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ATTACHMENT 9-C EXAMPLE CASE STUDY
Household members:
Name Relationship Comments Household Income, Assets, and Expenses
Employed, party to note $1,250/week wages;
David Example
Applicant
Savings account balance $41,400 (APY .5) Checking account balance $3,500
Age: 40
Betsy Example Applicant
Employed, party to note $15.50/hr. wages – working 20 hours week
Age: 40
$100/month child support from ex-husband (Kathy’s father)
David’s mother
$800/month Social Security benefits Savings account balance $3,800 (APY .045)
Cynthia Example
Disabled, moved in when husband died, not a party to the note
Age: 67
Checking account balance $1,400
Janet Smith Daughter
$600/month wages
Full-time college student, part- time employed, not a party to the note
Age: 19
Kathy Smith Daughter
$9.00/hour x 8 hours per week x 4 weeks = $288 monthly earnings
Full-time junior-high school student, part-time employed, not a party to the note
Age: 14
Chris Doe Foster child
Full-time elementary student, not a party to the note
County pays household $800/month to care for foster child. The family pays $50 per week/$200 per month for after school child care.
Age: 8
Eligible Household Income: Calculate annual and adjusted annual income to determine eligibility of the household for the SFHGLP. For Annual Income Calculation – Consider income of all household members:
x Count David’s wages Count Betsy’s wages Count child support (Betsy)
x Count only the first $480 of Janet’s wages (Household member is greater than 18 years of age but is a full- time student)
x Do not count Kathy’s wages (Household member is a minor and less than 18 years of age)
x Do not count payments for Care of foster child
x Count Cynthia’s Social Security
x Count actual income from assets from all members of the household if they total $50,000 or more.
x Passbook rate is .03
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Adjusted Annual Income Calculation:
Dependent Deduction
x Three dependent deductions are permitted for Kathy (a minor), Janet (an adult full-time student, who is not the head of household or spouse), and Cynthia (an adult individual with disabilities, who is not the head of household or spouse).
x A foster child is not a permanent household member, and therefore is not an eligible dependent.
x Total household members that meet the Household member definition in 7 CFR 3555.10 are David, Betsey, Cynthia, Janet, and Kathy.
x A deduction of $1,440 in this example may be deducted ($480 for each eligible dependent x 3 = $1,440). Dependents are Kathy, Janet, and Cynthia.
Child Care Deduction
x Child care expenses are permitted for the care of a foster child but must not exceed the amount earned by the family member enabled to work.
x Child care expenses are not permitted if another adult household member is available to care for the child. In this example, it is assumed there are no adult household members available to care for the child.
x Since the cost of child care does not exceed an adult household member’s monthly earnings, the full amount of the child care may be deducted.
Elderly or Disabled Household Deduction
x Cynthia, a household member, is 67. But she is not an applicant on the loan, therefore no elderly family deduction is allowed.
Medical Expense Deduction
x Family medical expenses cannot be deducted since this is not an elderly or disabled household as defined in 7 CFR 3555.152(c).
Disability Assistance Expenses
x No disability assistance expenses were claimed. To be allowed a deduction, the expenses would have to be necessary to enable a family member to work.
Repayment Income: Calculate the income utilized to repay the loan. Consider only income from parties to the note that is determined to be stable and dependable per 7 CFR 3555.152(a).
David and Betsy are parties to the note. David has worked the last two years earning $1,250 per week or $65,000 annually. Betsy has made $15.50/hour and worked 20 hours per week for the past five years consistently. Betsy receives child support for Kathy, paid through the court at $100 a month, or $1,200 annually. She has received support consistently for the past three years. Kathy is 14.
David and Betsy have cared for foster children for the past three years. Chris Doe is 8 years of age. The county pays $800.00 per month, or $9,600 annually to the household to care for the foster child. Foster care is not a source of income that is eligible for repayment income.
x David: $65,000 historical employment income divided by 12 = $5,416.67
x Betsy: $16,120 historical employment income divided by 12 = $1,343.33
x Betsy: $1,200 historical child support income divided by 12 = $100.00 [3-year continuance since Kathy is 14]
x Total stable and dependable income in accordance with 7 CFR 3555.152(a) = $6,860.00/month
Current
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ATTACHMENT 9-C EXAMPLE CASE STUDY:
Applicant: David Example Co Applicant: Betsy Example
WORKSHEET FOR DOCUMENTING ELIGIBLE HOUSEHOLD AND REPAYMENT INCOME
Lender Instructions: Determine eligible household income for the Single-Family Housing Guaranteed Loan Program (SFHGLP) by documenting all sources/types of income for all household members. Qualify the loan by documenting all sources/type of income that is stable and dependable utilized to repay the loan.
Identify all Household Members Age Full-time Student Y/N?
Disabled
Receive Income Y/N?
Source of Income
Y/N?
David Example 40 N N Y XYZ Employment Betsy Example 40 N N Y 123 Employment, child support Cynthia Example 67 N Y Y Social Security Janet Smith 19 Y N Y PT Employment Kathy Smith 14 Y N Y PT Employment Chris Doe 8 Y N Y Foster care income ANNUAL INCOME CALCULATION (Consider anticipated income for the next 12 months for all adult household members as described in 7 CFR 3555.152(b) and HB-1-3555 Chapter 9. Website for instructions: https://www.rd.usda.gov/resources/directives)
1. Applicant (Wages, salary, self-employed, commission, overtime, bonus, tips, alimony, child support, pension/retirement, social security, disability, trust income, etc.) Calculate and record how the calculation of each income source/type was determined in the space below.
David - $1,250/wk. x 52 = $65,000 $65,000.00
2. Co-Applicant (Wages, salary, self-employed, commission, overtime, bonus, tips, alimony, child support, pension/retirement, social security, disability, trust income, etc.) Calculate and record how the calculation of each income source/type was determined in the space below.
Betsy - $15.50/hr. x 20 hrs./wk. x 52 = $16,120 Betsy – child support - $100 x 12 = $1,200
$17,320.00
3. Additional Income to Primary Income (Automobile Allowance, Mortgage Differential, Military, Secondary Employment, Seasonal Employment, Unemployment, etc.) Calculate and record how the calculation of each income source/type was determined in the space below. $0
4. Additional Adult Household Member (s) who are not a party to the note (Primary Employment from Wages, Salary, Self- Employed, Additional income to Primary Employment, Other Income). Calculate and record how the calculation of each income source/type was determined in the space below.
$10,080.00
Cynthia- $800/month x 12 = $9,600 Janet = first $480 must be counted as full-time student over 18 years of age
5. Income from Assets (Income from household assets, if total exceeds $50,000, as described in HB-1-3555, Chapter 9). Calculate and record how the calculation of each income source/type was determined in the space below. Total assets=$50,100 David: Savings $41400x.005=$207, Checking: 3500x.003(passbook rate)=$10.50 Cynthia: Savings $3800x.0045=$17.10, Checking: $1400x.003=$4.20
$238.80
6. Annual Household Income (Total 1 through 5) $92,638
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Applicant: David Example Co Applicant: Betsy Example
ADJUSTED ANNUAL INCOME CALCULATION (Consider qualifying deductions as described in 7 CFR 3555.152(c) and HB-1-3555 Chapter 9)
7. Dependent Deduction ($480 for each child under age 18, full-time student, or disabled family member over the age of 18) - # 3 x $480 $1,440.00
8. Annual Child Care Expenses (Reasonable expenses for children 12 and under) Calculate and record the calculation of the deduction in the space below.
$2,600.00
$50/week x 52 weeks/year = $2,600
9. Elderly/Disabled Household (1 household deduction of $400 if 62 years of age or older, or disabled and a party to the note) $0
10. Disability (Unreimbursed expenses in excess of 3% of annual income per 7 CFR 3555.152(c) and HB-1-3555 Chapter 9) Calculate and record the calculation of the deduction in the space below.
$0
11. Medical Expenses (Elderly/Disabled households only. Unreimbursed medical expenses in excess of 3% of annual income per 7 CFR 3555.152(c) and HB-1-3555 Chapter 9.) Calculate and record the calculation of the deduction in the space below. $0
$4,040.00
12. Total Household Deductions (Total 7 through 11)
Applicant: David Example Co Applicant: Betsy Example
13. Adjusted Annual Income (Item 6 minus item 12)
Income cannot exceed Moderate Income Limit to be eligible for SFHGLP
$88,598.80 County: Washington Oklahoma State: Moderate Income Limit: $121,300
(03-09-16) SPECIAL PN 9-52 Revised (08-05-25) PN 649
Guidance documents lack the force and effect of law, unless expressly authorized by statute or incorporated into a contract. USDA may not cite, use, or rely on any guidance that is not available through their guidance portal, except to establish historical facts.
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MONTHLY REPAYMENT INCOME CALCULATION (Consider stable and dependable income of parties to the note as described in 7 CFR 3555.152(a) and HB‐1‐3555 Chapter 9. Non-occupant borrowers or co-signers are not allowed.)
14. Stable Dependable Monthly Income (Parties to note only). Calculate and record how the calculation of each income source/type was determined in the space below. Identify income type by party to note.
Applicant Co-Applicant Total
Base Income
$6,760.00
$5,416.67
$1,343.33
Calculation of Base Income:
Calculation of Base Income:
Betsy: $16,120 /12 = $1,343.33
David: $65,000 / 12 = $5,416.67
Other Income
$100.00
$100.00
Calculation of Other Income:
Calculation of Other Income:
Betsy: Child Support: $1,200 / 12 = $100.00
[3 year continuance confirmed: Kathy is 14]
Total Income
$5,416.67 $1,443.33 $6,860.00
15. Monthly Repayment Income (Total of 14) $6,860.00
Preparer’s Signature: [Signature]
Name (Print): [Name]
Title: [Title]
Date: [Date]