Page 12
1.5 SFHGLP SUMMARY
Private lenders are key to the success of the SFHGLP. Although the Agency issues loan guarantees, lenders that have been approved to participate in the program are responsible for originating, underwriting, servicing, and liquidating loans. The lender is ultimately responsible for ensuring that all program requirements are met, and that the underwriting procedures for the loan are followed. The Agency reviews each loan proposal to ensure the applicant and property appear to meet program eligibility requirements and monitors lender performance on an ongoing basis to help ensure that lenders accurately understand the Agency’s expectations.
Applicant eligibility is discussed in detail in chapters 8 through 11. In summary, applicants may be eligible to receive a guaranteed loan if they:
x Are income-eligible;
x Agree to personally occupy the dwelling as their primary residence;
x Have acceptable citizenship or immigration status, as defined in Chapter 8;
x Have the legal capacity to incur the loan obligation;
x Have not been suspended or debarred from participation in Federal programs;
x Have demonstrated both the willingness and the ability to repay the loan; and
x Are purchasing a property that meets all program criteria.
In the event that a lender incurs a loss on a guaranteed loan, the Agency will compensate the lender under the terms of the Loan Note Guarantee and all program requirements.
SECTION 3: GENERAL PROGRAM REQUIREMENTS