Rural Development (RD) is pleased to announce new decoupling authority, provided in the Consolidated Appropriations Act of 2024, to decouple Rural Housing Service (RHS) (hereinafter the “Agency”) rental assistance (RA) from direct loans for maturing properties. Currently, when a USDA-RHS financed Multifamily Housing (MFH) Section 514/515 mortgage matures the property is no longer eligible to receive RA. With the new decoupling authority, owners can apply to continue receiving long-term RA if they agree to continue operating their property as affordable housing. 

Decoupling RA from the Section 514/515 loan has emerged as a primary strategy to preserve affordable housing for tenants while supporting rehabilitation and preservation of the portfolio with outside financing. The Agency conducted listening sessions during Summer 2023 to obtain input on the resources, tools and policies needed to successfully implement decoupling. Stakeholders were very supportive of the Agency receiving decoupling authority.

Under the provisions of the Consolidated Appropriations Act of 2024, RHS is developing policies that will allow for the decoupling for up to 1,000 rental assistance units. A notice to identified maturing mortgage borrowers will be issued to outline eligibility requirements, rent-setting structure, terms of the new RA contract, and Agency oversight requirements. In addition to the notice, a Fact Sheet with questions and answers is under development and will provide consistent and updated information for MFH staff and external partners.  

Currently, when a USDA-financed MFH Section 514/515 mortgage matures and the Agency accepts the final payment, the property is no longer eligible to receive rental assistance. With the new decoupling authority, current loan borrowers with a mortgage that is maturing in Fiscal Year 2024 can apply to participate in decoupling. Please note: Decoupling is not available to owners/borrowers who submitted, and the Agency processed the final loan payment prior to the enactment of the decoupling authority on March 9, 2024. Additionally, decoupling is not available to borrowers through the prepayment process.

Decoupling does not prevent borrowers with a maturing mortgage from paying their loan in full.  If a borrower is not interested in decoupling, the borrower may submit its final payment at loan maturity. At the time of maturity, the Section 521 Rental Assistance will end and existing tenants residing at the property will be offered RD vouchers.

If you have any questions or require additional information regarding this notice or the decoupling authority, please do not hesitate to contact the Decoupling Team at Our attention will be on those properties eligible for decoupling during Fiscal Year 2024.  A stakeholder engagement call is scheduled for April 25, 2024 at 2:00 PM EDT providing a platform to highlight the authority, implementation strategy, and solicit important stakeholder feedback. We encourage your participation and invite you to register here: Decoupling Program Development Stakeholder Session Registration