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15.7 LENDER RESPONSE TO CONDITIONAL COMMITMENT
The lender has three responses to the issuance of Form RD 3555-18/18E: the lender may accept the terms and conditions, decline the terms and conditions for loan guarantee, or request that the terms and conditions be altered.
A. Accepting the Conditions
If the lender understands and agrees to accept the conditions listed on Form RD 3555- 18/18E, no further communication with the Agency is required until the lender is ready to request the loan guarantee. The loan must close in accordance with Form RD 3555- 18/18E which includes:
1. A loan amount equal to or less than the authorized amount,
2. An interest rate equal to or less than the authorized amount, and
3. Compliance with all stated conditions.
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B. Declining the Conditions for Loan Guarantee
If the lender determines that the terms and conditions stated on Form RD 3555- 18/18E cannot be met, that the loan guarantee is not needed, or that the loan will not go to closing, the lender must inform the Agency in writing as soon as possible. The funds for that loan request are reserved for the transaction until the expiration of the Conditional Commitment. Upon being informed that the lender intends to decline the conditions for loan guarantee, Agency staff will cancel the loan guarantee obligation in GLS. This will release the committed funds for reallocation to a new commitment.
C. Requesting Changes in Conditions
Requests to close the loan at a lower loan amount or interest rate than those authorized on the issued Conditional Commitment do not require any action. If the lender believes that there are erroneous conditions and requirements on Form RD 3555- 18/18E that should be altered, the lender may contact the Agency and propose alternatives. The request must be made via email and must not affect the eligibility of the loan.
Modifications that adversely affect the loan, such as an increase in loan amount, interest rate, monthly liabilities, real estate taxes and homeowner’s insurance (that exceed the allowed threshold); or lower repayment income, assets, etc. require a new underwriting review. Refer to the resubmission policy outlined in Chapter 5 of this Handbook. The lender is not authorized to close the loan until a new Form RD 3555- 18/18E is issued.
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HB 1-3555 Attachment 15-A