source:
  type: guide
  id: hud-4000-1-ii-a-direct-loans
  authority: FHA Single Family Housing Policy Handbook 4000.1, Part II — a. Direct
    Loans (09/26/2022)
  description: FHA Single Family Housing Policy Handbook 4000.1, Part II — a. Direct
    Loans (09/26/2022).
  coverage_tier: operative
obligations:
- id: hud-4000-1-ii-a-direct-loans-full
  canonical_id: hud-4000-1-ii-a-direct-loans-full
  section: FHA Single Family Housing Policy Handbook 4000.1, Part II — a. Direct Loans
    (09/26/2022)
  type: do
  tags:
  - regulator-direct
  - fha
  - hud-handbook
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: FHA Single Family Housing Policy Handbook 4000.1, Part II — a. Direct
      Loans (09/26/2022)
    source_class: hud-handbook
    source_url: https://www.hud.gov/hud-partners/single-family-handbook-4000-1
    snapshot_id: 8c03836f77f317e1
    fetched_at: '2026-05-23T00:28:40Z'
    content_hash: sha256:411430f29b13f9b54a2ebb0e6f6e7087ecd2b90d0da22eb0c8c792eaa2d7d0df
    paragraph_quote: a. Direct Loans (09/26/2022) i. Definition A Direct Loan process
      refers to where the Borrower applies directly to the Lender or its sponsored
      TPO for the Loan without assistance from a Dealer, contractor, or third party
      that has a financial interest in the loan transaction. ii. Standard The credit
      application, signed by the Borrower, may be filled out by the Borrower or by
      a person acting at the direction of the Borrower who does not have a financial
      interest in the loan transaction. For a Direct Loan purchase transaction, loan
      proceeds are disbursed to the Borrower and seller jointly. However, the Borrower
      may provide the Lender with an executed assignment of Borrower’s interest in
      the loan proceeds to the seller on or before the date of disbursement to properly
      complete payment. For a Direct Loan refinance transaction, proceeds are disbursed
      to the Note holder of the Loan being paid off.
  judgment: false
