General.

CFR · 2024-01-01 · US · Title 12

Direct lenders shall be responsible for the servicing of the loans that they make. However, loan participation agreements may designate specific loan servicing efforts to be accomplished by a participating institution. Each direct lender shall adopt loan servicing policies and procedures to assure that loans will be serviced fairly and equitably for the borrower while minimizing the risk for the lender. Procedures shall include specific plans that help preserve the quality of sound loans and that help correct credit deficiencies as they develop. (a) The Farm Credit Bank shall provide guidelines for the servicing of loans by the Federal land bank associations. The servicing may be accomplished either under the direct supervision of the bank or under delegated authority. (b) The servicing of loans which are participated in by Farm Credit System institutions shall be in accordance with § 614.4325. (c) In the development of loan servicing policies and procedures, the following criteria shall be included: (1) (2) (i) The procurement of periodic operating data essential for maintaining control, for the proper analysis of such data, and prompt action as needed; (ii) Inspections, reappraisals, and borrower visits appropriate to the nature and quality of the loan; and (iii) Controls on insurance, margin requirements, warehousing, and the prompt exercise of legal options to preserve the lender's collateral position and guard against loss. (3)

official document · source cfr-2024 · id 12:§ 614.4170