIC SIGNATURES

Rural Development will accept electronic signatures for origination, loan closing, and 

servicing documents unless otherwise prohibited by law or program. This guidance is 

limited to lenders. Agency staff will continue to follow internal policy.

The 7 CFR 3555 rule does not prohibit or consent to electronic signatures. Lenders 

may use electronic signatures when the lender perfects and maintains a first lien position, 

an enforceable promissory note, and meets all other agency requirements. This includes 

electronic promissory notes (eNotes), deed of trust and other documents relevant to the 

loan transaction. Lenders should be familiar with the securitization requirements of 

government sponsored enterprises (GSE), such as Ginnie Mae, regarding the 

transferability of eNotes. 

Lenders who choose to accept electronic signatures must meet the standards and 

requirements set forth in the E-Sign Act, as well as all other applicable federal and state
HB-1-3555

Paragraph 15.4 Electronic Signatures

(03-09-16) SPECIAL PN 15-3

Revised (04-01-24) PN 609

regulations and guidelines. Lenders are charged with the same responsibility of due 

diligence with electronically signed documents as they are with paper documents. 

If any electronically signed document is deemed unenforceable (e.g. the promissory 

note, mortgage or deed of trust) and is connected to any fraud, misrepresentation or 

negligent servicing, the lender bears the risk that any loss claim submitted in relation to 

the unenforceable document will be denied or reduced in accordance with applicable 

regulations. The lender’s failure to collect on the promissory note or enforce the security 

instrument because of its electronic signature will be treated as negligent servicing under 

SFHGLP regulations.

Failure to comply with any Federal statute or regulation could result in the denial of a 

loan guarantee or claim, withdrawal of lending authority and/or debarment from Federal 

programs.

15.5 AGENCY REVIEW OF APPLICATION PACKAGE

The Agency’s automated system will track the date and time the application package 

is received. Agency review of the application package is completed in the order it is 

received. As outlined below, there are circumstances which may require a more thorough 

review by the Agency. In these situations, the Agency will contact the lender. 

A. Content of Standard Review

In general, the Agency will review applications to determine that all program 

requirements have been met. The lender has sole responsibility to properly underwrite

the loan and ensure program requirements have been met. Agency review of the 

application does not relieve the lender of these responsibilities. Agency staff must 

determine if the loan: 

• Is made to an eligible applicant(s), 

• Is located in an eligible rural area, 

• Meets the adjusted annual income limit,

• Has appropriate collateral value to support the loan request, 

• Meets environmental requirements of RD Instruction 1970, and 

• Meets applicable requirements of 7 CFR 3555 and this Handbook. 

Agency staff will utilize the SFHGLP Documentation and Processing Checklist in 

their review of Conditional Commitment requests, which assists in the review, 

processing, and closing of a guaranteed loan.
HB-1-3555

Paragraph 15.5 Agency Review of Application Package

15-4

B. Agency Review of Lender’s Underwriting Decisions

It is the approved lender’s responsibility to underwrite loans, however, under limited

circumstances, the Agency may determine that a more thorough review of the lender’s 

submission should be performed. The Agency must notify the lender in writing of the 

additional review. The Agency may review the lender’s underwriting decisions under the 

following circumstances:

1. Lenders who are new to the program 

When a new lender is approved for participation in the program, the initial

application submissions will receive a thorough Agency review, including a review of 

the lender’s underwriting decisions. The purpose of these reviews is to provide 

training and ensure that the lender has a complete and accurate understanding of the 

Agency’s requirements. The Agency will continue to review new lender 

underwriting decisions until the Agency is confident that the lender is performing 

satisfactorily. Additional training is provided when incomplete or deficient packages 

are received during initial submission. 

2. Lenders that submit incomplete or inaccurate applications

If a lender submits incomplete applications or applications with inaccurate 

information, the Agency may choose to review the lender’s underwriting to ensure 

that they understand the Agency’s requirements. Thorough reviews will continue 

until the lender demonstrates their ability to submit complete and accurate application 

packages on a regular basis. 

3. Lenders with significant loan review findings

Lenders that exhibit above average default, foreclosure, and loss claim activity

may have their current loan submissions reviewed more thoroughly by the Agency. 

The lender will be referred to the Lender Oversight Branch for continued monitoring. 

C. Conditions for the Loan Guarantee

Agency staff will determine if any conditions must be met for the loan to qualify for a 

guarantee. Terms and conditions will be listed and issued to the lender on Form RD 

3555-18 or Form RD 3555-18E, Conditional Commitment for a Single Family Housing 

Loan Guarantee.

15.6 LENDER NOTIFICATION ON REQUEST FOR LOAN GUARANTEE

The Agency will notify the lender of the results from the application review. The 

following are possible results of the review:
HB-1-3555

Paragraph 15.6 Lender Notification on Request for Loan Guarantee

(03-09-16) SPECIAL PN 15-5

Revised (04-01-24) PN 609

A. The Request for a Loan Guarantee is Approved

If the loan file meets Agency requirements, the lender will receive an email with a 

link to view Form RD 3555-18/18E, Conditional Commitment for Single Family Housing 

Loan Guarantee. The Conditional Commitment establishes conditions for issuing the 

Loan Note Guarantee. This form will also be available under the Documents section of

the GUS system once it has been issued by the Agency. In order to receive the Loan 

Note Guarantee, the lender must submit any required documents and certify to all 

conditions noted on Form RD 3555-18/18E (including any attachments to the form). 

Chapter 16 of this Handbook provides additional guidance to obtain the Loan Note 

Guarantee.

B. Return of Incomplete Applications

If the application request is missing information specified in Attachment 15-A and/or 

the final GUS Underwriting Findings Report, the Agency will suspend the application 

and request the missing documentation from the approved lender. Once the file is 

complete, the lender must alert OPD staff that all requested information is ready for a 

subsequent review, as GUS does not automatically alert the Agency when new 

documentation is uploaded. The file will then be placed in line again for Agency review. 

If the lender cannot provide the necessary information, the lender should request to

withdraw the loan file from GUS. Agency staff will not withdraw loan files without first 

contacting the lender to request the missing documentation. 

C. The Request for a Loan Guarantee is Denied

The loan guarantee request will be denied if the proposed loan fails to meet program 

requirements. The Agency will notify the lender in writing of the reason for the denial 

and will provide review and appeal rights as indicated in Appendix 3 of this Handbook. 

The Agency must properly process the loan in the Agency’s internal Guaranteed Loan 

System (GLS) database to record the loan denial.

15.7 LENDER RESPONSE TO CONDITIONAL COMMITMENT

The lender has three responses to the issuance of Form RD 3555-18/18E: the lender 

may accept the terms and conditions, decline the terms and conditions for loan guarantee, 

or request that the terms and conditions be altered. 

A. Accepting the Conditions

If the lender understands and agrees to accept the conditions listed on Form RD 3555-

18/18E, no further communication with the Agency is required until the lender is ready to 

request the loan guarantee. The loan must close in accordance with Form RD 3555-

18/18E which includes: 

1. A loan amount equal to or less than the authorized amount, 
HB-1-3555

Paragraph 15.7 Lender Response to Conditional Commitment

15-6

2. An interest rate equal to or less than the authorized amount, and 

3. Compliance with all stated conditions. 

B. Declining the Conditions for Loan Guarantee

If the lender determines that the terms and conditions stated on Form RD 3555-

18/18E cannot be met, that the loan guarantee is not needed, or that the loan will not go to 

closing, the lender must inform the Agency in writing as soon as possible. The funds for 

that loan request are reserved for the transaction until the expiration of the Conditional 

Commitment. Upon being informed that the lender intends to decline the conditions for 

loan guarantee, Agency staff will cancel the loan guarantee obligation in GLS. This will 

release the committed funds for reallocation to a new commitment.

C. Requesting Changes in Conditions

Requests to close the loan at a lower loan amount or interest rate than those 

authorized on the issued Conditional Commitment do not require any action. If the 

lender believes that there are erroneous conditions and requirements on Form RD 3555-

18/18E that should be altered, the lender can contact the Agency and propose 

alternatives. The request must be via email and must not affect the eligibility of the loan. 

Modifications that adversely affect the loan, such as an increase in loan amount, 

interest rate, monthly liabilities, real estate taxes and homeowner’s insurance (that exceed 

the allowed threshold); or lower repayment income, assets, etc. require a new 

underwriting review. Refer to the resubmission policy outlined in Chapter 5 of this 

Handbook. The lender is not authorized to close the loan until a new Form RD 3555-

18/18E is issued. 
HB 1-3555

Attachment 15-A

Page 1 of 3

(03-09-16) SPECIAL PN

Revised (04-01-24) PN 609

ATTACHMENT 15-A

Guaranteed Rural Housing

 Loan Origination Checklist

Lender Instructions: Submit the identified documents for the applicable loan type. To expedite loan review, please submit only the 

identified documents. Documents must not exceed the maximum allowable age set forth in the 7 CFR 3555 and Handbook 1-3555.

Rural Development will consider all documents submitted as the certified and true copies of the original documents retained in the 

lender’s permanent file. Lenders should submit loan files electronically to Rural Development. See electronic delivery information in the 

SFHGLP Lending Partner Webpage: https://www.rd.usda.gov/page/sfh-guaranteed-lender. In the subject line include the following:

Loan Origination: Borrower Last Name, First Name

General Information

Applicant(s): Lender: Date:

Loan Origination Checklist

Guaranteed Underwriting System (GUS)- Purchase and Non-Streamlined and Streamlined Refinance Transactions

Underwriting Recommendation: ACCEPT

When submitting documents in GUS, the appraisal report must be uploaded separately in color. 

 Form RD 3555-21, Request for Single Family Housing Loan Guarantee

Include all pages from the current published version

Executed by applicant(s) and lender 

 FEMA Form FF-206-FY-21-116, Standard Flood Hazard Determination Form

New construction properties located in 100-year flood plains require additional documentation, including confirmation 

the base flood elevation (BFE) is below lowest habitable floor

 Mortgage Payoff Statement: If refinance transaction

 Credit Report for Non-Purchasing Spouse (as applicable)

Applies to applicant or property located in a community property state: AZ, CA, ID, LA, NV, NM, TX, WA, WI

 Uniform Residential Appraisal Report (URAR)

FNMA 1004/FHLMC 70 or applicable report as determined by appraiser (not required for most streamlined refinances)
HB 1-3555

Attachment 15-A

Page 2 of 3

Loan Origination Checklist

Manual Underwriting, GUS Refer/Refer with Caution Underwriting Recommendation, or

GUS Accept with Full Documentation Message on GUS Underwriting Findings and Analysis Report

When submitting documents in GUS, the appraisal report must be uploaded separately in color. 

 Form RD 3555-21, Request for Single Family Housing Loan Guarantee

Include all pages from current published version

Executed by applicant(s) and lender 

 Underwriting Analysis: FNMA 1008/FHLMC 1077, or similar form 

Documentation of annual and repayment income calculations

Credit waiver explanations, debt ratio waiver compensating factors, and overall loan file comments may be 

documented on this form

 Uniform Residential Loan Application: FNMA 1003/FHLMC 65

Not required to be signed by applicant(s) or lender 

Loan amount is not required to match the loan request in GUS or on Form RD 3555-21

 Income Verification Documentation: Applicable methods

Alternative Documentation: Non self-employed:

Written/Electronic VOE + 1 earning statement with YTD figures

Full Documentation: Non self-employed:

2 years W-2s + 4 weeks of earning statements with YTD figures

Self-Employed: 

2 years personal and business filed income tax returns or IRS transcripts with all schedules + YTD profit and loss 

statement

Additional Income Types: SSI, VA Benefits, Pension, Retirement, etc. 

Refer to Chapter 9 for acceptable verification documents 

 Asset Documentation: 

Documentation for all applicable household members per 3555.152(d)

VOD’s, bank or investment statements, gift letters, etc. Refer to Chapter 9 for acceptable verification documents.

 Credit Report: (as applicable)

Credit Report: For loans submitted outside of GUS. GUS loans will have the credit report uploaded. 

Non-Traditional credit tradelines, as applicable 

Credit supplements, if utilized to support data adjusted from credit report

 Credit Report for Non-Purchasing Spouse (as applicable)

Applies to applicant or property located in a community property state: AZ, CA, ID, LA, NV, NM, TX, WA, WI

 Verification of Rent: 

NOT APPLICABLE FOR GUS ACCEPT FULL DOCUMENTATION 

Applicable for manually underwritten loans with credit scores less than 680 when rental history is indicated. 

Refer to Chapter 10 for guidance on documenting rent and non-traditional credit when a VOR is required, but not 

available.

 Mortgage Payoff Statement: If refinance transaction

 FEMA Form FF-206-FY-21-116, Standard Flood Hazard Determination Form:

New construction properties located in 100-year flood plains require additional documentation, including 

confirmation base flood elevation (BFE) is below lowest habitable floor

 Uniform Residential Appraisal Report (URAR)

NOT APPLICABLE TO MOST STREAMLINED OR STREAMLINED-ASSIST REFINANCES

FNMA 1004/FHLMC 70 or applicable report as determined by appraiser 
HB 1-3555

Attachment 15-A

Page 3 of 3

(03-09-16) SPECIAL PN

Revised (04-01-24) PN 609

Loan Origination Checklist

Streamlined Assist Refinance Manual Underwrite Review

 Form RD 3555-21, Request for Single Family Housing Loan Guarantee

Include all pages from current published version

Executed by applicant(s) and lender 

 Underwriting Analysis: FNMA 1008/FHLMC 1077, or similar form 

Documentation of annual and adjusted annual income calculations

 Uniform Residential Loan Application: FNMA 1003/FHLMC 65

Not required to be signed by applicant(s) or lender

Loan amount is not required to match the loan amount on Form RD 3555-21

 Income Verification Documentation: Required for Annual Income Calculations

Alternative Documentation: Non self-employed:

Written/Electronic VOE + 1 earning statement with YTD figures 

Full Documentation: Non self-employed:

2 years W-2’s + 4 weeks of earning statements with YTD figures

Self-Employed: 

2 years personal and business filed income tax returns or IRS transcripts with all schedules + YTD profit and loss 

statement

Additional Income Types: SSI, VA Benefits, Pension, Retirement, etc. 

Refer to Chapter 9 for acceptable verification documents 

 Asset Documentation: Annual Income Calculations

Documentation for all applicable household members per 3555.152(d)

VOD’s, bank or investment statements, gift letters, etc. Refer to Chapter 9 for acceptable verification documents.

 Mortgage Payment History for previous 12-month period 

Credit Report or Verification of Mortgage

 Mortgage Payoff Statement

 Uniform Residential Appraisal Report (URAR)

Only applicable to current Direct Loan borrowers for the purpose of calculating subsidy recapture.