FORM RD 2006-46 (Rev. 01-98)

U.S. DEPARTMENT OF AGRICULTURE MANUAL ISSUE No.

RURAL DEVELOPMENT WSAL PN 592

Washington, D.C 20250 DATE

September 27, 2023 

PROCEDURE NOTICE

RD MANUAL CHANGES

INSERT RD INS 440.1 INTEREST RATES, AMORTIZATION, 

(WSAL) GUARANTEE FEE, ANNUAL CHARGE, AND 

FIXED PERIOD. This Instruction is 

partially revised as follows:

Exhibit B is partially revised to update the Treasury Judgement rate and the 

effective date of October 1, 2023. 

REMOVE INSERT

Exhibit B: Exhibit B: 

 Pages 1 & 2 dated 09-15-23 Pages 1 & 2 revised 09-27-23. 

RD HANDBOOK CHANGES

INSERT RD HB-1-3555 GUARANTEED LOAN PROGRAM TECHNICAL

(WSAL) HANDBOOK. This Handbook is partially 

revised. The specific revisions 

are outlined below.

Chapter 9: 

Revisions are required to implement new asset balance guidance as decided upon by 

the SFHGLP Credit Policy Committee (CPC), to provide guidance on how GUS auto 

calculates net rental income, to clarify that comingled business/personal accounts 

need to be considered in household assets, and to clarify that IRS transcripts must 

be requested timely and retained in lender’s permanent loan file. Additionally, 

updates were made to reference applicant (singular) to applicants (plural) and 

replace “application date” with “submission to the Agency.”

Paragraph 9.3, Annual Income, IRS Transcripts: Verification of Income 

• Clarified that although loan closings may proceed without transcripts, 

lenders are responsible for obtaining transcripts for their files, and 

the request for transcripts must be made timely.

• Removed the last paragraph regarding adult household members without 

social security numbers. 

Paragraph 9.4, Calculating Income from Assets

• Added that if applicants own a business, the lender needs to verify that 

assets are not transferred from a personal account to a business account 

and vice versa. The accounts should function separately. If the accounts 

are co-mingled, the assets would need to be included in the calculation 

of net family assets. 

Attachment 9-A, Income and Documentation Matrix, Rental Income

• Added that unless manually overwritten, GUS auto-calculates net rental 

income by employing a 25% vacancy factor.

(CON.)

READ PROCEDURE - DISCUSS IN STAFF CONFERENCE - KEEP PROCEDURE MANUAL UP TO DATE
Page 2 ISSUED: PN 592

September 27, 2023

RD HANDBOOK CHANGES

INSERT RD HB-1-3555 (Con.)

Chapter 9: 

Attachment 9-A, Assets and Reserves

• Added clarification that when assets are entered into GUS and used as 

reserves, lenders must ensure that the funds are available to the 

applicants post-closing.

• Clarified that unverified funds are not an acceptable source of funds 

for down payment, closing costs, etc.

• Updated guidance for “Business Accounts” and “Depository Accounts” to 

state that lenders must use the balance as reflected on the most current 

bank statement or Verification of Deposit (VOD), if the date on the VOD 

is after the bank statement, for reserves.

• Clarified the sourcing requirements for gift funds.

Attachment 9-C, Example Case Study

• Revised example to include a scenario where household members have 

assets that exceed $50,000 to demonstrate the appropriate calculation 

that would apply.

Chapter 10: 

The following updates were made to HB-1-3555, Chapter 10 to make clarifications 

within the chapter and update the Agency’s credit eligibility requirements for a 

complete loan file submission. Additionally, minor grammatical and formatting edits 

were made to be consistent with other handbook chapter revisions.

Attachment 10-A Credit Matrix: Credit Matrix

• Corrected the word “contradictory” notated under “ALL GUARANTEED 

LOANS”.

Attachment 10-A Credit Matrix: Credit Inquiries/Recent Debts/Undisclosed debts

• Added guidance that for undisclosed debts not listed on the loan 

application but discovered during the mortgage loan application process 

must be manually entered into GUS.

Attachment 10-A Credit Matrix: Overdraft/Non-Sufficient Funds (NSF)

• Added guidance, including the definition for both overdraft and nonsufficient funds (NSF), lenders may choose to include these types of 

fees in their monthly debt, and that underwriters should consider these 

types of events in their credit decisions. 

Attachment 10-A Credit Matrix: Chapter 7 Bankruptcy

• Added language to clarify that per 7 CFR 3555.151(i)(3) for manually 

submitted loans with a bankruptcy debt that was discharged within the 

previous 36 months is considered significant derogatory credit.

• The word "dismissed" has been removed from the same guidance as 

discharged bankruptcy cases as it appears to conflict with 7 CFR 

3555.151(i)(3); dismissed cases are not addressed in the CFR. Dismissed 

bankruptcy cases has been addressed in a separate sentence. 

(CON.)
Page 3 ISSUED: PN 592

September 27, 2023

RD HANDBOOK CHANGES

INSERT RD HB-1-3555 (Con.)

Attachment 10-A Credit Matrix: Credit Matrix: Chapter 11, 12, or 13 Bankruptcy 

• Added language to clarify that for GUS Refer, Refer with Caution, and 

manually underwritten files, the lender must obtain documentation to 

verify that the 12 months of the debt restructure plan has elapsed and 

retain in their permanent loan file.

Attachment 10-A Credit Matrix: Delinquent Court Ordered Child Support 

• Added “In all cases, the lender must provide certification of the 

applicant’s eligibility as part of the application submission. Any 

documentation obtained to support the lender’s certification to the 

Agency will be retained in the lender’s permanent loan file.” 

Attachment 10-A Credit Matrix: Delinquent Federal Non-Tax Debt

• Added “The lender must provide certification of the applicant’s 

eligibility to the Agency at final submission. Any documentation 

obtained to support the lender’s certification to the Agency will be 

retained in the lender’s permanent loan file.”

Attachment 10-A Credit Matrix: Federal Taxes 

• Added that proof of repayment plan(s) is required when an applicant has 

more than one with IRS and a minimum of three timely payments is 

required on each active repayment plan(s).

• Added language to clarify that an applicant with multiple approved IRS 

repayment plan(s) are eligible but the approved lender’s underwriter 

must review and determine if the applicant(s) is an acceptable credit 

risk. 

• Added language that the lender must provide certification of the 

applicant’s eligibility to the Agency as part of the application 

submission. Evidence of the repayment agreement(s) and payment history 

used to support the lender’s certification to the Agency will be 

retained in the lender’s permanent loan file.

Attachment 10-A Credit Matrix: Disputed Accounts: Non-Derogatory 

• Revised language referring to “GUS Accept recommendations” and 

“downgrading” to match the current GUS FICO Rule.

Attachment 10-A Credit Matrix: Foreclosure or Repossession

• Revised language to clarify that foreclosures or repossession can refer 

to any type of “property”.

• Added language to clarify that per 7 CFR 3555.151(i)(3) for manually 

submitted loans with a foreclosure or repossession that was discharged 

within 36 months prior to the date of application is considered 

significant derogatory credit and the lender must retain documentation 

in their permanent loan file.

Attachment 10-A – Credit Matrix: Previous USDA Loss 

• Added language that a previous USDA loss within the last seven years is 

considered significant derogatory credit. 

(CON.)
Page 4 ISSUED: PN 592

September 27, 2023

RD HANDBOOK CHANGES

INSERT RD HB-1-3555 (Con.)

Attachment 10-A – Credit Matrix: Rent/Mortgage Payment History

• Added guidance that would apply to “All Guaranteed Loans” to address

that underwriters should review and evaluate the risk factors

associated with applicants who will be paying a higher proposed

mortgage payment compared to their existing housing payment.

• Added language to clarify that all housing payments entered in GUS

should be verified and documented including those payments made within

the previous 12 months. Applicants with no verifiable history of

housing payments are not automatically ineligible. However, it will be

the approved lender’s responsibility to review available documentation

to determine if the applicant has acceptable credit history and meets

program guidance.

• Added guidance for documenting of rent or mortgage payments received

from family members or other interested party must include 12 months of

canceled checks, money order receipts, or electronic payment

confirmations.

• Added language to clarify that per 7 CFR 3555.151(i)(3) for manually

submitted loans with a rent payment paid 30 or more days late within

the last 12 months, the lender must submit documentation to the Agency

at final submission.

REMOVE INSERT

Chapter 9 dated 03-09-16: Chapter 9 dated 03-09-16: 

 Pages 9-1 thru 9-12, Pages 9-1 thru 9-12, 

 Attachment 9-A, Attachment 9-A revised, 

 Attachment 9-C, Attachment 9-C revised, 

 Attachment 9-E; and Attachment 9-E revised; and

Chapter 10 dated 02-23-12: Chapter 10 dated 02-23-12:

 Pages 10-1 thru 10-3. Pages 10-1 thru 1-3 revised, 

 Attachment 10-A. Attachment 10-A revised 09-27-23. 

RD HANDBOOK CHANGES

INSERT RD HB-3-3560

(WSAL)

REMOVE

Table of Contents: 

 Page 23; 

Chapter 15 dated 02-22-05:

MFH PROJECT SERVICING HANDBOOK. This 

Handbook is partially and these changes are 

the result of input the Agency received from 

stakeholder listening sessions.

INSERT

Table of Contents: 

 Page 23 revised; 

Chapter 15 dated 02-24-05:

 Attachment 15-C, Attachment 15-C revised, 

 Attachment 15-C-2, Attachment 15-C-2 revised, and

 Attachment 15-C-3, Attachment 15-C-3 added 09-27-23. 

 Attachment 15-C-4, and

 Attachment 15-C-7.

oOo