FR Doc. 2026-05387 — Single Family Housing Guaranteed Loan Program (Final rule)
FR Doc. 2026-05387 (91 FR 13211, March 19, 2026) — USDA Rural Housing Service Final rule amending 7 CFR part 3555 to grant Delegated Lenders authority to make SFHGLP loans and obtain Loan Note Guarantees after closing via the Agency's automated underwriting and closing systems. Adds Sec. 3555.55 and a Delegated Lender definition; removes the Sec. 3555.107(i)(5) self-certification option. Effective June 17, 2026. Verbatim, snapshot-verified.
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Verbatim regulatory text
Verbatim provisions from FR Doc. 2026-05387 — Single Family Housing Guaranteed Loan Program (Final rule) — each quote is a verified substring of the regulator-published source snapshot, not retyped. Quoted for reference; this is not legal advice. The operational layer (P&P updates, prompts) lives in the regulation update kits.
Agency and Action
AGENCY: Rural Housing Service, USDA. ACTION: Final rule.
Summary
The Rural Housing Service (RHS or Agency), a Rural Development (RD) Agency within the United States Department of Agriculture (USDA), is amending its regulations to grant Delegated Lenders participating in the Single-Family Housing Guaranteed Loan Program (SFHGLP) the authority to make loans and obtain Loan Note Guarantees after closing using automated loan underwriting and closing systems.
Dates — Effective date
This Final rule is effective June 17, 2026. Implementation will occur on September 28, 2028. The Agency will publish a notice in the Federal Register prior to implementation.
Statutory Authority
Section 201 of the Housing Opportunity Through Modernization Act of 2016 (Pub. L. 114-201) (42 U.S.C. 1472(h)(18)) authorizes the Secretary to delegate loan approval authority to certain preferred lenders, and Section 510(k) of Title V of 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.
Summary of Rule Changes
Upon implementation of the Final rule, loan approval and issuance of the Loan Note Guarantee will be delegated to the Delegated Lender. Delegated Lenders will be required to use Agency automated loan underwriting and closing systems to originate, process, close, and service loan applications in accordance with the published regulations and handbook guidance.
Sec. 3555.10 — Definition of Delegated Lender
Delegated Lender. An entity that meets the requirements under Sec. 3555.51 and has been delegated authority by the Agency to underwrite and approve loans that meet the requirements of this part without prior review and approval by Agency staff, unless provided otherwise in this part.
Sec. 3555.55(a) — General requirements
The Agency may approve certain lenders for Delegated Lender status as defined in Sec. 3555.10. The Delegated Lender assumes the responsibility for meeting all loan requirements on behalf of the Agency for the purposes of pre-closing loan processing, loan approval, and post-closing issuance of loan guarantee under subparts C, D, and E of this part with the following exceptions and clarifications:
Sec. 3555.55(b) — Modifications
The following regulatory provisions in subpart A of this part are not applicable to Delegated Lenders or are modified as described in paragraphs (b)(1) and (2) of this section: (1) Applications processed by Delegated Lenders with a conflict of interest under Sec. 3555.8 are not subject to the requirements under Sec. 3555.8(d). The other paragraphs of Sec. 3555.8 still apply.
Sec. 3555.55(c) — Eligibility
Lenders must be approved to participate in the SFHGLP as provided in Sec. 3555.51 and meet the following requirements: (1) Have participated in the SFHGLP for at least the previous two years; (2) Met the performance standards established by the Agency for delinquency, default, loss claims, etc. for the previous two years; and (3) Complete Agency sponsored training each year.
Sec. 3555.55(d) — Automated underwriting system
Delegated lenders must use the Agency's automated underwriting system as described in Sec. 3555.107(b).
Sec. 3555.55(e) — Oversight
The Agency will monitor lender performance through the regular use of loan level data and lender oversight and monitoring reviews.
Sec. 3555.55(f) — Termination of delegated authority
The Agency may suspend or terminate the lender's delegated status for reasons including, but not limited to: (i) Approving loans that do not meet Agency guidelines. (ii) Providing data to the Agency's automated underwriting system which is not supported by documentation retained by the lender. (iii) Unacceptable portfolio performance as evidenced by delinquency, loss claim, default rates, material deficiencies, or any other performance metric established by the Agency; and (iv) Noncompliance with other requirements described in Sec. 3555.51, or if the Agency determines that other good cause exists.
Sec. 3555.55(g) — Revocation of delegated status
Delegated Lenders will retain delegated status until revoked by the Agency or withdrawn by the lender. If the Agency revokes the delegated authority of a Delegated Lender, the Delegated Lender will be given appeal rights as specified in Sec. 3555.4. This is distinct from termination from participation in the SFHGLP under Sec. 3555.52.
Sec. 3555.55(h) — Administration of delegated program
The Agency may adjust, modify, or cancel the Delegated Lender program based on overall program considerations such as budget, program performance, and program integrity.
Sec. 3555.107 [Amended] — removal of self-certification option
Amend Sec. 3555.107 by removing paragraph (i)(5).