SS Memo 06-03


Date: March31, 2006

Changes to Income Limits


  • Income limits for the following AHFC loan programs and program options have been revised based on the release of HUD’s FY 2006 income limits. These changes are effective immediately.
  • Tax-Exempt Program Non-Targeted Areas
  • Tax-Exempt Program Targeted Areas
  • Interest Rate Reduction for Low-Income Borrowers (IRRLIB)
  • Affordable Homeownership Guaranteed Loan Program (AHGLP)
  • Home Ownership Fund (HOF)
  • Rural Enhanced Loan Program (RELP)

Form PRG-46 or PRG-46T (for targeted areas) dated 03/08/06 is required for all loans committed on or after March 08, 2006. Lenders are reminded that the PRG- 46T is only for use on loans made in Targeted Areas.

Interest Rate Lock-in Request (UND-2)


Beginning April 07, 2006, lock-in requests will be administered in AHFC underwriting. The UND-2 should be faxed to AHFC Underwriting at (907) 330- 8475 and questions about lock-ins should be directed to an AHFC underwriter. As a result of this change, AHFC is amending the UND-2 to reflect the new fax number. Lenders should begin using the revised form April 07, 2006.

Tax-Exempt Program - Three-Year Physical Address History

AHFC has noticed an increase in the number of Tax-Exempt loan submissions and audit files that lack the required three-year physical address history. Section 5002.06.B states “The loan application and supporting documentation should demonstrate a three-year physical address history; a post office box is insufficient.” Effective immediately, Tax-Exempt loan submission files that do not meet these requirements will be returned to the lender as incomplete.

Conventional Loans - Payment of Settlement Costs

On conventional loans, borrowers must pay prepaid expenses from their own cash assets or a gift. Section 1004.05 of the Selling Guide makes an exception only for government insured or guaranteed loans. During recent audits, AHFC found that in several instances the HUD-1 Settlement Statement indicated the seller paid all or part of a borrower’s prepaid expenses. Effective with loans closed on or after April 07, 2006, if the audit file of a conventional loan discloses that prepaid expenses were paid by the seller, the lender will be required to provide a corrected HUD-1 acknowledged by buyer and seller.

Energy Rating Certificate and the PUR-101

On newly constructed homes, the energy rating on the rating certificate and the PUR-101 must be the same. AHFC uses the energy rating certificate to determine a property’s eligibility for an interest rate reduction under the EEIRR. If there is a discrepancy between the energy rating certificate and the PUR-101, the lender should determine which is correct and obtain updated documentation.


Replacement forms are available in MSWord and PDF. Adobe Acrobat 5 is required to read and print PDF files.

Revised or Deleted Forms

  • PRG-46 Rev 03/06
  • PRG-46T Rev 03/06
  • UND-2 Rev 03/06


Attachments will be incorporated into the online mortgage guides application during the next quarterly update. Attachments are available in PDF.

  • FY 2006 Income Limits
  • Tax-Exempt Income Limits - Non-Targeted Areas
  • Tax-Exempt Income Limits - Targeted Areas
  • Interest Rate Reduction for Low-Income Borrowers
  • Affordable Homeownership Guaranteed Loan Program
  • Home Ownership Fund
  • Rural Enhanced Loan Program