(a) Interest accrual. Interest will accrue on any principal portion of the DBSA installment at the rate of one eighth of a percent.

(b) Due date. The DBSA amount, including interest accrued on the principal portion of the set-aside, is due on or before the final due date of the loan.

(c) Applying payments. The Agency will apply borrower payments toward DBSA installments first to interest and then to principal.