PROCEDURE NOTICE

RD MANUAL CHANGES

INSERT RD INS 440.1 (WSAL)

INTEREST RATES, AMORTIZATION, GUARANTEE FEE, ANNUAL CHARGE, AND FIXED PERIOD. This Instruction is partially revised as follows:

Exhibit B: To update the Treasury Judgement rate and the effective date of November 1, 2025; and

INSERT RD INS 2006-M (WSAL)

MANAGEMENT CONTROL SYSTEM. This Instruction is revised to clarify procedures, remove outdated procedures, add current procedures, update/add/remove organizational references for changes in organizational structures, add/remove relevant definitions, and remove obsolete exhibits.

Title updated from Management Control System to Internal Control System.

The Table of Contents has been updated to remove numerous sections that were obsolete due to processes or organization components that no longer exist, add numerous sections that exist for processes or organization components that replaced those removed. Indexes updated accordingly. TOC changes include:

• Section 2006.605(d) Management Control Advisory Group (MCAG) replaced with 2006.605 (d) Director, Internal Compliance Division (ICD).
• Section 2006.605 (e) Director, Financial Management Division (FMD) replaced with 2006.605 (e) State Operations.
• Section 2006.605 (f) State Directors. replaced with 2006.605 (f) Internal Compliance Division (ICD) Branches.

RD HANDBOOK CHANGES

INSERT RD HB-1-3555 (WSAL)

SFH GUARANTEED LOAN PROGRAM TECHNICAL HANDBOOK. The following updates were made to HB-1-3555, Chapter 11 to permit a PITI ratio up to 29%, revise guidance pertaining to the availability of ratio waivers, provide clarification on the treatment of debts, and make minor grammatical and formatting edits.

Paragraph 11.2 – The Ratios

• Updated the PITI ratio guidelines to reflect 29%.
• Clarified if an applicant pays off a debt to qualify, the lender must document the source of funds used.
• Clarified that to exclude a debt paid by another party, that party must be legally obligated to pay the debt.
• Clarified the Agency’s guidelines on contingent liabilities.

Paragraph 11.3 Debt Ratio Waivers and Compensating Factors

• Updated to clarify that ratio waivers are permissible if the requirements cited are met.

FORM

NEW

RD 3560-80 (WSAL) REPLACEMENT RESERVE INTERCREDITOR AGREEMENT dated 11-25. Prescribed in 7 CFR Part 3560 and 7 CFR Part 3565. This is a new Form to standardize the terms for reserve account withdraws when a Borrower has a loan from both USDA's Section 515 direct loan program and from a Lender approved under USDA's Section 538 guaranteed rural rental housing program. By adopting standardized terms, the Borrower does not have to maintain separate reserve accounts for USDA and the 538 Lender. Additionally, the combined reserve account is governed by standardized procedures. This form requires the identification of the three parties to the transactions (USDA, 538 Lender, and Borrower), the individual loans and loan amounts, the affordable housing project that is collateral for both loans, and the signatures of the three parties' authorized representatives. The Form and FMI can be located on the eForms website eForms Home (usda.gov).

INSERT FMI dated 11-25-25.

REPLACEMENT

RD 3560-9 (WSAL) MULTIPLE FAMILY HOUSING INTEREST CREDIT AGREEMENT dated 11-25. Prescribed in CFR part 3560, subpart B and HB-2-3560. The Form and FMI are being revised to remove references to Servicing Office and State Director and replaced with Leadership Designee. The Form and FMI can be located on the eForms website eForms Home (usda.gov).

RD 3560-17 (WSAL) MULTIPLE FAMILY HOUSING NOTE CONSOLIDATION dated 11-25. Prescribed in 7 CFR part 3560, HB-3-3560, AMAS Manual, Chapter 4. The Form and FMI are being revised to remove references to State Director and replaced with Leadership Designee. The Form and FMI can be located on the eForms website eForms Home (usda.gov).

RD 3560-17A (WSAL) MULTIPLE FAMILY HOUSING CONSOLIDATION OF PROJECTS/LOAN AGREEMENTS/RESOLUTIONS dated 11-25. Prescribed in 7 CFR part 3560, HB-3-3560, AMAS Manual, Chapter 4. The Form and FMI are being revised to remove references to State Director and replaced with Leadership Designee. The Form and FMI can be located on the eForms website eForms Home (usda.gov).

RD 3560-21 (WSAL) MULTIPLE FAMILY HOUSING ASSUMPTION AGREEMENTS dated 11-25. Prescribed in 7 CFR part 3560 and HB-3-3560. The Form and FMI are being revised to remove references to Field Office and State Director and replaced with Leadership Designee. The Form and FMI can be located on the eForms website eForms Home (usda.gov).

RD 3560-28 (WSAL) MULTIPLE FAMILY HOUSING EXCEPTION TO LATE FEES dated 11-25. Prescribed in 7 CFR part 3560 and HB-3-3560. The Form and FMI are being revised to remove references to Field Office and State Director and replaced with Leadership Designee. The Form and FMI can be located on the eForms website eForms Home (usda.gov).

RD 3560-50 (WSAL) MULTIPLE FAMILY HOUSING CONVERSION AGREEMENT dated 11-25. Prescribed in 7 CFR part 3560 and HB-3-3560 and AMAS Manual. The Form and FMI are being revised to remove references to Field Office and State Director and replaced with Leadership Designee. The Form and FMI can be located on the eForms website eForms Home (usda.gov).

RD 3560-56 (WSAL) REPORT ON REAL ESTATE PROBLEM CASE dated 11-25. Prescribed in HB-3-3560. The Form and FMI are being revised to remove references to State Office and State Director and replaced with Leadership Designee. The Form and FMI can be located on the eForms website eForms Home (usda.gov).

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