Federal Register / Vol. 87, No. 25 / Monday, February 7, 2022 / Rules and Regulations 6773 

■ 16. In § 3550.112, revise paragraphs 

(a) introductory text, (a)(1), and (c) to 

read as follows: 

§ 3550.112 Maximum loan and grant. 

(a) Maximum loan permitted. The 

sum of all outstanding section 504 loans 

to one household for one dwelling may 

not exceed an amount determined by 

the Agency based on factors such as 

average loan amounts and repair costs, 

but no greater than twenty percent of 

the national average area loan limit. 

(1) Transferees who have assumed a 

section 504 loan and wish to obtain a 

subsequent section 504 loan are limited 

to the difference between the unpaid 

principal balance of the debt assumed 

and the maximum loan permitted. 

* * * * * 

(c) Maximum grant. The lifetime total 

of the grant assistance to any one 

household or one dwelling may not 

exceed ten percent of the national 

average area loan limit. 

■ 17. In § 3550.113, revise paragraph (b) 

to read as follows: 

§ 3550.113 Rates and terms (loans only). 

* * * * * 

(b) Loan term. The repayment period 

for all section 504 loans will be 20 

years. 

Subpart D—Regular Servicing 

■ 18. In § 3550.162, revise paragraphs 

(b)(1) introductory text and (b)(1)(ii) to 

read as follows: 

§ 3550.162 Recapture. 

* * * * * 

(b) * * * 

(1) General. The amount to be 

recaptured is determined by a 

calculation specified in the borrower’s 

subsidy repayment agreement and is 

based on the borrower’s equity in the 

property at the time of loan pay off. If 

there is no equity based on the recapture 

calculation, the amount of principal 

reduction attributed to subsidy is not 

collected. The recapture calculation 

includes the amount of principal 

reduction attributed to subsidy plus the 

lesser of: 

* * * * * 

(ii) A portion of the value 

appreciation of the property subject to 

recapture. In order for the value 

appreciation to be calculated, the 

borrower will provide a current 

appraisal, including an appraisal for any 

capital improvements, or arm’s length 

sales contract as evidence of market 

value upon Agency request. Appraisals 

must meet Agency standards under 

§ 3550.62. 

* * * * * 

Subpart E—Special Servicing 

■ 19. Revise § 3550.201 to read as 

follows: 

§ 3550.201 Purpose of special servicing 

actions. 

The Rural Housing Service (RHS) may 

approve special servicing actions to 

reduce the number of borrower failures 

that result in liquidation. Borrowers 

who have difficulty keeping their 

accounts current may be eligible for one 

or more available servicing options 

including: Payment assistance; 

delinquency workout agreements that 

temporarily modify payment terms; 

protective advances of funds for taxes, 

insurance, and other approved costs; 

and payment moratoriums. Subject to 

the availability of funds and Agency 

priorities, refinancing may be available 

as a special servicing option in 

accordance with § 3550.52(c). 

■ 20. In § 3550.207, revise paragraphs 

(b)(2) and (c) and remove paragraph (d). 

The revisions read as follows: 

§ 3550.207 Payment moratorium. 

* * * * * 

(b) * * * 

(2) At least 30 days before the 

moratorium is scheduled to expire, the 

borrower must provide financial 

information needed to process the reamortization of the loan(s). 

(c) Resumption of scheduled 

payments. When the moratorium 

expires or is cancelled, the loan will be 

re-amortized to include the amount 

deferred during the moratorium and the 

borrower will be required to escrow. If 

the new monthly payment, after 

consideration of the maximum amount 

of payment subsidy available to the 

borrower, exceeds the borrower’s 

repayment ability, all or part of the 

interest that has accrued during the 

moratorium may be forgiven so that the 

new monthly payment optimizes both 

affordability to the borrower as well as 

the best interest of the Government. 

Subpart F—Post-Servicing Actions 

■ 21. In § 3550.251: 

■ a. Revise paragraphs (c)(4) and (5); 

■ b. Remove paragraph (c)(6); 

■ c. Revise paragraph (d)(2); 

■ d. Remove paragraph (d)(3); 

■ e. Redesignate paragraph (d)(4) as 

(d)(3). 

The revisions read as follows: 

§ 3550.251 Property management and 

disposition. 

* * * * * 

(c) * * * 

(4) Sale of program REO properties. 

For no less than 30 days after a program 

REO property is listed for sale, the 

property will be reserved for sale to 

eligible direct or guaranteed single 

family housing very-low, low- or 

moderate income applicants under this 

part or part 3555 of this title, and for 

sale or lease to nonprofit organizations 

or public bodies providing transitional 

housing and turnkey housing for tenants 

of such transitional housing in 

accordance with 42 U.S.C. 11408a. 

Offers from eligible direct or guaranteed 

single family housing applicants are 

evaluated at the listed price, not the 

offering price. Priority of offers received 

the same day from eligible direct or 

guaranteed single family housing 

applicants will be given to applicants 

qualifying for veterans’ preference, cash 

offers from highest to lowest, then credit 

offers from highest to lowest. 

Acceptable offers of equal priority 

received on the same business day are 

selected by lot. After the expiration of 

a reservation period, REO properties can 

be bought by any buyer. 

(5) Sale by sealed bid or auction. RHS 

may authorize the sale of an REO 

property by sealed bid or public auction 

when it is in the best interest of the 

Government. 

(d) * * * 

(2) RHS shall follow the standards 

and procedures in 42 U.S.C. 11408a for 

the sale or lease of an REO property to 

a public agency or nonprofit 

organization. The terms of the sale and 

lease, and the entity seeking to purchase 

or lease the REO property, must meet 

the requirements in 42 U.S.C. 11408a. 

* * * * * 

Joaquin Altoro, 

Administrator, Rural Housing Service. 

[FR Doc. 2022–02470 Filed 2–4–22; 8:45 am] 

BILLING CODE 3410–XV–P 

DEPARTMENT OF AGRICULTURE 

Rural Housing Service 

7 CFR Part 3555 

[Docket No. RHS–20–SFH–0025] 

RIN 0575–AD21 

Single Family Housing Guaranteed 

Loan Program 

AGENCY: Rural Housing Service, U.S. 

Department of Agriculture (USDA). 

ACTION: Final rule. 

SUMMARY: The Rural Housing Service 

(RHS or Agency), is implementing 

changes to Single-Family Housing 

Guaranteed Loan Program (SFHGLP) to 

mandate the use of the Guaranteed 

Underwriting System (GUS) and the 


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6774 Federal Register / Vol. 87, No. 25 / Monday, February 7, 2022 / Rules and Regulations 

1 GUS is a tool that helps evaluate the credit risk 

but does not replace the informed judgment of the 

experienced underwriter’s decision and does not 

serve the sole basis for making a final loan decision. 

See 7 CFR 3555.107(b). 

Lender Loan Closing System (LLC) by 

approved lenders. The Agency’s 

mandated use of GUS in loan 

originations and the LLC for loan 

closings will allow the Agency to 

decrease time-consuming and expensive 

manual file reviews, improve 

performance monitoring and reduce 

program risk of the guaranteed loan 

portfolio. 

DATES: This final rule is effective May 9, 

2022. 

FOR FURTHER INFORMATION CONTACT: 

Ticia Weare, Finance and Loan Analyst, 

Single Family Housing Guaranteed Loan 

Division, Rural Development, U.S. 

Department of Agriculture, STOP 0784, 

Room 2250, South Agriculture Building, 

1400 Independence Avenue SW, 

Washington, DC 20250–0784. 

Telephone: (702) 407–1400 x6001; or 

email: ticia.weare@usda.gov. 

SUPPLEMENTARY INFORMATION: 

Background 

Rural Housing Service (RHS or 

Agency) is an agency of the U.S. 

Department of Agriculture. RHS is 

issuing a final rule to amend the SingleFamily Housing Guaranteed Loan 

Program (SFHGLP) regulations found in 

7 CFR part 3555, subparts C and D, by 

updating the regulations to align the 

Agency’s program with the mortgage 

industry expectations in the domain of 

information technology. 

In order to provide efficient and 

timely delivery of the SFHGLP, it is 

necessary to streamline the processing 

of SFHGLP applications using 

automation initiatives as much as 

possible. The Agency is revising the 

regulation to mandate that lenders 

utilize GUS and the LLC systems for all 

supported applications and loan closing 

files. Mandatory use of GUS and the 

LLC will allow uniformity in 

application submissions, consistency in 

the timely processing of loan requests 

and will save time and administrative 

costs for both lenders and the Agency by 

eliminating the requirement for paper 

file storage, shredding costs, and mail 

with overnight courier fees. 

GUS is compatible with the Loan 

Origination Systems and Point of Sale 

vendors that are widely accepted 

throughout the industry. All SFHGLP 

loan products are supported by GUS, 

except for streamlined-assist refinance 

transactions and select pilot programs. 

Lenders will continue to submit 

manually underwritten files for these 

types of transactions by electronic 

means approved by the Agency. These 

loans are different from loans 

downgraded in GUS for manual 

underwriting—the downgraded loans 

will continue to be submitted via GUS 

for a manual review. Mandatory use of 

the automated underwriting system not 

only offers ease to lenders when 

uploading closing documents and 

payment of the guarantee and 

technology fees using the LLC, but 

efficiently and effectively allows 

Agency staff the capability to review 

loan applications, increases lender’s 

ability to transfer loans to program 

investors, and lessens the timeframe for 

underwriting and processing loan 

approvals. 

GUS is a robust automated system 

that processes application requests and 

provides specific loan closing data to 

the lender and the Agency. It offers 

added benefits to the lender’s decisionmaking process by producing 

underwriting findings reports and 

reliable credit data for managing 

borrower risks.1 Expanded use of the 

system will maximize the impact of core 

agency programs and drive innovation 

that will remove obstacles that delay 

loan production. 

This final rule will change how the 

agency receives loan requests by 

mandating the use of GUS for all 

supported loan type submissions and 

the LLC for all loan submissions. 

Currently, the Agency allows approved 

lenders to submit applications for loan 

guarantee requests by mail, electronic 

mail (email) or GUS. 

Discussion of Public Comments 

Received on January 19, 2021 Proposed 

Rule 

On November 17, 2020, RHS 

published a proposed rule for comments 

on the mandatory use of GUS for 

SFHGLP (85 FR 73241). The Agency 

received comments from eighteen 

respondents including Banks, Credit 

Unions, and other interested parties. 

Specific public comments are addressed 

below: 

Comment: Two respondents’ 

comments were unrelated to the 

proposed rule. One was an inquiry for 

small business loan assistance and the 

other, a business advertisement. 

Agency Response: The Agency has 

determined that no action is required. 

Comment: Two respondents 

commented that the benefit of the 

proposed rule will improve efficiency 

and effectiveness; however, they are 

concerned with the elimination of 

manual underwriting considering the 

automated underwriting system may be 

inadequate for certain credit risk 

scenarios and want to ensure an 

accommodation is considered for these 

scenarios. 

Agency Response: The Agency has 

determined that no action is required, 

the manual underwriting process 

remains unchanged for the following 

GUS recommendations of ‘‘Refer, Refer 

with Caution’’. 

Comment: Eight respondents 

commented they are concerned that the 

requirement for all lenders to submit 

requests through GUS would eliminate 

manual underwriting for submissions 

that receive a GUS recommendation of 

‘‘Refer or Refer with Caution’’. In 

addition, applicants without a credit 

score may be unable to apply. 

Agency Response: The use of alternate 

credit and the manual underwriting 

process remains unchanged for the 

following GUS recommendations: Refer, 

Refer with Caution. The Agency has 

provided clarification in 

§ 3555.107(c)(1) and § 3555.107(c)(2), by 

adding language explaining loans with 

GUS recommendations of ‘‘Refer and 

Refer with Caution’’ will continue to be 

manually underwritten. Clarification 

was added to § 3555.107(i)(4), 

explaining all closed loans including 

manual submissions are required to use 

Rural Development’s automated 

systems. 

Comment: Four respondents 

commented in favor of the proposed 

rule and indicate the rule will create a 

positive impact on consistency and 

efficiency. 

Agency Response: The Agency has 

determined that no action is required. 

Comment: Two respondents 

commented in opposition to the 

proposed rule, one citing a possible 

adverse impact on smaller lenders with 

limited resources who rely on manual 

submissions and the other cited 

concerns over accuracy of the data input 

as well as an economic impact the 

proposed rule may have. 

Agency Response: The Agency has 

determined that no action is required. 

The Agency does not anticipate a barrier 

to program participation and offers two 

opportunities to participate: (1) Through 

a connection with the lender’s point of 

sale or loan origination system, (2) 

entering loan application information 

directly into GUS. GUS is available to 

all approved lenders with 

eAuthentication credentials. The 

Agency has an established process for 

lenders to obtain eAuthentication 

credentials online that is free, easy, and 

does not create a burden to the lender. 

It is anticipated that the rule will 

provide more consistent and timely 

reviews which will benefit all lenders 

including small lenders. 


jspears on DSK121TN23PROD with RULES1
Federal Register / Vol. 87, No. 25 / Monday, February 7, 2022 / Rules and Regulations 6775 

Summary of Changes to Rule 

A summary of the changes includes 

amending 7 CFR 3555.107(b) 

introductory text and (b)(1), (3),and (6), 

to reflect that the use of the Agency’s 

automated underwriting system will be 

required for all supported submissions 

by alternate means, such as email or 

hard copy, will not be permitted and 

therefore the Agency will eliminate 

references to such submission methods. 

This final rule also amends 

§ 3555.107(c) and add paragraphs (c)(1) 

and (2) to describe the two types of 

loans that will continue to be manually 

underwritten. First, loan products not 

supported by the automated origination 

system, such as streamlined-assist 

refinance transactions and select pilot 

programs, must be manually 

underwritten and submitted via secure 

email or other electronic means 

approved by the Agency. Second, loans 

downgraded in the Agency’s automated 

origination system require manual 

underwriting, although lenders will 

continue to submit the loan 

documentation via the Agency’s 

automated systems. 

Concurrently, § 3555.107(i)(4) will be 

amended to require all loan closing 

documentation to be submitted via the 

Agency’s automated systems. 

Regulations § 3555.151(h)(2) will also 

be amended to clarify procedures for 

manually underwritten loans. The loan 

files for manually underwritten loans 

will continue to be submitted through 

the automated underwriting system but 

require full documentation review, and 

credit score validation or compensating 

factors. 

Statutory Authority 

Section 510(k) of Title V the Housing 

Act of 1949 (42 U.S.C. 1480(k)), as 

amended, authorizes the Secretary of 

the Department of Agriculture to 

promulgate rules and regulations as 

deemed necessary to carry out the 

purpose of that title. 

Executive Orders and Acts 

Executive Order 12866, Classification 

This rule has been determined to be 

not significant for the purposes of 

Executive Order 12866 and, therefore, 

has not been reviewed by the Office of 

Management and Budget (OMB). 

Executive Order 12988, Civil Justice 

Reform 

This rule has been reviewed under 

Executive Order 12988. In accordance 

with this rule: (1) Unless otherwise 

specifically provided, all state and local 

laws that conflict with this rule will be 

preempted; (2) no retroactive effect will 

be given to this rule except as 

specifically prescribed in the rule; and 

(3) administrative proceedings of the 

National Appeals Division of the 

Department of Agriculture (7 CFR part 

11) must be exhausted before bringing 

suit in court that challenges action taken 

under this rule. 

Unfunded Mandates Reform Act 

Title II of the Unfunded Mandates 

Reform Act of 1995 (UMRA), Public 

Law 104–4, establishes requirements for 

Federal agencies to assess the effect of 

their regulatory actions on state, local, 

and tribal governments, and the private 

sector. Under section 202 of the UMRA, 

the Agency generally must prepare a 

written statement, including a costbenefit analysis, for proposed and final 

rules with ‘‘Federal mandates’’ that may 

result in expenditures to state, local, or 

tribal governments, in the aggregate, or 

to the private sector, of $100 million, or 

more, in any one year. When such a 

statement is needed for a rule, section 

205 of the UMRA generally requires the 

Agency to identify and consider a 

reasonable number of regulatory 

alternatives and adopt the least costly, 

most cost-effective, or least burdensome 

alternative that achieves the objectives 

of the rule. 

This rule contains no Federal 

mandates (under the regulatory 

provisions of Title II of the UMRA) for 

state, local, and tribal governments, or 

the private sector. Therefore, this rule is 

not subject to the requirements of 

sections 202 and 205 of the UMRA. 

National Environmental Policy Act 

In accordance with the National 

Environmental Policy Act of 1969, 

Public Law 91–190, this final rule has 

been reviewed in accordance with 7 

CFR part 1970 (‘‘Environmental Policies 

and Procedures’’). The Agency has 

determined that (i) this action meets the 

criteria established in 7 CFR 1970.53(f); 

(ii) no extraordinary circumstances 

exist; and (iii) the action is not 

‘‘connected’’ to other actions with 

potentially significant impacts, is not 

considered a ‘‘cumulative action’’ and is 

not precluded by 40 CFR 1506.1. 

Therefore, the Agency has determined 

that the action does not have a 

significant effect on the human 

environment, and therefore neither an 

Environmental Assessment nor an 

Environmental Impact Statement is 

required. 

Executive Order 13132, Federalism 

The policies contained in this rule do 

not have any substantial direct effect on 

States, on the relationship between the 

National Government and States, or on 

the distribution of power and 

responsibilities among the various 

levels of government. Nor does this final 

rule impose substantial direct 

compliance costs on state and local 

governments. Therefore, consultation 

with the States is not required. 

Regulatory Flexibility Act 

The final rule has been reviewed with 

regard to the requirements of the 

Regulatory Flexibility Act (5 U.S.C. 

601–612). The undersigned has 

determined and certified by signature 

on this document that this final rule 

will not have a significant economic 

impact on a substantial number of small 

entities since this rulemaking action 

does not involve a new or expanded 

program nor does it require any more 

action on the part of a small business 

than required of a large entity. 

Executive Order 12372, 

Intergovernmental Review of Federal 

Programs 

This program is not subject to the 

requirements of Executive Order 12372, 

‘‘Intergovernmental Review of Federal 

Programs,’’ as implemented under 

USDA’s regulations at 7 CFR part 3015. 

Executive Order 13175, Consultation 

and Coordination With Indian Tribal 

Governments 

This Executive order imposes 

requirements on RHS in the 

development of regulatory policies that 

have tribal implications or preempt 

tribal laws. RHS has determined that the 

final rule does not have a substantial 

direct effect on one or more Indian 

tribe(s) or on either the relationship or 

the distribution of powers and 

responsibilities between the Federal 

Government and Indian tribes. Thus, 

this final rule is not subject to the 

requirements of Executive Order 13175. 

If tribal leaders are interested in 

consulting with RHS on this final rule, 

they are encouraged to contact USDA’s 

Office of Tribal Relations or RD’s Native 

American Coordinator at: AIAN@

usda.gov to request such a consultation. 

Programs Affected 

The program affected by this final rule 

is listed in the Assistance Listing 

Number 10.410, Very Low to Moderate 

Income Housing Loans (Section 502 

Rural Housing Loans). 

Paperwork Reduction Act 

This final rule contains no new 

reporting or recordkeeping burdens 

under OMB control number 0575–0179 

that would require approval under the 

Paperwork Reduction Act of 1995 (44 

U.S.C. Chapter 35). 


jspears on DSK121TN23PROD with RULES1
6776 Federal Register / Vol. 87, No. 25 / Monday, February 7, 2022 / Rules and Regulations 

Civil Rights Impact Analysis 

Rural Development has reviewed this 

final rule in accordance with USDA 

Regulation 4300–4, ‘‘Civil Rights Impact 

Analysis,’’ to identify any major civil 

rights impacts the rule might have on 

program participants on the basis of age, 

race, color, national origin, sex, 

disability, marital or familial status. 

Based on the review and analysis of the 

rule and all available data, issuance of 

this final rule is not likely to negatively 

impact low and moderate-income 

populations, minority populations, 

women, Indian tribes or persons with 

disability, by virtue of their age, race, 

color, national origin, sex, disability, or 

marital or familial status. 

E-Government Act Compliance 

Rural Development is committed to 

the E-Government Act, which requires 

Government agencies in general to 

provide the public the option of 

submitting information or transacting 

business electronically to the maximum 

extent possible. 

USDA Non-Discrimination Policy 

In accordance with Federal civil 

rights laws and U.S. Department of 

Agriculture (USDA) civil rights 

regulations and policies, the USDA, its 

Mission Areas, agencies, staff offices, 

employees, and institutions 

participating in or administering USDA 

programs are prohibited from 

discriminating based on race, color, 

national origin, religion, sex, gender 

identity (including gender expression), 

sexual orientation, disability, age, 

marital status, family/parental status, 

income derived from a public assistance 

program, political beliefs, or reprisal or 

retaliation for prior civil rights activity, 

in any program or activity conducted or 

funded by USDA (not all bases apply to 

all programs). Remedies and complaint 

filing deadlines vary by program or 

incident. 

Program information may be made 

available in languages other than 

English. Persons with disabilities who 

require alternative means of 

communication to obtain program 

information (e.g., Braille, large print, 

audiotape, American Sign Language) 

should contact the responsible Mission 

Area, agency, or staff office; the USDA 

TARGET Center at (202) 720–2600 

(voice and TTY); or the Federal Relay 

Service at (800) 877–8339. 

To file a program discrimination 

complaint, a complainant should 

complete a Form AD–3027, USDA 

Program Discrimination Complaint 

Form, which can be obtained online at 

https://www.ocio.usda.gov/document/ 

ad-3027, from any USDA office, by 

calling (866) 632–9992, or by writing a 

letter addressed to USDA. The letter 

must contain the complainant’s name, 

address, telephone number, and a 

written description of the alleged 

discriminatory action in sufficient detail 

to inform the Assistant Secretary for 

Civil Rights (ASCR) about the nature 

and date of an alleged civil rights 

violation. The completed AD–3027 form 

or letter must be submitted to USDA by: 

(1) Mail: U.S. Department of 

Agriculture, Office of the Assistant 

Secretary for Civil Rights, 1400 

Independence Avenue SW, Washington, 

DC 20250–9410; or 

(2) Fax: (833) 256–1665 or (202) 690– 

7442; or 

(3) Email: program.intake@usda.gov. 

USDA is an equal opportunity 

provider, employer, and lender. 

List of Subjects in 7 CFR Part 3555 

Construction, Eligible loan purpose, 

Home improvement, Loan programs— 

housing and community development, 

Loan terms, Mortgage insurance, 

Mortgages, Rural areas. 

For the reasons discussed in the 

preamble, the Agency is amending 7 

CFR part 3555 as follows: 

PART 3555—GUARANTEED RURAL 

HOUSING PROGRAM 

■ 1. The authority citation for part 3555 

continues to read as follows: 

Authority: 5 U.S.C. 301; 42 U.S.C. 1471 et 

seq. 

Subpart C—Loan Requirements 

■ 2. Amend § 3555.107 by revising 

paragraphs (b) introductory text, (b)(1), 

(3), and (6), (c), and (i)(4) to read as 

follows: 

§ 3555.107 Applications for and issuance 

of the loan guarantee. 

* * * * * 

(b) Automated underwriting. 

Approved lenders are required to 

process SFHGLP loans using Rural 

Development’s automated systems. The 

automated underwriting system is a tool 

to help evaluate credit risk but does not 

substitute or replace the careful 

judgment of experienced underwriters 

and shall not be the exclusive 

determination on extending credit. The 

lender must apply for and receive 

approval from Rural Development to 

utilize the automated underwriting 

system. Rural Development reserves the 

right to terminate the lender’s use of the 

automated underwriting system. 

(1) Lenders are responsible for 

ensuring all data is true and accurately 

represented in the automated 

underwriting system. 

* * * * * 

(3) The use of Rural Development’s 

automated underwriting system subjects 

the lender to indemnification 

requirements in accordance with 

§ 3555.108. 

* * * * * 

(6) Lenders will validate findings 

based on the output report of the 

automated underwriting system. 

* * * * * 

(c) Manual underwriting. Loans 

requiring manual underwriting 

(manually underwritten loans) are 

described in paragraphs (c)(1) and (2) of 

this section. For manually underwritten 

loans, full documentation, and 

verification in accordance with subparts 

C, D, and E of this part will be 

submitted to Rural Development when 

requesting a guarantee and maintained 

in the lender’s file. The documentation 

will confirm the applicant’s eligibility, 

creditworthiness, repayment ability, 

eligible loan purpose, adequate 

collateral, and satisfaction of other 

regulatory requirements. The following 

types of loans require manual 

underwriting: 

(1) Loans downgraded by Rural 

Development’s automated system. These 

loans are manually underwritten by the 

lender and submitted utilizing Rural 

Development’s automated system. 

(2) Loans that are not supported by 

Rural Development’s automated 

systems. These loans are manually 

underwritten by the lender and 

submitted by secure email or other 

electronic means approved by the 

Agency. 

* * * * * 

(i)* * * 

(4) For all loan submissions, evidence 

of documentation supporting the 

properly closed loan will be submitted 

using Rural Development’s automated 

systems. 

* * * * * 

Subpart D—Underwriting the Applicant 

■ 3. Amend § 3555.151 by revising 

paragraph (h)(2) introductory text to 

read as follows: 

§ 3555.151 Eligibility requirements. 

* * * * * 

(h) * * * 

(2) The repayment ratio may exceed 

the percentage in paragraph (h)(1) of 

this section when certain compensating 

factors exist. The handbook, HB–1– 

3555, Appendix I, located at https://

www.rd.usda.gov/sites/default/files/hb1-3555.pdf, will provide examples of 


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Federal Register / Vol. 87, No. 25 / Monday, February 7, 2022 / Rules and Regulations 6777 

when a debt ratio waiver may be 

granted. The automated underwriting 

system will consider any compensating 

factors in determining when the 

variance is appropriate. Loans 

downgraded in the automated 

underwriting system which must be 

manually underwritten will require the 

lender to document compensating 

factors. The presence of compensating 

factors does not strengthen a ratio 

exception when multiple layers of risk 

are present in the application. 

Acceptable compensating factors, 

supporting documentation, and 

maximum ratio thresholds, will be 

further defined and clarified in the 

handbook. Compensating factors 

include but are not limited to: 

* * * * * 

Joaquin Altoro, 

Administrator, Rural Housing Service. 

[FR Doc. 2022–02467 Filed 2–4–22; 8:45 am] 

BILLING CODE 3410–XV–P 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 39 

[Docket No. FAA–2021–0791; Project 

Identifier AD–2021–00716–E; Amendment 

39–21881; AD 2021–26–22] 

RIN 2120–AA64 

Airworthiness Directives; General 

Electric Company Turbofan Engines 

AGENCY: Federal Aviation 

Administration (FAA), DOT. 

ACTION: Final rule. 

SUMMARY: The FAA is superseding 

Airworthiness Directive (AD) 2020–20– 

13 for certain General Electric Company 

(GE) CF6–80A and CF6–80C model 

turbofan engines. AD 2020–20–13 

required ultrasonic inspection (UI) of 

high-pressure turbine (HPT) stage 1 and 

stage 2 disks and replacement of any 

HPT stage 1 or stage 2 disk that fails the 

inspection. This AD was prompted by 

an uncontained failure of an HPT stage 

2 disk and the manufacturer’s 

subsequent determination to expand the 

population of affected HPT disks 

requiring UI inspection. This AD 

requires UI of HPT stage 1 and stage 2 

disks and replacement of any HPT stage 

1 or stage 2 disk that fails the 

inspection. This AD also expands the 

applicability to include an additional 

population of affected HPT stage 1 and 

2 disks requiring UI inspection. The 

FAA is issuing this AD to address the 

unsafe condition on these products. 

DATES: This AD is effective March 14, 

2022. 

The Director of the Federal Register 

approved the incorporation by reference 

of certain publications listed in this AD 

as of March 14, 2022. 

ADDRESSES: For service information 

identified in this final rule, contact 

General Electric Company, 1 Neumann 

Way, Cincinnati, OH 45215; phone: 

(513) 552–3272; email: 

aviation.fleetsupport@ge.com; website: 

www.ge.com. You may view this service 

information at the Airworthiness 

Products Section, Operational Safety 

Branch, FAA, 1200 District Avenue, 

Burlington, MA 01803. For information 

on the availability of this material at the 

FAA, call (817) 222–5110. It is also 

available at https://www.regulations.gov 

by searching for and locating Docket No. 

FAA–2021–0791. 

Examining the AD Docket 

You may examine the AD docket at 

https://www.regulations.gov by 

searching for and locating Docket No. 

FAA–2021–0791; or in person at Docket 

Operations between 9 a.m. and 5 p.m., 

Monday through Friday, except Federal 

holidays. The AD docket contains this 

final rule, any comments received, and 

other information. The address for 

Docket Operations is U.S. Department of 

Transportation, Docket Operations, M– 

30, West Building Ground Floor, Room 

W12–140, 1200 New Jersey Avenue SE, 

Washington, DC 20590. 

FOR FURTHER INFORMATION CONTACT: 

Sungmo Cho, Aviation Safety Engineer, 

ECO Branch, FAA, 1200 District 

Avenue, Burlington, MA 01803; phone: 

(781) 238–7241; fax: (781) 238–7199; 

email: Sungmo.D.Cho@faa.gov. 

SUPPLEMENTARY INFORMATION: 

Background 

The FAA issued a notice of proposed 

rulemaking (NPRM) to amend 14 CFR 

part 39 to supersede AD 2020–20–13, 

Amendment 39–21269 (85 FR 63193, 

October 7, 2020), (AD 2020–20–13). AD 

2020–20–13 applied to certain GE CF6– 

80A, CF6–80A1, CF6–80A2, CF6–80A3, 

CF6–80C2A1, CF6–80C2A2, CF6– 

80C2A3, CF6–80C2A5, CF6–80C2A5F, 

CF6–80C2A8, CF6–80C2B1, CF6– 

80C2B1F, CF6–80C2B2, CF6–80C2B2F, 

CF6–80C2B4, CF6–80C2B4F, CF6– 

80C2B5F, CF6–80C2B6, CF6–80C2B6F, 

CF6–80C2B6FA, CF6–80C2B7F, CF6– 

80C2D1F, CF6–80C2L1F, and CF6– 

80C2K1F model turbofan engines. The 

NPRM published in the Federal 

Register on October 6, 2021 (86 FR 

55545). The NPRM was prompted by an 

uncontained failure of an HPT stage 2 

disk and the manufacturer’s 

determination to expand the population 

of affected HPT disks requiring UI 

inspection. After the FAA issued AD 

2020–20–13, the manufacturer 

discovered an error in the service 

information and determined that the 

requirement to perform UI of affected 

HPT stage 1 and 2 disks should be 

expanded to include an additional 

population of HPT stage 1 and stage 2 

disks. GE, therefore, revised its service 

information to include the additional 

affected HPT stage 1 and stage 2 disks. 

In the NPRM, the FAA proposed to 

continue to require UI of HPT stage 1 

and stage 2 disks and replacement of 

any HPT stage 1 or stage 2 disk that fails 

the inspection. In the NPRM, the FAA 

also proposed to expand the 

applicability to include an additional 

population of affected HPT stage 1 and 

2 disks. 

Discussion of Final Airworthiness 

Directive 

Comments 

The FAA received comments from 

two commenters. Commenters included 

the Air Line Pilots Association, 

International and FedEx Express. All 

commenters supported the NPRM 

without change. 

Conclusion 

The FAA reviewed the relevant data, 

considered the comments received, and 

determined that air safety requires 

adopting the AD as proposed. 

Accordingly, the FAA is issuing this AD 

to address the unsafe condition on these 

products. Except for minor editorial 

changes, this AD is adopted as proposed 

in the NPRM. None of the changes will 

increase the economic burden on any 

operator. 

Related Service Information Under 1 

CFR Part 51 

The FAA reviewed GE CF6–80C 

Service Bulletin (SB) 72–1562 R05, 

dated March 19, 2021. This SB specifies 

procedures for UI of CF6–80C2 turbofan 

engine HPT stage 1 and 2 disks. The 

FAA also reviewed GE CF6–80A SB 72– 

0869 R03, dated March 19, 2021. This 

SB specifies procedures for UI of CF6– 

80A turbofan engine HPT stage 2 disks. 

These documents are distinct since they 

apply to different engine models. This 

service information is reasonably 

available because the interested parties 

have access to it through their normal 

course of business or by the means 

identified in ADDRESSES. 


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