At the time of application, the local department shall ask if any household member, or ineligible or disqualified individual whose resources are considered available to the household, transferred resources within the 3-month period immediately preceding the date of application. A household which has transferred resources for the purpose of qualifying or attempting to qualify for benefits is disqualified from participating in the Program as described in §F of this regulation if the resources are transferred: In the 3-month period before application; or After the household is determined eligible for benefits. Imposition of a Disqualification Period. If the household has an application pending at the time of discovery of the transfer, the local department shall: Send a written notice of denial explaining the reason for and length of the disqualification; and Begin the period of disqualification in the month of application. If the household is participating in the Program at the time of discovery of the transfer, the local department shall: Send a notice of adverse action explaining the reason for and length of the disqualification; and Begin the period of disqualification effective with the allotment that would have been issued after the notice of adverse action period had expired, unless the household requested a fair hearing and continued benefits. Eligibility for the Program may not be affected by the following exempted transfers: Resources that would not otherwise affect eligibility such as resources consisting of excluded personal property or money that, when added to other non-exempt household resources, totaled less at the time of the transfer than the allowable resource limits; Resources that are sold or traded at, or near, fair market value; Resources which are transferred between members of the same household, including ineligible aliens or disqualified individuals whose resources are being considered available to the household; and Resources that are transferred for reasons other than qualifying or attempting to qualify for benefits. The local department shall base the length of the disqualification period on the amount by which non-exempt transferred resources, when added to other countable resources, exceeds the allowable resource limit. The following chart shall be used to determine the period of disqualification: The local department may not count resources of nonhousehold members as available to the household, but shall count resources of excluded members as available to the remaining household members.