(a) The intermediary must submit a proposed relending plan which, once approved by the Agency, will be incorporated by reference as an attachment to the HPRP loan agreement. The relending plan will explain in sufficient detail the mechanics of how the funds will be distributed from the intermediary to the ultimate recipient.

(b) The intermediary's relending plan must include copies of the intermediary's proposed application forms, loan documents and security instruments, and should include information regarding:

(1) The service area;

(2) The proposed fees and other charges the intermediary will assess the ultimate recipients;

(3) Eligibility criteria for the ultimate recipient;

(4) Authorized loan purposes;

(5) Loan limitations;

(6) Loan underwriting methods and criteria;

(7) Loan rates and terms;

(8) Security requirements;

(9) The method of disbursement of the funds to the ultimate recipient;

(10) The process for addressing environmental issues on property to be purchased;

(11) The proposed process for reviewing loan requests from ultimate recipients and making eligibility determinations;

(12) A description of the established internal credit review process;

(13) The monitoring and servicing of loans distributed to the ultimate recipients;

(14) The amount that will be set aside to maintain a reserve for bad debts; and

(15) A description of the requirements for maintaining adequate hazard insurance, life insurance (for principals and key employees of the ultimate recipient), workmen's compensation insurance on ultimate recipients, flood insurance, and fidelity bond coverage.