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HUD/OH RIN: 2502-AJ50 Publication ID: Fall 2023 
Title: Mortgage Insurance for Mortgage Transactions Involving Downpayment Assistance Programs (FR-6150) 

The Housing and Economic Recovery Act of 2008 (HERA) amended the National Housing Act to add a prohibited sources clause, under section 203(b)(9)(C).  This requirement prohibits any portion of a borrower’s the minimum cash investment, as required by section 203(b)(9)(A) from being provided by: (i) the seller or any other person or entity that financially benefits from the transaction, or (ii) any third party or entity that is reimbursed, directly or indirectly, by any of the parties described in clause (i). While section 203(b)(9) prohibits assistance from a seller involved in the transaction, FHA continues to receive questions regarding the prohibition on persons or entities that may financially benefit from the transaction. In particular, FHA has received questions regarding whether down payment assistance programs operated by government entities are being operated in a fashion that would render such assistance prohibited. This rule would establish through rulemaking the circumstances in which governmental entities are deriving a prohibited financial benefit.

Agency: Department of Housing and Urban Development(HUD)  Priority: Other Significant 
RIN Status: Previously published in the Unified Agenda Agenda Stage of Rulemaking: Proposed Rule Stage 
Major: No  Unfunded Mandates: No 
CFR Citation: 24 CFR 203   
Legal Authority: 12 U.S.C. 1709    42 U.S.C. 3535(d)   
Legal Deadline:  None
Action Date FR Cite
NPRM  08/00/2024 
Regulatory Flexibility Analysis Required: No  Government Levels Affected: Local, State, Tribal 
Small Entities Affected: No  Federalism: No 
Included in the Regulatory Plan: No 
RIN Data Printed in the FR: No 
Agency Contact:
Mary Jo Sullivan
Acting Director, Office of Single Family Program Development
Department of Housing and Urban Development
Office of Housing
451 7th Street SW,
Washington, DC 20410
Phone:202 402-2186