---
kind: "section"
citation: "24 C.F.R. § 1005.409"
title: "24"
number: "1005.409"
heading: "Credit standing."
url: "https://uscodex.org/cfr/24/1005.409"
---

# §1005.409. Credit standing.

- (a) A Borrower must have a general credit standing satisfactory to HUD. A Direct Guarantee Lender must not use a Borrower's credit score when evaluating the Borrower's credit worthiness. The Direct Guarantee Lender must analyze the Borrower's credit history and payment pattern to determine credit worthiness.
- (b) If a Borrower had a previous default on a [Section 184](/cfr/24/184.md) Guaranteed Loan which resulted in a Claim payment by HUD, the Borrower shall be subject to a 7-year waiting period or other period as may be prescribed by [Section 184](/cfr/24/184.md) Program Guidance.

## Notes

### Authority

Authority: 12 U.S.C. 1715z-13a; 15 U.S.C. 1639c; 42 U.S.C. 3535(d).

### Source

Source: 89 FR 20056, Mar. 20, 2024; 89 FR 22084, Mar. 29, 2024, unless otherwise noted.