source:
  type: regulation
  id: usda-7cfr-3555.51
  authority: 7 CFR §3555.51 — Lender eligibility
  description: '7 CFR §3555.51 sets the USDA SFHGLP lender-eligibility and

    participation requirements.

    '
obligations:
- id: usda-7cfr-3555.51-full
  canonical_id: usda-7cfr-3555.51-full
  section: 7 CFR §3555.51
  description: A lender must meet the requirements described in this section to be approved for participation
    in the SFHGLP .
  type: do
  tags:
  - regulator-direct
  - section-complete
  - cfpb-regulation
  primary_source:
    tier: 1
    authority: 7 CFR §3555.51(a)
    source_class: usda-regulation
    source_url: https://www.law.cornell.edu/cfr/text/7/3555.51
    snapshot_id: 5594a02859f202f4
    fetched_at: '2026-05-22T18:52:48Z'
    content_hash: sha256:a5c172b7a3126f233c5e1cdeac5ac228afcb133c22d40c0f51aff58ca0ad3e11
    paragraph_quote: A lender must meet the requirements described in this section to be approved for
      participation in the SFHGLP .
    drafter_attestation: Verbatim subsection of 7 CFR §3555.51 from Cornell LII snapshot 5594a02859f202f4;
      body isolated between nav and notes; substring-verified.
  judgment: false
- id: usda-7cfr-3555.51-a
  canonical_id: usda-7cfr-3555.51-a
  section: 7 CFR §3555.51(a)
  description: '(a): (a) Ability to underwrite and service loans. The lender must have a demonstrated
    ability to underwrite and service single-family home loans. A lender will be considered to have such
    a demonstrated ability if it qualifies as one of the following: (1) A State Housing Agency ; (2) A
    lender approved as …'
  type: do
  tags:
  - regulator-direct
  - section-complete
  - cfpb-regulation
  primary_source:
    tier: 1
    authority: 7 CFR §3555.51(a)
    source_class: usda-regulation
    source_url: https://www.law.cornell.edu/cfr/text/7/3555.51
    snapshot_id: 5594a02859f202f4
    fetched_at: '2026-05-22T18:52:48Z'
    content_hash: sha256:a5c172b7a3126f233c5e1cdeac5ac228afcb133c22d40c0f51aff58ca0ad3e11
    paragraph_quote: '(a) Ability to underwrite and service loans. The lender must have a demonstrated
      ability to underwrite and service single-family home loans. A lender will be considered to have
      such a demonstrated ability if it qualifies as one of the following: (1) A State Housing Agency
      ; (2) A lender approved as a supervised or nonsupervised mortgagee by HUD with direct endorsement
      authority for submission of applications for Federal Housing Mortgage Insurance; (3) A supervised
      or nonsupervised mortgagee with authority to close VA -guaranteed loans on the automatic basis;
      (4) A lender approved by Fannie Mae for single-family loans; (5) A lender approved by Freddie Mac
      for single-family loans; (6) A Farm Credit System institution that provides documentation of its
      ability to underwrite and service single-family loans. Lenders who are a Farm Credit System lender
      with direct lending authority meet demonstrated ability; (7) A lender participating in other Rural
      Development or Farm Service Agency guaranteed loan programs that provide documentation of its ability
      to underwrite and service single family loans. Documentation criteria for other Rural Development
      or Farm Service Agency guarantee loan programs require an active lender agreement ; or (8) A Federally
      supervised lender that provides documentation of its ability to originate, underwrite, and service
      single-family loans. Acceptable sources of supervision include:'
    drafter_attestation: Verbatim subsection of 7 CFR §3555.51 from Cornell LII snapshot 5594a02859f202f4;
      body isolated between nav and notes; substring-verified.
  judgment: false
- id: usda-7cfr-3555.51-i
  canonical_id: usda-7cfr-3555.51-i
  section: 7 CFR §3555.51(i)
  description: '(i): (i) Being a member of the Federal Reserve System . (ii) The Federal Deposit Insurance
    Corporation (FDIC). (iii) The National Credit Union Administration (NCUA). (iv) The Office of the
    Comptroller of the Currency (OCC).'
  type: do
  tags:
  - regulator-direct
  - section-complete
  - cfpb-regulation
  primary_source:
    tier: 1
    authority: 7 CFR §3555.51(a)
    source_class: usda-regulation
    source_url: https://www.law.cornell.edu/cfr/text/7/3555.51
    snapshot_id: 5594a02859f202f4
    fetched_at: '2026-05-22T18:52:48Z'
    content_hash: sha256:a5c172b7a3126f233c5e1cdeac5ac228afcb133c22d40c0f51aff58ca0ad3e11
    paragraph_quote: (i) Being a member of the Federal Reserve System . (ii) The Federal Deposit Insurance
      Corporation (FDIC). (iii) The National Credit Union Administration (NCUA). (iv) The Office of the
      Comptroller of the Currency (OCC).
    drafter_attestation: Verbatim subsection of 7 CFR §3555.51 from Cornell LII snapshot 5594a02859f202f4;
      body isolated between nav and notes; substring-verified.
  judgment: false
- id: usda-7cfr-3555.51-v
  canonical_id: usda-7cfr-3555.51-v
  section: 7 CFR §3555.51(v)
  description: '(v): (v) The Federal Housing Finance Board regulating lenders within the Federal Home-Loan
    Bank (FHLB) system. (9) If lenders cannot meet the requirements under paragraphs (a)(1) through (8)
    of this section, they may demonstrate its ability to originate and underwrite loans by submitting
    appropriate docu…'
  type: do
  tags:
  - regulator-direct
  - section-complete
  - cfpb-regulation
  primary_source:
    tier: 1
    authority: 7 CFR §3555.51(a)
    source_class: usda-regulation
    source_url: https://www.law.cornell.edu/cfr/text/7/3555.51
    snapshot_id: 5594a02859f202f4
    fetched_at: '2026-05-22T18:52:48Z'
    content_hash: sha256:a5c172b7a3126f233c5e1cdeac5ac228afcb133c22d40c0f51aff58ca0ad3e11
    paragraph_quote: '(v) The Federal Housing Finance Board regulating lenders within the Federal Home-Loan
      Bank (FHLB) system. (9) If lenders cannot meet the requirements under paragraphs (a)(1) through
      (8) of this section, they may demonstrate its ability to originate and underwrite loans by submitting
      appropriate documentation , examples of which include, but are not limited to:'
    drafter_attestation: Verbatim subsection of 7 CFR §3555.51 from Cornell LII snapshot 5594a02859f202f4;
      body isolated between nav and notes; substring-verified.
  judgment: false
- id: usda-7cfr-3555.51-i
  canonical_id: usda-7cfr-3555.51-i
  section: 7 CFR §3555.51(i)
  description: '(i): (i) A summary of residential mortgage lending activity . (ii) Written criteria outlining
    the lender ''s policy and procedures for originating, underwriting and closing residential mortgage
    loans. (iii) Evidence of an experienced loan underwriter on staff. (iv) Certification the lender will
    contract w…'
  type: do
  tags:
  - regulator-direct
  - section-complete
  - cfpb-regulation
  primary_source:
    tier: 1
    authority: 7 CFR §3555.51(a)
    source_class: usda-regulation
    source_url: https://www.law.cornell.edu/cfr/text/7/3555.51
    snapshot_id: 5594a02859f202f4
    fetched_at: '2026-05-22T18:52:48Z'
    content_hash: sha256:a5c172b7a3126f233c5e1cdeac5ac228afcb133c22d40c0f51aff58ca0ad3e11
    paragraph_quote: '(i) A summary of residential mortgage lending activity . (ii) Written criteria outlining
      the lender ''s policy and procedures for originating, underwriting and closing residential mortgage
      loans. (iii) Evidence of an experienced loan underwriter on staff. (iv) Certification the lender
      will contract with an Agency -approved lender meeting the criteria to participate in the program
      as a servicer. (10) A lender that proposes to service loans that cannot meet paragraphs (a)(1) through
      (8) of this section must demonstrate its ability by submitting appropriate documentation , examples
      of which include but are not limited to:'
    drafter_attestation: Verbatim subsection of 7 CFR §3555.51 from Cornell LII snapshot 5594a02859f202f4;
      body isolated between nav and notes; substring-verified.
  judgment: false
- id: usda-7cfr-3555.51-i
  canonical_id: usda-7cfr-3555.51-i
  section: 7 CFR §3555.51(i)
  description: '(i): (i) Evidence of a written plan when contracting for escrow services. (ii) Evidence
    the lender has serviced single-family residential mortgage loans in the year prior to request lender
    approval to participate in the SFHGLP . (11) The financial requirements for non-supervised lenders
    not covered in pa…'
  type: do
  tags:
  - regulator-direct
  - section-complete
  - cfpb-regulation
  primary_source:
    tier: 1
    authority: 7 CFR §3555.51(a)
    source_class: usda-regulation
    source_url: https://www.law.cornell.edu/cfr/text/7/3555.51
    snapshot_id: 5594a02859f202f4
    fetched_at: '2026-05-22T18:52:48Z'
    content_hash: sha256:a5c172b7a3126f233c5e1cdeac5ac228afcb133c22d40c0f51aff58ca0ad3e11
    paragraph_quote: '(i) Evidence of a written plan when contracting for escrow services. (ii) Evidence
      the lender has serviced single-family residential mortgage loans in the year prior to request lender
      approval to participate in the SFHGLP . (11) The financial requirements for non-supervised lenders
      not covered in paragraph (a)(8), must have:'
    drafter_attestation: Verbatim subsection of 7 CFR §3555.51 from Cornell LII snapshot 5594a02859f202f4;
      body isolated between nav and notes; substring-verified.
  judgment: false
- id: usda-7cfr-3555.51-i
  canonical_id: usda-7cfr-3555.51-i
  section: 7 CFR §3555.51(i)
  description: '(i): (i) A minimum adjusted net worth of $250,000, or $50,000 in working capital plus
    one percent of the total volume in excess of $25 million in guaranteed loans originated, serviced,
    or purchased during the lender ''s prior fiscal year , up to a maximum required adjusted net worth
    of $2.5 million, and (…'
  type: do
  tags:
  - regulator-direct
  - section-complete
  - cfpb-regulation
  primary_source:
    tier: 1
    authority: 7 CFR §3555.51(a)
    source_class: usda-regulation
    source_url: https://www.law.cornell.edu/cfr/text/7/3555.51
    snapshot_id: 5594a02859f202f4
    fetched_at: '2026-05-22T18:52:48Z'
    content_hash: sha256:a5c172b7a3126f233c5e1cdeac5ac228afcb133c22d40c0f51aff58ca0ad3e11
    paragraph_quote: (i) A minimum adjusted net worth of $250,000, or $50,000 in working capital plus
      one percent of the total volume in excess of $25 million in guaranteed loans originated, serviced,
      or purchased during the lender 's prior fiscal year , up to a maximum required adjusted net worth
      of $2.5 million, and (ii) One or more lines of credit with a minimum aggregate of one million dollars.
    drafter_attestation: Verbatim subsection of 7 CFR §3555.51 from Cornell LII snapshot 5594a02859f202f4;
      body isolated between nav and notes; substring-verified.
  judgment: false
- id: usda-7cfr-3555.51-b
  canonical_id: usda-7cfr-3555.51-b
  section: 7 CFR §3555.51(b)
  description: '(b): (b) SFHGLP participation requirements. Lenders and their agents must comply with
    the following requirements: (1) Keep up to date, and comply with, all Agency regulations and handbooks,
    including all amendments and revisions of program requirements and policies. Lenders must also comply
    with all othe…'
  type: do
  tags:
  - regulator-direct
  - section-complete
  - cfpb-regulation
  primary_source:
    tier: 1
    authority: 7 CFR §3555.51(a)
    source_class: usda-regulation
    source_url: https://www.law.cornell.edu/cfr/text/7/3555.51
    snapshot_id: 5594a02859f202f4
    fetched_at: '2026-05-22T18:52:48Z'
    content_hash: sha256:a5c172b7a3126f233c5e1cdeac5ac228afcb133c22d40c0f51aff58ca0ad3e11
    paragraph_quote: '(b) SFHGLP participation requirements. Lenders and their agents must comply with
      the following requirements: (1) Keep up to date, and comply with, all Agency regulations and handbooks,
      including all amendments and revisions of program requirements and policies. Lenders must also comply
      with all other applicable federal, state , and local laws, rules, and requirements, including those
      under the purview of the Consumer Financial Protection Bureau, such as the Real Estate Settlement
      Procedures Act and the Truth in Lending Act . Lenders who originate a minimal number loans, as determined
      by the Agency , in a 24 month time frame may be required to take updated training to ensure a lender
      ''s continued knowledge of the program; (2) Regularly check Rural Development ''s Web site for new
      issuances related to the program; (3) Underwrite loans according to Rural Development regulations
      and process and approve loans in accordance with program instructions; (4) Review loan applications
      for accuracy and completeness, (5) Ensure that applicant income limits are not exceeded; (6) Ensure
      that borrowers have adequate loan repayment ability and acceptable credit histories; (7) Ensure
      that loss claims include only supportable costs; (8) Cooperate fully with Agency reporting and monitoring
      requirements; (9) Comply with limitations on loan purposes, loan limitations, interest rates, and
      loan terms; (10) Inform Rural Development immediately after the sale , transfer, or change of servicers
      of any Agency guaranteed loan ; (11) Maintain reasonable and prudent business practices consistent
      with generally accepted mortgage industry standards, such as maintaining fidelity bonding; (12)
      Remain responsible for servicing even if servicing has been contracted to a third party ; (13) Use
      Rural Development , HUD , Fannie Mae , or Freddie Mac forms, unless otherwise approved by Rural
      Development ; (14) Maintain eligibility under paragraph (a) of this section; (15) Notify Rural Development
      if there are any material changes in organization or practices; (16) Be neither debarred nor suspended
      from participation in Federal programs, not debarred, suspended or sanctioned under state licensing
      and certification laws and regulation; (17) Notify Rural Development in the event of its bankruptcy
      or insolvency; (18) Remain free from default and delinquency on any debt owed to the Federal government
      ; (19) Allow Rural Development or its representative access to the lender ''s records, including,
      but not limited to, records necessary for on-site and desk reviews of the lender ''s operation and
      the operations of any of its agents to verify compliance with Agency regulations and guidelines;
      (20) Maintain adequate operational quality control and reporting procedures to prevent mortgage
      fraud; (21) Maintain complete loan files with all required documentation that is accessible by the
      Agency upon request for review; and (22) Execute a lender ''s agreement provided by Rural Development
      . (23) Provide documentation as required by the Agency to be reviewed every two years for lender
      participation and, (24) Provide evidence that principal officers have a minimum of two years of
      experience in originating or servicing guaranteed mortgage loans as recommended in OMB Circular
      A-129. [ 78 FR 73941 , Dec. 9, 2013, as amended at 84 FR 70886 , Dec. 26, 2019; 87 FR 53371 , Aug.
      31, 2022] Truth in Lending Act CFR Toolbox Law about... Articles from Wex Table of Popular Names
      Parallel Table of Authorities Accessibility About LII Contact us Advertise here Help Terms of use
      Privacy'
    drafter_attestation: Verbatim subsection of 7 CFR §3555.51 from Cornell LII snapshot 5594a02859f202f4;
      body isolated between nav and notes; substring-verified.
  judgment: false
