| • | Rural Development Guaranteed Rural Housing loans are typically underwritten to Rural Development Instruction §1980.345(d). |
Additional specific requirements:
| • | The total debt ratio should include revolving debt regardless of when the debt will be retired. Installment loans will only be considered if the debt will be retired in more than six months. However, if the monthly payment on the debt is substantial, the payment will also be included in long term debt. |
| • | If the borrower has co-signed a loan for another party, an acceptable 12- month history validating that the borrower is not making the payment must be provided in order to exclude the payment from the total debt. |
| • | When a borrower has a delinquent student loan obligation, a satisfactory six month repayment history must be provided. |
| • | A 24-month history of residence is required on all files. Additionally, a 12- month verification of rent or mortgage with a payment rating is also required on all files when the primary wage earner has a credit score of less than 620. This may be done using a Request for Verification of Rent or Mortgage Account, or information contained on the credit report, or cancelled checks. All lates greater than 30 days must be documented with an explanation from the applicant.
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| o | Applicants with credit scores of 620 or greater are not required to explain recent credit inquiries or to document adverse credit history except for those involving delinquent Federal debt or a previous Agency loan. Additionally, existing collection accounts may remaining outstanding and rental verifications are not required for applicants with credit scores of 620 or greater. |
| o | GMG’s minimum credit score for GRH/Rural Development Program is 580. Credit score eligibility will be determined using the lowest middle score of all borrowers on a single loan file. |
