(a) Rural areas. Loans may be made only in rural areas designated by RHS. If an area designation is changed to non-rural:
- (1) New conditional commitments will be made and existing conditional commitments will be honored only in conjunction with an applicant for a section 502 loan who applied for assistance before the area designation changed.
- (2) REO property sales and transfers with assumption may be processed.
- (3) Subsequent loans may be made either in conjunction with a transfer with assumption of an RHS loan or to repair properties that have RHS loans.
(b) Site standards. Sites must be developed in accordance with 7 CFR part 1924, subpart C and any applicable standards imposed by a State or local government.
- (1) The site must not be large enough to subdivide into more than one site under existing local zoning ordinances and
- (2) The site must not include farm service buildings, though small outbuildings such as a storage shed may be included.
[61 FR 59779, Nov. 22, 1996, as amended at 87 FR 6772, Feb. 7, 2022]