§ 762.160 7 CFR Ch. VII (1–1–06 Edition)
§ 762.160 Assignment of guarantee. (2) The lender will send the holder
(a) The following general require- the borrower’s executed note attached
ments apply to assigning guaranteed to the Guarantee.
loans: (3) The holder, upon written notice to
(1) Subject to Agency concurrence, the lender and the Agency, may assign
the lender may assign all or part of the the unpaid guaranteed portion of the
guaranteed portion of the loan to one loan. The holder must assign the guar-
or more holders at or after loan clos- anteed portion back to the original
ing, if the loan is not in default. How- lender if requested for servicing or liq-
ever, a line of credit cannot be as- uidation of the account.
signed. The lender must always retain (4) The Guarantee or Assignment of
the unguaranteed portion in their port- Guarantee in the holder’s possession
folio, regardless of how the loan is does not cover:
funded. (i) Interest accruing 90 days after the
(2) The Agency may refuse to execute holder has demanded repurchase by the
the Assignment of Guarantee and pro- lender, except as provided in the As-
hibit the assignment in case of the fol- signment of Guarantee and
lowing: § 762.144(c)(3)(iii).
(i) The Agency purchased and is hold- (ii) Interest accruing 90 days after
er of a loan that was assigned by the the lender or the Agency has requested
lender that is requesting the assign- the holder to surrender evidence of
ment. debt repurchase, if the holder has not
(ii) The lender has not complied with previously demanded repurchase.
the reimbursement requirements of (c) Negotiations concerning pre-
§ 762.144(c)(7), except when the 180 day miums, fees, and additional payments
reimbursement or liquidation require- for loans are to take place between the
ment has been waived by the Agency. holder and the lender. The Agency will
(3) The lender will provide the Agen- participate in such negotiations only
cy with copies of all appropriate forms as a provider of information.
used in the assignment.
[70 FR 56107, Sept. 26, 2005]
(4) The guaranteed portion of the
loan may not be assigned by the lender
until the loan has been fully disbursed PART 764—EMERGENCY FARM
to the borrower. LOANS
(5) The lender is not permitted to as-
sign any amount of the guaranteed or Sec.
unguaranteed portion of the loan to 764.1 Purpose.
the loan applicant or borrower, or 764.2 Definitions.
members of their immediate families, 764.3 Emergency loan funds uses.
their officers, directors, stockholders, 764.4 Eligibility requirements.
764.5 Limitations.
other owners, or any parent, sub-
764.6 Interest rate.
sidiary, or affiliate. 764.7 Loan terms.
(6) Upon the lender’s assignment of 764.8 Repayment and security requirements.
the guaranteed portion of the loan, the 764.9 Appraisal and valuation requirements.
lender will remain bound to all obliga- 764.10 Insurance for loan security.
tions indicated in the Guarantee, Lend- 764.11 Charges and fees.
er’s Agreement, the Agency program
AUTHORITY: 5 U.S.C. 301 and 7 U.S.C. 1989.
regulations, and to future program reg-
ulations not inconsistent with the pro- SOURCE: 67 FR 795, Jan. 8, 2002, unless oth-
visions of the Lenders Agreement. The erwise noted.
lender retains all rights under the se-
curity instruments for the protection § 764.1 Purpose.
of the lender and the United States. The purpose of the Emergency Loan
(b) The following will occur upon the Program is to provide financial assist-
lender’s assignment of the guaranteed ance to family farmers who have suf-
portion of the loan: fered losses as the result of a disaster
(1) The holder will succeed to all so that they can return to normal
rights of the Guarantee pertaining to farming operations as soon as possible
the portion of the loan assigned. after the disaster. Specifically, this
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Farm Service Agency, USDA § 764.2
part describes the policies and proce- to the Agency under any Farm Loan
dures of the Agency for making Emer- Program loan, without regard to
gency loans to operators of such farms. whether the loan has been accelerated.
A borrower includes all parties liable
§ 764.2 Definitions. for such obligation owed to the Agen-
Act means the Consolidated Farm cy, including collection-only bor-
and Rural Development Act (7 U.S.C. rowers, except for debtors whose total
1921 et seq.). loans and accounts have been volun-
Additional security means property tarily or involuntarily foreclosed, sold,
that provides security in excess of the or conveyed; or who have been dis-
amount of security value equal to the charged of all such obligations owed to
loan amount, excluding security de- the Agency.
scribed in § 764.8(g). Chattel means any property that is
Adequate security means property not real estate.
that provides a security value at least Chattel or real estate essential to the
equal to the loan amount. farming operation means chattel or real
Agency means the Farm Service estate that would be necessary for the
Agency, including its employees, any applicant to continue operating the
predecessor agency, and any successor farm on and after the disaster in a
agency. manner similar to the manner in which
Agricultural commodity means live- the farm was operated immediately
stock, grains, cotton, oilseeds, dry prior to the disaster, as determined by
beans, tobacco, peanuts, sugar beets, the Agency.
sugar cane, fruit, vegetable, forage, Corporation means a private domestic
tree farming, nursery crops, nuts, entity recognized as a corporation and
aquacultural species, and other plant authorized as a corporation under the
or animal production as determined by laws of the State or States in which
the Agency. the entity does business.
Allowable costs means those costs for County means a local administrative
replacement or repair that are sup- subdivision of a State or similar polit-
ported by acceptable documentation, ical subdivision of the United States.
including but not limited to written es-
Debt forgiveness means reducing or
timates, invoices, and bills.
terminating a debt under the Act in a
Applicant means an individual or en-
manner that results in a loss to the
tity (including each owner of the enti-
Agency (excluding a consolidation, re-
ty unless specified otherwise) operating
scheduling, reamortization, or defer-
a farming operation at the time of the
ral), through:
disaster, who is requesting assistance
from the Agency under this part. All (1) Writing down or writing off a debt
requirements of applicants apply to pursuant to 7 U.S.C. 2001;
owners of the entity individually and (2) Compromising, adjusting, reduc-
collectively unless specified otherwise. ing, or charging off a debt or claim pur-
Aquacultural species means aquatic suant to 7 U.S.C. 1981; or
organisms (including fish, mollusks, (3) Paying a loss pursuant to 7 U.S.C.
crustaceans or other invertebrates, am- 2005 on a Farm Loan Program loan
phibians, reptiles, or aquatic plants) guaranteed by the Agency.
raised in a controlled or selected envi- Disaster means an event of unusual
ronment which the applicant has exclu- and adverse weather conditions, other
sive rights to use. natural phenomena, or quarantine,
Basic part of an applicant’s total farm- that has substantially affected pro-
ing operation means any single agricul- ducers of agricultural commodities by
tural commodity or livestock produc- causing physical property or produc-
tion enterprise of an applicant’s farm- tion losses in a county, or similar po-
ing operation which normally gen- litical subdivision, that triggered the
erates sufficient income to be consid- inclusion of such county or political
ered essential to the success of such subdivision in the disaster area des-
farming operation. ignated by the Agency.
Borrower means an individual or enti- Disaster area means the county, de-
ty which has an outstanding obligation clared or designated as a disaster area
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