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Rural Development

Joaquin Altoro 

Administrator 

Rural Housing Service 

1400 Independence Ave, SW 

Room 5011-S 

Washington, D.C. 20250 

TO: All RHS MFH National Office Directors

 Rural Development 

ATTN: Leadership Designees

 All Multi-Family Housing Program Staff

 Rural Development 

FROM: Joaquin Altoro 

 Administrator

 Rural Housing Service 

SUBJECT: Section 514/516, Section 515, and Section 538 Multi-Family 

Housing Program Use of Digital/Electronic Signatures

PURPOSE

The purpose of this Unnumbered Letter (UL) is to provide guidance to all MultiFamily Housing (MFH) program staff on the use of and acceptance of electronic 

signatures, electronic transmission, and electronic storage of documents and forms 

required by Rural Development (RD), Rural Housing Service (RHS) in the 

Multifamily Housing (MFH) Program as it pertains to 7 CFR 3560 and 7 CFR 3565. 

For the purpose of this unnumbered letter, industry partners include, but is not 

limited to, owners of Section 514/516, Section 515, and Section 538 multifamily 

housing properties, management agents, lenders, and service providers.

BACKGROUND

The use of electronic signatures in transactions involving federal organizations is 

primarily governed by one or more of the following laws (E-Transaction Laws): 

1. Electronic Signatures in Global and National Commerce Act (E-SIGN) Act 

Pub. L. 106-229 (June 30, 2000), 114 Stat.464, codified at 15 U.S.C. 7001-

7006. E-SIGN encourages federal agencies to accept electronic signatures. 

2. The Uniform Electronic Transaction Act (UETA), approved by the National 

Conference of Commissioners on Uniform State Laws (NCCUSL) on July 

23, 1999. UETA provides that when a law requires either a record to be in 

writing or include a signature, an electronic record or an electronic signature 

can satisfy that requirement, so long as the parties to the transaction have 

agreed to proceed electronically. There are a couple of states which have 

chosen not to adopt the UETA Act and may have their own state Act in 

place.

EXPIRATION DATE: FILING INSTRUCTIONS:

May 31, 2024 Housing Programs 
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The program regulations at 7 CFR 3560 and 7 CFR 3565 do not expressly prohibit or consent to 

digital or electronic signatures. Program regulations require that signed documents are submitted 

to the Agency. 

This unnumbered letter clarifies that the Agency will accept electronically submitted documents, 

which include digitally or electronically submitted signatures submitted by borrowers, grantees, 

borrower representatives, lenders, management agents, and any other person wishing to 

electronically interact with the Agency if the policies set forth in this unnumbered letter, all state, 

county, and local laws, and all other requirements of the Agency are met. 

IMPLEMENTATION

The Agency may accept all documents associated with originating or servicing direct (Section 515 

and/or 514) or guaranteed loan(s) (Section 538), or grant(s) (Section 516) which are signed 

digitally or electronically, provided the documents are in compliance with or other federal, state or 

local government signatory requirements. The acceptance and use of digital or electronic 

signatures by lenders, borrower grantees, and tenants is voluntary and encouraged. The Agency 

recognizes that electronic signatures include digital signatures as a subset. 

The digital/electronic signature, printed name, and date must be clearly observed when the 

document is viewed either electronically or if printed. Parties who chose to submit and accept 

digital or electronic signatures must meet the standards and requirements set forth in the ESIGN 

Act as well as all other applicable federal and state regulations and guidelines. Parties must still 

adhere to all program regulations, guidance, and agreement as usual. Parties are charged with the 

same responsibility of due diligence with digitally or electronically signed documents as they are 

with paper documents. Parties are not required to submit follow-up hard copy of original 

information to the Agency 

Accepting Forms and Documents Electronically

Unless otherwise restricted, all multifamily housing program forms and related documents may be 

accepted electronically when received via:

• Email, with attachments

• Fax

• Grants.gov 

• Cloud Vault 

• Any other existing or future electronic system supported by the Agency (i.e. MINC – 

Management Interactive Network Connection) 

Parties are not required to follow up with an original paper document or signature when forms are 

submitted in this manner; however, normal business practices and retention of documents are 

required to be followed when obtaining signatures of applicants/tenants/borrowers and maintaining 

electronic documents.

The burden is on the borrower, borrower representative, lender, or grantee to confirm Agency 

receipt of electronically funded documents by program deadlines and provide documentation of 

submission upon Agency request. 
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Accepting Electronic and Digital Signatures

The Agency official will review to determine if a form has been properly electronically or

digitally signed by the appropriate individuals. Unless otherwise restricted, acceptable electronic or 

digital signatures include:

• Scanned or Faxed images of documents containing handwritten signatures; and 

• Digital signatures that provide a method to confirm the authenticity of the signature*, 

which may include but are not limited to: 

o have been emailed by a party known to the Agency, from a recognized email 

address; 

o identify the individual signing the document; and 

o identify the software vendor used to execute the digital signature (such as 

DocuSign) 

*Note: This can be accomplished by the sender providing an electronic file containing a 

validation indicator (such as a pop-up box), or through an additional document with 

verification information such as authentication details or an access password, signer

information, document tracking references, IP addresses, etc.

Unacceptable electronic signatures include:

• digital images of an individual’s signature (jpg or similar) copy and pasted in the signature 

block, without any digital signature validation; and

• typed names or initials in the signature line of a document, unless digital signature 

validation as described above. 

Retention of Electronic Documents and Reviews

Refer to Multifamily Housing handbooks and RD regulations for record retention requirements. 

Retention requirements are the same for both paper and electronic documents and records. 

For reviews conducted by RD, owner’s and management agent’s files may continue to be provided 

in paper format, if owners and management agents prefer. When available, reviews may also 

involve reading files electronically. In either instance, the files must be provided in compliance 

with RD’s or other federal, state or local government security access requirements and personally 

identifiable information must be protected. 

Regulatory Restrictions

Sections of RD’s regulations for multifamily housing programs require some notices to tenants be 

sent by first class mail, delivered directly to tenants or their units, or posted in public spaces. In 

these situations, electronic communication (email, posting on a website, etc.) does not satisfy the 

requirement, but may be provided through electronic communication in addition to the regulatory 

requirement. Owners, management agents, and industry partners must comply with current and 

future regulatory requirements. Regulatory requirements supersede the administrative requirements 

provided in this unnumbered letter and other RD Multifamily Housing handbooks and notices. 

If the owner or management agent maintains electronic tenant files, they must scan and store an 

electronic file of the tenant notification in the tenant’s file, when the tenant is provided a notice in 

paper form.
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Enforceability

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

note, mortgage or deed of trust, financial assistance agreement, etc.) and is connected to any fraud, 

misrepresentation or negligent servicing, the lender/borrower bears the risk that any loss claim 

submitted in relation with 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 

Rural Housing Service regulations. The borrower or grantee bears the consequences of 

unenforceable documents in the case of grants or direct loans.

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

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

Federal programs.

Contact Information 

If you have any questions regarding the guidance in this UL, please contact Deb Reed

deb.reed@usda.gov, Policy and Budget Branch, MFH Asset Management Division.