The United States Department of Agriculture – Rural Housing (“USDA”) allows for borrowers to finance the cost of repairs to improve an existing dwelling at the time of purchase. The USDA Rehabilitation and Repair Loan allows borrowers to finance the cost of acquisition, the cost of repairs and the guarantee fee, if financed, in one fixed rate loan up to a maximum loan amount of the “as repaired” appraised value.
The USDA Rehabilitation and Repair Loan is not allowed for investment properties, or for converting structures to a single-family dwelling. Also, repairs to new or existing manufactured homes and condos are prohibited.
DocMagic will offer a new generic USDA Rehabilitation and Repair loan program and has created new forms to support this loan type that will included in all closing packages.
The new forms include:
- USDA Rehabilitation and Repair Borrower’s Acknowledgment (Form ID: RRBA.RH)
- Borrower Identity-of- Interest Certification – USDA (Form ID: BIIC.RH)
- Rehabilitation Loan Agreement – USDA (RLA.RH)
- Rehabilitation Loan Rider – USDA (Form ID: RLR.RH)
The new USDA Rehabilitation and Repair loan program and related forms will be available beginning on March 09, 2023.
