USDA Revokes Approved Lender Status of Ten OneRD Lenders
- F.I. Editorial Team
- 21 hours ago
- 3 min read
The USDA has revoked or declined to renew the approved lender status of ten lenders in its OneRD Guaranteed Lending Program after a review found significant noncompliance and roughly $620 million in delinquent loans tied to those lenders. The move is a rare and direct enforcement action inside a government-backed lending program that supports rural businesses, infrastructure, community facilities, and energy projects.
USDA Takes Action Against Ten Approved Lenders
The U.S. Department of Agriculture has removed ten lenders from participation in its Rural Development OneRD Guaranteed Lending Program, citing irresponsible lending, noncompliance, and a large concentration of delinquent loans.
According to the USDA’s May 12, 2026 announcement, the ten lenders collectively held approximately $620 million in delinquent loans, representing about 47% of Rural Development’s total delinquent loans. The agency said the lenders will be precluded from further participation in the program.
The lenders named by USDA are:
Bank of Montgomery, also known as BOM Bank
Byline Bank
Celtic Bank
Community Bank & Trust – West Georgia
Genisys Credit Union
Greater Nevada Credit Union
North Avenue Capital
Optus Bank
U.S. Eagle Federal Credit Union
ReadyCap Commercial
This is not a small administrative update. It is a direct signal that USDA Rural Development is tightening oversight on lenders that participate in government-guaranteed loan programs.
What the OneRD Guaranteed Lending Program Does
The OneRD Guaranteed Lending Program is USDA Rural Development’s unified platform for several rural development loan guarantee programs. It was created to streamline and modernize guaranteed lending across four major program areas: Community Facilities, Water and Waste Disposal, Business and Industry, and Rural Energy for America Program loan guarantees.
In simple terms, USDA does not always lend directly through these programs. Instead, approved private lenders make loans to eligible borrowers, and the USDA provides a federal guarantee on a portion of those loans. That guarantee reduces lender risk and helps rural businesses, nonprofits, public bodies, and community projects access capital that may otherwise be difficult to obtain.
The Business and Industry Guaranteed Loan program, for example, offers loan guarantees to lenders financing rural businesses. USDA says eligible uses may include business expansion, real estate, equipment, modernization, acquisitions, and certain debt refinancing when it improves cash flow and supports jobs.
That structure is why lender quality matters. When a private lender participates in a federal guarantee program, the lender is not just making a private credit decision. It is also helping manage taxpayer-backed risk.
Why USDA Says These Lenders Were Removed
USDA’s public announcement was blunt. Agriculture Secretary Brooke Rollins said the administration has “no tolerance” for irresponsible and noncompliant actions by lenders participating in USDA guaranteed lending programs.
The USDA Rural Development OneRD FAQ provides more detail. According to the agency, Rural Development’s Special Assets Unit and External Review Division worked with the Rural Business-Cooperative Service on desk audits of the lenders’ portfolios. USDA said those audits showed significant findings of noncompliance with OneRD regulatory requirements, and that the lenders were provided final audit reports.
That distinction is important. The USDA’s action was not based only on the fact that the lenders had delinquent loans. Delinquencies can happen in any lending program, especially in higher-risk or development-focused markets. The agency said the issue involved both delinquency concentration and regulatory noncompliance.
Existing Loans and Pending Commitments Are Not Automatically Erased
One immediate question for borrowers and referral partners is what happens to existing loans or applications already in process.
According to the USDA’s OneRD FAQ, existing conditional commitments will be honored for a period of 30 days from the notice of revocation, as long as appropriate conditions and certifications are met. USDA also says revoked lenders may transfer applications or loans with conditional commitments to a new, non-revoked lender, but the receiving lender must conduct its own underwriting and due diligence.
USDA also states that revoked lenders remain responsible for servicing outstanding guaranteed loans in accordance with the lender agreement and applicable regulations. However, those lenders cannot submit requests for new loan guarantees under OneRD.
That means this action does not necessarily unwind every existing borrower relationship overnight, but it does create urgency for borrowers, brokers, developers, and project sponsors with pending USDA-backed financing through one of the affected lenders.
Bottom Line
For the lending industry, this is a reminder that federal guarantee programs come with federal oversight. For borrowers and brokers, it is a reminder to verify lender status early, especially when a project depends on a government-backed loan approval.
The USDA is sending the message that approved lender status is not automatic, and participation in taxpayer-backed lending programs comes with accountability.
