Application approval times for Section 504 loans are killing our Self-Help rehab program! We are a Self-Help rehab grantee and have been told that Section 504 Self-Help Loan applications do not receive priority four processing and as a result, we are waiting about 9 months to get loan eligibility. In reviewing the language in Appendix 13 there does not appear to be any distinction between 502 and 504 but just says “Self-Help applications receive a priority four,” do you have any insight or better language on this?
504 Eligibility Woes
Dear 504 Eligibility Woes,
I looked through the handbooks, guides, CFR and anything I could find and I don’t see any distinction between 502 and 504 when it comes to priority processing for Self-Help either. So, I went to directly to the source on this one and reached out to Andria Hively, Branch Chief, Special Programs, Single Family Housing Direct Loan Division who graciously responded:
“My intent was definitely for ALL (502/504) Self-Help applications to be considered a priority 4 for the reasons stated in Appendix 13.”
I saw in the new Self-Help Appendix 13 that I need to follow the process in Attachment 3-A including the applicant disclosure letter, what is an applicant disclosure letter?
Great question! The applicant disclosure letter is a document signed by the Section 502 Loan applicant that enables RD to share everything with the grantee including talking about the file, including personal and financial information, decision letters, appraisals, etc. There is a template in HB-1-3550, Attachment 3-A Microsoft Word – 3550-1chapter03 (usda.gov) where you can just cut and paste the language onto your letterhead and add the applicable information where indicated with brackets, just remember the fee is $0 for Self-Help applicants (your 523 grant pays for this)!
Also in this issue of Self-Help Builder:
- An interview with Cathy Glover, USDA RD Deputy Administrator of Single-Family Housing
- Self-Help Do Not Pay (DNP) clearance and Department of Labor notification requirements