Federal Register #2026-20022

USDA Rural Housing Service Revises Section 538 Rural Rental Housing Guarantee Fees

The U.S. Department of Agriculture’s Rural Housing Service is revising guarantee fees for its Section 538 rural rental housing program. - Buyer: U.S. Department of Agriculture (USDA), Rural Housing Service (RHS); the notice concerns the Section 538 Guaranteed Rural Rental Housing Program. - Opportunity type: Program policy notice, not a procurement solicitation or award. No vendors, OEMs, products, or services are identified or requested. - Revised guarantee fees: - Standard fee structure: 65 basis points initially and 35 basis points annually. - Workforce housing with rents between 80% and 115% of area median income: 60 basis points initially and 25 basis points annually. - Preservation of existing Section 515 and Section 514/516 Rural Development properties: 60 basis points initially and 25 basis points annually. - New construction or substantial rehabilitation in Qualified Opportunity Zones: 60 basis points initially and 25 basis points annually. - Notable requirement: Lenders must certify that properties receiving the Qualified Opportunity Zone fee treatment are in a designated zone. - Transition guidance: The notice explains how the revised fees apply to previously approved, obligated, or submitted applications.

Description

The Rural Housing Service (RHS), an agency of the U.S. Department of Agriculture, announces revised initial and annual guarantee fees for the Section 538 Guaranteed Rural Rental Housing Program. The revision replaces the fee category for new construction or substantial rehabilitation with green features with a category for properties located in Qualified Opportunity Zones. For properties in Qualified Opportunity Zones, the initial guarantee fee is 60 basis points and the annual fee is 25 basis points. The notice also explains how applications already approved, obligated, or submitted before the new category takes effect are treated.

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