7 USC 1989 - Rules and regulations

U.S Code last checked for updates: Nov 24, 2024

§ 1989.

Rules and regulations

(a)

In general

(b)

Debt service margin requirements

Notwithstanding subsection (a), in providing farmer program loan guarantees under this chapter, the Secretary shall consider the income of the borrower adequate if the income is equal to or greater than the income necessary—

(1)

to make principal and interest payments on all debt obligations of the borrower, in a timely manner;

(2)

to cover the necessary living expenses of the family of the borrower; and

(3)

to pay all other obligations and expenses of the borrower not financed through debt obligations referred to in paragraph (1).

(c)

Certified Lenders Program

(1)

In general

(2)

Certification requirements

(3)

Condition of certification

(4)

Effect of certification

Notwithstanding any other provision of law:

(A)

The Secretary shall guarantee 80 percent of a loan made under this subsection by a certified lending institution as described in paragraph (1), subject to county committee certification that the borrower of the loan meets the eligibility requirements and such other criteria as may be applicable to loans guaranteed by the Secretary under other provisions of this chapter.

(B)

With respect to loans to be guaranteed by the Secretary under this subsection, the Secretary shall permit certified lending institutions to make appropriate certifications (as provided by regulations issued by the Secretary)—

(i)

relating to issues such as creditworthiness, repayment ability, adequacy of collateral, and feasibility of farm operation; and

(ii)

that the borrower is in compliance with all requirements of law, including regulations issued by the Secretary.

(C)

The Secretary shall approve or disapprove a guarantee not later than 14 calendar days after the date that the lending institution applied to the Secretary for the guarantee. If the Secretary rejects the loan application within the 14-day period, the Secretary shall state, in writing, all of the reasons the application was rejected.

(5)

Relationship to other requirements

(d)

Preferred Certified Lenders Program

(1)

In general

Commencing not later than two years after October 28, 1992, the Secretary shall establish a Preferred Certified Lenders Program for lenders who establish their—

(A)

knowledge of, and experience under, the program established under subsection (c);

(B)

knowledge of the regulations concerning the guaranteed loan program; and

(C)

proficiency related to the certified lender program requirements.

The Secretary shall certify any lending institution as a Preferred Certified Lender that meets such criteria as the Secretary may prescribe by regulation.

(2)

Revocation of designation

(3)

Condition of certification

(4)

Effect of preferred lender certification

Notwithstanding any other provision of law, the Secretary shall—

(A)

guarantee 80 percent of an approved loan made by a certified lending institution as described in this subsection, subject to county committee certification that the borrower meets the eligibility requirements or such other criteria as may be applicable to loans guaranteed by the Secretary under other provisions of this chapter;

(B)

permit certified lending institutions to make all decisions, with respect to loans to be guaranteed by the Secretary under this subsection relating to credit worthiness, the closing, monitoring, collection and liquidation of loans, and to accept appropriate certifications, as provided by regulations issued by the Secretary, that the borrower is in compliance with all requirements of law or regulations promulgated by the Secretary; and

(C)

be deemed to have guaranteed 80 percent of a loan made by a preferred certified lending institution as described in paragraph (1), if the Secretary fails to approve or reject the application of such institution within 14 calendar days after the date that the lending institution presented the application to the Secretary. If the Secretary rejects the application within the 14-day period, the Secretary shall state, in writing, the reasons the application was rejected.

(e)

Administration of Certified Lenders and Preferred Certified Lenders programs

(Pub. L. 87–128, title III, § 339, Aug. 8, 1961, 75 Stat. 318; Pub. L. 102–554, § 18, Oct. 28, 1992, 106 Stat. 4155; Pub. L. 106–31, title III, § 3019(a), May 21, 1999, 113 Stat. 99; Pub. L. 107–171, title V, § 5309, May 13, 2002, 116 Stat. 346; Pub. L. 115–334, title V, § 5401(d), Dec. 20, 2018, 132 Stat. 4674.)

cite as: 7 USC 1989