USDA Technical Handbook HB-1-3555 §12.25 — Cash Back To Borrower

usda-hb-3555-12-25

USDA HB-1-3555 §12.25 (Cash Back To Borrower). Gap-fill (verbatim).

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source:
  type: regulation
  id: usda-hb-3555-12.25
  authority: USDA Technical Handbook HB-1-3555 §12.25 — Cash Back To Borrower
  description: |
    USDA HB-1-3555 §12.25 (Cash Back To Borrower). Gap-fill (verbatim). 
obligations:
  - id: usda-hb-3555-12.25-0
    canonical_id: usda-hb-3555-12.25-0
    section: USDA HB-1-3555 12.25 — Cash Back To Borrower
    description: '12.25 Cash Back To Borrower: SH BACK TO BORROWER The borrower is not to receive funds after closing. Lenders must apply any excess funds from the construction proceeds to reduce the principal balance of the permanent loan. In the event funds remain after closing from unused prepaid expenses including, but no…'
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    secondary_owner_role: ''
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    tags:
      - regulator-direct
      - gap-fill
      - usda-hb-3555
      - section-complete
    primary_source:
      tier: 1
      authority: USDA Technical Handbook HB-1-3555 §12.25 — Cash Back To Borrower
      source_class: usda-handbook-hb-1-3555
      source_url: https://www.rd.usda.gov/resources/directives/handbooks
      snapshot_id: 0466acd1ea2d17a4
      fetched_at: '2026-06-18T00:00:00+00:00'
      content_hash: sha256:22ac6f998ff72578e318fca138ebe80fb18ae2fc701eb5936172f1842679a13a
      paragraph_quote: SH BACK TO BORROWER The borrower is not to receive funds after closing. Lenders must apply any excess funds from the construction proceeds to reduce the principal balance of the permanent loan. In the event funds remain after closing from unused prepaid expenses including, but not limited to, per diem interest to the end of the month on the new loan, hazard insurance premium deposits, and/or real estate tax deposits needed to establish the escrow accounts, the borrower may receive cash back if the borrower paid these items from their personal funds and they do not represent loan funds. Funds that remain in the contingency reserve account after the completion of construction may be utilized for an eligible loan purpose or applied to the principal balance of the permanent loan.
      drafter_attestation: Verbatim from HB-1-3555 §12.25 body (max-gap occurrence), snapshot 0466acd1ea2d17a4; substring-verified.

Verbatim regulatory text (1)

Verbatim provisions from USDA Technical Handbook HB-1-3555 §12.25 — Cash Back To Borrower — 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.

USDA HB-1-3555 12.25 — Cash Back To Borrower

SH BACK TO BORROWER The borrower is not to receive funds after closing. Lenders must apply any excess funds from the construction proceeds to reduce the principal balance of the permanent loan. In the event funds remain after closing from unused prepaid expenses including, but not limited to, per diem interest to the end of the month on the new loan, hazard insurance premium deposits, and/or real estate tax deposits needed to establish the escrow accounts, the borrower may receive cash back if the borrower paid these items from their personal funds and they do not represent loan funds. Funds that remain in the contingency reserve account after the completion of construction may be utilized for an eligible loan purpose or applied to the principal balance of the permanent loan.

Source: USDA Technical Handbook HB-1-3555 §12.25 — Cash Back To Borrower · source URL · snapshot 0466acd1ea2d17a4

Operationalizing USDA Technical Handbook HB-1-3555 §12.25 — Cash Back To Borrower

This is verbatim, source-snapshotted regulator text from the Claude for Compliance open corpus. To turn a rule like this into compliance work product: gap-analyze your policies and procedures (P&Ps) against these requirements to surface stale, conflicting, or missing provisions; operationalize any change with a ready-to-run update kit; and produce audit-ready evidence — every step grounded only in the regulator’s own words, never invented.

Source of record: https://claudeforcompliance.com/regs/usda-hb-3555-12-25/ · register usda-hb-3555-12-25 · Claude for Compliance. Free to read and download; see regulatory updates and methodology.