119-hr4957

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4957 Introduced in House

    (IH) ]

<DOC>

119th CONGRESS
 1st Session
 H. R. 4957

 To reform rural housing programs, and for other purposes.

_______________________________________________________________________

 IN THE HOUSE OF REPRESENTATIVES

 August 12, 2025

Mr. Nunn of Iowa (for himself and Mr. Cleaver) introduced the following 
bill; which was referred to the Committee on Financial Services, and in 
 addition to the Committee on Agriculture, for a period to be 
subsequently determined by the Speaker, in each case for consideration 
 of such provisions as fall within the jurisdiction of the committee 
 concerned

_______________________________________________________________________

 A BILL

 To reform rural housing programs, and for other purposes.

 Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Rural Housing 
Service Reform Act of 2025''.

    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
 TITLE I--STREAMLINING AND UPDATES

Sec. 101. Application of multifamily mortgage foreclosure procedures to 
 multifamily mortgages held by the Secretary 
 of Agriculture and preservation of the 
 rental assistance contract upon 
 foreclosure.

Sec. 102. Study on rural housing loans for housing for low- and 
 moderate-income families.

Sec. 103. Authorization of appropriations for staffing and IT upgrades.

Sec. 104. Funding for technical improvements.
 TITLE II--RURAL HOUSING PRESERVATION AND REVITALIZATION

Sec. 201. Permanent establishment of housing preservation and 
 revitalization program.

Sec. 202. Rental assistance contract authority.
 TITLE III--

SECTION 504 LOANS AND GRANTS

Sec. 301. Modifications to loans and grants for minor improvements to 
 farm housing and buildings; income 
 eligibility.
 TITLE IV--RURAL COMMUNITY DEVELOPMENT INITIATIVE GRANTS

Sec. 401. Rural community development initiative.
 TITLE V--REPORTS

Sec. 501. Annual report on rural housing programs.

Sec. 502. GAO report on Rural Housing Service technology.
 TITLE VI--RURAL HOUSING VOUCHER PROGRAM

Sec. 601. Adjustment to rural development voucher amount.

Sec. 602. Eligibility for rural housing vouchers.

Sec. 603. Amount of voucher assistance.
 TITLE VII--TRANSFERS TO NONPROFIT ORGANIZATIONS

Sec. 701. Transfer of multifamily rural housing projects.
 TITLE VIII--

SECTION 502 LOANS AND GUARANTEES

Sec. 801. Extension of loan term.

Sec. 802. Release of liability for 

section 502 guaranteed borrower upon 
 assumption of original loan by new 
 borrower.

Sec. 803. Department of Agriculture loan restrictions.
 TITLE IX--ACCESSORY DWELLING UNITS

Sec. 901. Loan guarantees.
 TITLE X--TIME FRAME FOR COMPLETING APPLICATION REVIEW

Sec. 1001. Application review.

 TITLE I--STREAMLINING AND UPDATES

SEC. 101. APPLICATION OF MULTIFAMILY MORTGAGE FORECLOSURE PROCEDURES TO 
 MULTIFAMILY MORTGAGES HELD BY THE SECRETARY OF 
 AGRICULTURE AND PRESERVATION OF THE RENTAL ASSISTANCE 
 CONTRACT UPON FORECLOSURE.

    (a) Multifamily Mortgage Procedures.--

Section 363

    (2) of the 
Multifamily Mortgage Foreclosure Act of 1981 (12 U.S.C. 3702

    (2) ) is 
amended--

    (1) in subparagraph
            (D) , by striking ``and'' at the end;

    (2) in subparagraph
        (E) , by striking the period at the end 
 and inserting ``; or''; and

    (3) by adding at the end the following:
 ``
        (F) section 514, 515, or 538 of the Housing Act 
 of 1949 (42 U.S.C. 1484, 1485, 1490p).''.

    (b) Preservation of Contract.--

Section 521
            (d) of the Housing Act of 
1949 (42 U.S.C. 1490a
            (d) ) is amended by adding at the end the 
following:
 ``

    (3) Notwithstanding any other provision of law in managing and 
disposing of any multifamily property that is owned or has a mortgage 
held by the Secretary, and during the process of foreclosure on any 
property with a contract for rental assistance under this section--
 ``
        (A) the Secretary shall maintain any rental assistance 
 payments that are attached to any dwelling units in the 
 property; and
 ``
        (B) the rental assistance contract may be used to provide 
 further assistance to existing projects under 514, 515, or 
 516.''.

SEC. 102. STUDY ON RURAL HOUSING LOANS FOR HOUSING FOR LOW- AND 
 MODERATE-INCOME FAMILIES.

 Not later than 6 months after the date of enactment of this Act, 
the Secretary of Agriculture shall conduct a study and submit to 
Congress a publicly available report on the loan program under 

section 521 of the Housing Act of 1949 (42 U.S.C. 1490a), including--

    (1) the total amount provided by the Secretary in subsidies 
 under such 

section 521 to borrowers with loans made pursuant to 
 

section 502 of such Act (42 U.S.C. 1472);

    (2) how much of the subsidies described in paragraph

    (1) are being recaptured; and

    (3) the amount of time and costs associated with 
 recapturing those subsidies.

SEC. 103. AUTHORIZATION OF APPROPRIATIONS FOR STAFFING AND IT UPGRADES.

 There is authorized to be appropriated to the Secretary of 
Agriculture for each of fiscal years 2026 through 2030 such sums as may 
be necessary for increased staffing needs and information technology 
upgrades to support all Rural Housing Service programs.

SEC. 104. FUNDING FOR TECHNICAL IMPROVEMENTS.

    (a) Authorization of Appropriations.--There is authorized to be 
appropriated to the Secretary of Agriculture such sums as may be 
necessary for fiscal year 2026 for improvements to the technology of 
the Rural Housing Service of the Department of Agriculture used to 
process and manage housing loans.

    (b) Availability.--Amounts appropriated pursuant to subsection

    (a) shall remain available until the date that is 5 years after the date of 
the appropriation.
            (c) Timeline.--The Secretary of Agriculture shall make the 
improvements described in subsection

    (a) during the 5-year period 
beginning on the date on which amounts are appropriated under 
subsection

    (a) .

 TITLE II--RURAL HOUSING PRESERVATION AND REVITALIZATION

SEC. 201. PERMANENT ESTABLISHMENT OF HOUSING PRESERVATION AND 
 REVITALIZATION PROGRAM.

 Title V of the Housing Act of 1949 (42 U.S.C. 1471 et seq.) is 
amended by adding at the end the following:

``

SEC. 545. HOUSING PRESERVATION AND REVITALIZATION PROGRAM.

 ``

    (a) Establishment.--The Secretary shall carry out a program under 
this section for the preservation and revitalization of multifamily 
rental housing projects financed under 

section 514, 515, or 516.
 ``

    (b) Notice of Maturing Loans.--
 ``

    (1) To owners.--On an annual basis, the Secretary shall 
 provide written notice to each owner of a property financed 
 under 

section 514, 515, or 516 that will mature within the 4-
 year period beginning upon the provision of the notice, setting 
 forth the options and financial incentives that are available 
 to facilitate the extension of the loan term or the option to 
 decouple a rental assistance contract pursuant to subsection

    (f) .
 ``

    (2) To tenants.--
 ``
        (A) In general.--On an annual basis, for each 
 property financed under 

section 514, 515, or 516, not 
 later than the date that is 2 years before the date 
 that the loan will mature, the Secretary shall provide 
 written notice to each household residing in the 
 property that informs them of--
 ``
            (i) the date of the loan maturity;
 ``
            (ii) the possible actions that may happen 
 with respect to the property upon that 
 maturity; and
 ``
            (iii) how to protect their right to 
 reside in federally assisted housing, or how to 
 secure housing voucher, after that maturity.
 ``
        (B) Language.--Notice under this paragraph shall 
 be provided in plain English and shall be translated to 
 other languages in the case of any property located in 
 an area in which a significant number of residents 
 speak such other languages.
 ``
            (c) Loan Restructuring.--Under the program under this section, in 
any circumstance in which the Secretary proposes a restructuring to an 
owner or an owner proposes a restructuring to the Secretary, the 
Secretary may restructure such existing housing loans, as the Secretary 
considers appropriate, for the purpose of ensuring that those projects 
have sufficient resources to preserve the projects to provide safe and 
affordable housing for low-income residents and farm laborers, by--
 ``

    (1) reducing or eliminating interest;
 ``

    (2) deferring loan payments;
 ``

    (3) subordinating, reducing, or reamortizing loan debt;
 ``

    (4) providing other financial assistance, including 
 advances, payments, and incentives (including the ability of 
 owners to obtain reasonable returns on investment) required by 
 the Secretary; and
 ``

    (5) permanently removing a portion of the housing units 
 from income restrictions when sustained vacancies have 
 occurred.
 ``
            (d) Renewal of Rental Assistance.--
 ``

    (1) In general.--When the Secretary proposes to 
 restructure a loan or agrees to the proposal of an owner to 
 restructure a loan pursuant to subsection
            (c) , the Secretary 
 shall offer to renew the rental assistance contract under 
 

section 521

    (a)

    (2) for a term that is the shorter of 20 years 
 and the term of the restructured loan, subject to annual 
 appropriations, provided that the owner agrees to bring the 
 property up to such standards that will ensure maintenance of 
 the property as decent, safe, and sanitary housing for the full 
 term of the rental assistance contract.
 ``

    (2) Additional rental assistance.--With respect to a 
 project described in paragraph

    (1) , if rental assistance is not 
 available for all households in the project for which the loan 
 is being restructured pursuant to subsection
            (c) , the Secretary 
 may extend such additional rental assistance to unassisted 
 households at that project as is necessary to make the project 
 safe and affordable to low-income households.
 ``

    (e) Restrictive Use Agreements.--
 ``

    (1) Requirement.--As part of the preservation and 
 revitalization agreement for a project, the Secretary shall 
 obtain a restrictive use agreement that is recorded and 
 obligates the owner to operate the project in accordance with 
 this title.
 ``

    (2) Term.--
 ``
        (A) No extension of rental assistance contract.--
 Except when the Secretary enters into a 20-year 
 extension of the rental assistance contract for a 
 project, the term of the restrictive use agreement for 
 the project shall be consistent with the term of the 
 restructured loan for the project.
 ``
        (B) Extension of rental assistance contract.--If 
 the Secretary enters into a 20-year extension of the 
 rental assistance contract for a project, the term of 
 the restrictive use agreement for the project shall be 
 for the longer of--
 ``
            (i) 20 years; or
 ``
            (ii) the remaining term of the loan for 
 that project.
 ``
            (C) Termination.--The Secretary may terminate the 
 20-year use restrictive use agreement for a project 
 before the end of the term of the agreement if the 20-
 year rental assistance contract for the project with 
 the owner is terminated at any time for reasons outside 
 the control of the owner.
 ``

    (f) Decoupling of Rental Assistance.--
 ``

    (1) Renewal of rental assistance contract.--If the 
 Secretary determines that a loan maturing during the 4-year 
 period beginning upon the provision of the notice required 
 under subsection

    (b)

    (1) for a project cannot reasonably be 
 restructured in accordance with subsection
            (c) because it is 
 not financially feasible or the owner does not agree with the 
 proposed restructuring, and the project was operating with 
 rental assistance under 

section 521 and the recipient is a 
 borrower under 

section 514 or 515, the Secretary may renew the 
 rental assistance contract, notwithstanding any requirement 
 under 

section 521 that the recipient be a current borrower 
 under 

section 514 or 515, for a term of 20 years, subject to 
 annual appropriations.
 ``

    (2) Additional rental assistance.--With respect to a 
 project described in paragraph

    (1) , if rental assistance is not 
 available for all households in the project for which the loan 
 is being restructured pursuant to subsection
            (c) , the Secretary 
 may extend such additional rental assistance to unassisted 
 households at that project as is necessary to make the project 
 safe and affordable to low-income households.
 ``

    (3) Rents.--
 ``
        (A) In general.--Any agreement to extend the term 
 of the rental assistance contract under 

section 521 for 
 a project shall obligate the owner to continue to 
 maintain the project as decent, safe, and sanitary 
 housing and to operate the development as affordable 
 housing in a manner that meets the goals of this title.
 ``
        (B) Rent amounts.--Subject to subparagraph
            (C) , 
 in setting rents, the Secretary--
 ``
            (i) shall determine the maximum initial 
 rent based on current fair market rents 
 established under 

section 8 of the United 
 States Housing Act of 1937 (42 U.S.C. 1437f); 
 and
 ``
            (ii) may annually adjust the rent 
 determined under clause
            (i) by the operating 
 cost adjustment factor as provided under 
 

section 524 of the Multifamily Assisted Housing 
 Reform and Affordability Act of 1997 (42 U.S.C. 
 1437f note).
 ``
            (C) Higher rent.--
 ``
            (i) In general.--Subparagraph
        (B) shall 
 not apply if the Secretary determines that the 
 budget-based needs of a project require a 
 higher rent than the rent described in 
 subparagraph
        (B) .
 ``
            (ii) Rent.--If the Secretary makes a 
 positive determination under clause
            (i) , the 
 Secretary may approve a budget-based rent level 
 for the project.
 ``

    (4) Conditions for approval.--Before the approval of a 
 rental assistance contract authorized under this section, the 
 Secretary shall require, through an annual notice in the 
 Federal Register, the owner to submit to the Secretary a plan 
 that identifies financing sources and a timetable for 
 renovations and improvements determined to be necessary by the 
 Secretary to maintain and preserve the project.
 ``

    (g) Multifamily Housing Transfer Technical Assistance.--Under the 
program under this section, the Secretary may provide grants to 
qualified nonprofit organizations and public housing agencies to 
provide technical assistance, including financial and legal services, 
to borrowers under loans under this title for multifamily housing to 
facilitate the acquisition or preservation of such multifamily housing 
properties in areas where the Secretary determines there is a risk of 
loss of affordable housing.
 ``

    (h) Administrative Expenses.--Of any amounts made available for 
the program under this section for any fiscal year, the Secretary may 
use not more than $1,000,000 for administrative expenses for carrying 
out such program.
 ``
            (i) Authorization of Appropriations.--There is authorized to be 
appropriated for the program under this section such sums as may be 
necessary for each of fiscal years 2026 through 2030.
 ``

    (j) Rulemaking.--
 ``

    (1) In general.--Not later than 180 days after the date 
 of enactment of the Rural Housing Service Reform Act of 2025, 
 the Secretary shall--
 ``
        (A) publish an advance notice of proposed 
 rulemaking; and
 ``
        (B) consult with appropriate stakeholders.
 ``

    (2) Interim final rule.--Not later than 1 year after the 
 date of enactment of the Rural Housing Service Reform Act of 
 2025, the Secretary shall publish an interim final rule to 
 carry out this section.''.

SEC. 202. RENTAL ASSISTANCE CONTRACT AUTHORITY.

 

Section 521
            (d) of the Housing Act of 1949 (42 U.S.C. 1490a
            (d) ), as 
amended by 

section 101

    (b) , is amended--

    (1) in paragraph

    (1) --
        (A) by redesignating subparagraphs
        (B) and
            (C) as 
 subparagraphs
            (C) and
            (D) , respectively;
        (B) by inserting after subparagraph
        (A) the 
 following:
 ``
        (B) upon request of an owner of a project financed under 
 

section 514 or 515, the Secretary is authorized to enter into 
 renewal of such agreements for a period of 20 years or the term 
 of the loan, whichever is shorter, subject to amounts made 
 available in appropriations Acts;'';
            (C) in subparagraph
            (C) , as so redesignated, by 
 striking ``subparagraph
        (A) '' and inserting 
 ``subparagraphs
        (A) and
        (B) ''; and
            (D) in subparagraph
            (D) , as so redesignated, by 
 striking ``subparagraphs
        (A) and
        (B) '' and inserting 
 ``subparagraphs
        (A) ,
        (B) , and
            (C) '';

    (2) in paragraph

    (2) , by striking ``shall'' and inserting 
 ``may''; and

    (3) by adding at the end the following:
 ``

    (4) In the case of any rental assistance contract authority that 
becomes available because of the termination of assistance on behalf of 
an assisted family--
 ``
        (A) at the option of the owner of the rental project, the 
 Secretary shall provide the owner a period of not more than 6 
 months before unused assistance is made available pursuant to 
 subparagraph
        (B) during which the owner may use such assistance 
 authority to provide assistance on behalf of an eligible 
 unassisted family that--
 ``
            (i) is residing in the same rental project in 
 which the assisted family resided before the 
 termination; or
 ``
            (ii) newly occupies a dwelling unit in the rental 
 project during that 6-month period; and
 ``
        (B) except for assistance used as provided in 
 subparagraph
        (A) , the Secretary shall use such remaining 
 authority to provide assistance on behalf of eligible families 
 residing in other rental projects originally financed under 
 

section 514, 515, or 516.''.

 TITLE III--

SECTION 504 LOANS AND GRANTS

SEC. 301. MODIFICATIONS TO LOANS AND GRANTS FOR MINOR IMPROVEMENTS TO 
 FARM HOUSING AND BUILDINGS; INCOME ELIGIBILITY.

 

Section 504

    (a) of the Housing Act of 1949 (42 U.S.C. 1474

    (a) ) is 
amended--

    (1) in the first sentence, by inserting ``and may make a 
 loan to an eligible low-income applicant'' after ``applicant'';

    (2) by inserting ``Not less than 60 percent of loan funds 
 made available under this section shall be reserved and made 
 available for very low-income applicants.'' after the first 
 sentence; and

    (3) by striking ``$7,500'' and inserting ``$15,000''.

 TITLE IV--RURAL COMMUNITY DEVELOPMENT INITIATIVE GRANTS

SEC. 401. RURAL COMMUNITY DEVELOPMENT INITIATIVE.

 Subtitle E of the Consolidated Farm and Rural Development Act (7 
U.S.C. 2009 et seq.) is amended by adding at the end the following:

``

SEC. 381O. RURAL COMMUNITY DEVELOPMENT INITIATIVE.

 ``

    (a) 

=== Definitions. ===
-In this section:
 ``

    (1) Eligible entity.--The term `eligible entity' means--
 ``
        (A) a private, nonprofit community-based housing 
 or community development organization;
 ``
        (B) a rural community; or
 ``
            (C) a federally recognized Indian Tribe.
 ``

    (2) Eligible intermediary.--The term `eligible 
 intermediary' means a qualified--
 ``
        (A) private, nonprofit organization; or
 ``
        (B) public organization.
 ``

    (b) Establishment.--The Secretary shall establish a Rural 
Community Development Initiative, under which the Secretary shall 
provide grants to eligible intermediaries to carry out programs to 
provide financial and technical assistance to eligible entities to 
develop the capacity and ability of eligible entities to carry out 
projects to improve housing, community facilities, and community and 
economic development projects in rural areas.
 ``
            (c) Amount of Grants.--The amount of a grant provided to an 
eligible intermediary under this section shall be not more than 
$250,000.
 ``
            (d) Matching Funds.--
 ``

    (1) In general.--An eligible intermediary receiving a 
 grant under this section shall provide matching funds from 
 other sources, including Federal funds for related activities, 
 in an amount not less than the amount of the grant.
 ``

    (2) Waiver.--The Secretary may waive paragraph

    (1) with 
 respect to a project that would be carried out in a 
 persistently poor rural region, as determined by the 
 Secretary.''.

 TITLE V--REPORTS

SEC. 501. ANNUAL REPORT ON RURAL HOUSING PROGRAMS.

 Title V of the Housing Act of 1949 (42 U.S.C. 1471 et seq.), as 
amended by this Act, is amended by adding at the end the following:

``

SEC. 546. ANNUAL REPORT.

 ``

    (a) In General.--The Secretary shall submit to the appropriate 
committees of Congress and publish on the website of the Department of 
Agriculture an annual report on rural housing programs carried out 
under this title, which shall include significant details on the health 
of Rural Housing Service programs, including--
 ``

    (1) raw data sortable by programs and by region regarding 
 loan performance;
 ``

    (2) the housing stock of those programs, including 
 information on why properties end participation in those 
 programs, such as for maturation, prepayment, foreclosure, or 
 other servicing issues; and
 ``

    (3) risk ratings for properties assisted under those 
 programs.
 ``

    (b) Protection of Information.--The data included in each report 
required under subsection

    (a) may be aggregated or anonymized to 
protect participant financial or personal information.''.

SEC. 502. GAO REPORT ON RURAL HOUSING SERVICE TECHNOLOGY.

 Not later than 1 year after the date of enactment of this Act, the 
Comptroller General of the United States shall submit to Congress a 
report that includes--

    (1) an analysis of how the outdated technology used by the 
 Rural Housing Service impacts participants in the programs of 
 the Rural Housing Service;

    (2) an estimate of the amount of funding that is needed to 
 modernize the technology used by the Rural Housing Service; and

    (3) an estimate of the number and type of new employees the 
 Rural Housing Service needs to modernize the technology used by 
 the Rural Housing Service.

 TITLE VI--RURAL HOUSING VOUCHER PROGRAM

SEC. 601. ADJUSTMENT TO RURAL DEVELOPMENT VOUCHER AMOUNT.

    (a) In General.--Not later than 2 years after the date of enactment 
of this Act, the Secretary of Agriculture shall issue regulations to 
establish a process for adjusting the voucher amount provided under 

section 542 of the Housing Act of 1949 (42 U.S.C. 1490r) after the 
issuance of the voucher following an interim or annual review of the 
amount of the voucher.

    (b) Interim Review.--The interim review described in subsection

    (a) shall, at the request of a tenant, allow for a recalculation of the 
voucher amount when the tenant experiences a reduction in income, 
change in family composition, or change in rental rate.
            (c) Annual Review.--

    (1) In general.--The annual review described in subsection

    (a) shall require tenants to annually recertify the family 
 composition of the household and that the family income of the 
 household does not exceed 80 percent of the area median income 
 at a time determined by the Secretary of Agriculture.

    (2) Considerations.--If a tenant does not recertify the 
 family composition and family income of the household within 
 the time frame required under paragraph

    (1) , the Secretary of 
 Agriculture--
        (A) shall consider whether extenuating 
 circumstances caused the delay in recertification; and
        (B) may alter associated consequences for the 
 failure to recertify based on those circumstances.

    (3) Effective date.--Following the annual review of a 
 voucher under subsection

    (a) , the updated voucher amount shall 
 be effective on the 1st day of the month following the 
 expiration of the voucher.
            (d) Deadline.--The process established under subsection

    (a) shall 
require the Secretary of Agriculture to review and update the voucher 
amount described in subsection

    (a) for a tenant not later than 60 days 
before the end of the voucher term.

SEC. 602. ELIGIBILITY FOR RURAL HOUSING VOUCHERS.

 

Section 542 of the Housing Act of 1949 (42 U.S.C. 1490r) is amended 
by adding at the end the following:
 ``
            (c) Eligibility of Households in Sections 514, 515, and 516 
Projects.--The Secretary may provide rural housing vouchers under this 
section for any low-income household (including those not receiving 
rental assistance) residing for a term longer than the remaining term 
of their lease that is in effect on the date of prepayment, 
foreclosure, or mortgage maturity, in a property financed with a loan 
under 

section 514 or 515 or a grant under 

section 516 that has--
 ``

    (1) been prepaid with or without restrictions imposed by 
 the Secretary pursuant to 

section 502
            (c) (5)
        (G)
            (ii) 
            (I) ;
 ``

    (2) been foreclosed; or
 ``

    (3) matured after September 30, 2005.''.

SEC. 603. AMOUNT OF VOUCHER ASSISTANCE.

 Notwithstanding any other provision of law, in the case of any 
rural housing voucher provided pursuant to 

section 542 of the Housing 
Act of 1949 (42 U.S.C. 1490r), the amount of the monthly assistance 
payment for the household on whose behalf the assistance is provided 
shall be determined as provided in subsection

    (a) of such 

section 542, 
including providing for interim and annual review of the voucher amount 
in the event of a change in household composition or income or rental 
rate.

 TITLE VII--TRANSFERS TO NONPROFIT ORGANIZATIONS

SEC. 701. TRANSFER OF MULTIFAMILY RURAL HOUSING PROJECTS.

 

Section 515 of the Housing Act of 1949 (42 U.S.C. 1485) is 
amended--

    (1) in subsection

    (h) , by adding at the end the following:
 ``

    (3) Transfer to nonprofit organizations.--A nonprofit or 
 public body purchaser, including a limited partnership with a 
 general partner with the principal purpose of providing 
 affordable housing, may purchase a property for which a loan is 
 made or insured under this section that has received a market 
 value appraisal, without addressing rehabilitation needs at the 
 time of purchase, if the purchaser--
 ``
        (A) makes a commitment to address rehabilitation 
 needs during ownership and long-term use restrictions 
 on the property; and
 ``
        (B) at the time of purchase, accepts long-term 
 use restrictions on the property.''; and

    (2) in subsection

    (w)

    (1) , in the first sentence in the 
 matter preceding subparagraph
        (A) , by striking ``9 percent'' 
 and inserting ``25 percent''.

 TITLE VIII--

SECTION 502 LOANS AND GUARANTEES

SEC. 801. EXTENSION OF LOAN TERM.

    (a) In General.--

Section 502

    (a)

    (2) of the Housing Act of 1949 (42 
U.S.C. 1472

    (a)

    (2) ) is amended--

    (1) by inserting ``
        (A) '' before ``The Secretary'';

    (2) in subparagraph
        (A) , as so designated, by striking 
 ``paragraph'' and inserting ``subparagraph''; and

    (3) by adding at the end the following:
 ``
        (B) The Secretary may refinance or modify the period of 
 any loan, including any refinanced loan, made under this 
 section in accordance with terms and conditions as the 
 Secretary shall prescribe, but in no event shall the total term 
 of the loan from the date of the refinance or modification 
 exceed 40 years.''.

    (b) Application.--The amendment made under subsection

    (a) shall 
apply with respect to loans made under 

section 502 of the Housing Act 
of 1949 (42 U.S.C. 1472) before, on, or after the date of enactment of 
this Act.

SEC. 802. RELEASE OF LIABILITY FOR 

SECTION 502 GUARANTEED BORROWER UPON 
 ASSUMPTION OF ORIGINAL LOAN BY NEW BORROWER.

 

Section 502

    (h)

    (10) of the Housing Act of 1949 (42 U.S.C. 
1472

    (h)

    (10) ) is amended to read as follows:
 ``

    (10) Transfer and assumption.--Upon the transfer of 
 property for which a guaranteed loan under this subsection was 
 made and the assumption of the guaranteed loan by an approved 
 eligible borrower, the original borrower of a guaranteed loan 
 under this subsection shall be relieved of liability with 
 respect to the loan.''.

SEC. 803. DEPARTMENT OF AGRICULTURE LOAN RESTRICTIONS.

    (a) 

=== Definitions. ===
-In this section, the terms ``State'' and ``Tribal 
organization'' have the meanings given those terms in 

section 658P of 
the Child Care and Development Block Grant Act of 1990 (42 U.S.C. 
9858n).

    (b) Revision.--The Secretary of Agriculture shall revise 

section 3555.102
            (c) of title 7, Code of Federal Regulations, to exclude from 
the restriction under that section--

    (1) a home-based business that is a licensed, registered, 
 or regulated child care provider under State law or by a Tribal 
 organization; and

    (2) an applicant that has applied to become a licensed, 
 registered, or regulated child care provider under State law or 
 by a Tribal organization.

 TITLE IX--ACCESSORY DWELLING UNITS

SEC. 901. LOAN GUARANTEES.

 

Section 502

    (h)

    (4) of the Housing Act of 1949 (42 U.S.C. 1472

    (h)

    (4) ) 
is amended--

    (1) by redesignating subparagraphs
        (A) ,
        (B) , and
            (C) as 
 clauses
            (i) ,
            (ii) , and
            (iii) , respectively;

    (2) by striking ``Loans may be guaranteed'' and inserting 
 the following:
 ``
        (A) === Definition. ===
-In this paragraph, the term 
 `accessory dwelling unit' means a single, habitable 
 living unit--
 ``
            (i) with means of separate ingress and 
 egress;
 ``
            (ii) that is usually subordinate in size;
 ``
            (iii) that can be added to, created 
 within, or detached from a primary 1-unit, 
 single-family dwelling; and
 ``
            (iv) in combination with a primary 1-
 unit, single-family dwelling, constitutes a 
 single interest in real estate.
 ``
        (B) Single-family requirement.--Loans may be 
 guaranteed''; and

    (3) by adding at the end the following:
 ``
            (C) Rule of construction.--Nothing in this 
 paragraph shall be construed to prohibit the leasing of 
 an accessory dwelling unit or the use of rental income 
 derived from such a lease to qualify for a loan 
 guaranteed under this subsection--
 ``
            (i) after the date of enactment of the 
 Rural Housing Service Reform Act of 2025; and
 ``
            (ii) if the property that is the subject 
 of the loan was constructed before the date of 
 enactment of the Rural Housing Service Reform 
 Act of 2025.''.

 TITLE X--TIME FRAME FOR COMPLETING APPLICATION REVIEW

SEC. 1001. APPLICATION REVIEW.

    (a) Sense of Congress.--It is the sense of Congress, not later than 
90 days after the date on which the Secretary of Agriculture receives 
an application for a loan, grant or combined loan and grant under 

section 502 or 504 of the Housing Act of 1949 (42 U.S.C. 1472, 1474), 
the Secretary of Agriculture should--

    (1) review the application;

    (2) complete the underwriting;

    (3) make a determination of eligibility with respect to the 
 application; and

    (4) notify the applicant of determination.

    (b) Report.--

    (1) In general.--Not later than 90 days after the date of 
 enactment of this Act, and annually thereafter until the date 
 described in paragraph

    (2) , the Secretary of Agriculture shall 
 submit to the Committee on Banking, Housing, and Urban Affairs 
 of the Senate and the Committee on Financial Services of the 
 House of Representatives a report--
        (A) detailing the timeliness of eligibility 
 determinations and final determinations with respect to 
 applications under 

section 502 and 504 of the Housing 
 Act of 1949 (42 U.S.C. 1472, 1474), including 
 justifications for any eligibility determinations 
 taking longer than 90 days;
        (B) that includes recommendations to shorten the 
 timeline for notifications of eligibility 
 determinations described in paragraph

    (1) to not more 
 than 90 days.

    (2) Date described.--The date described in this paragraph 
 is the date on which, during the preceding 5-year period, the 
 Secretary of Agriculture provides each eligibility 
 determination described in paragraph

    (1) during the 90-day 
 period beginning on the date on which each application is 
 received.
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