Transfer of security and assumption of loans.

CFR · 2024-01-01 · US · Title 7

(a) (1) The present borrower is unable or unwilling to accomplish the objectives of the loan. (2) The transfer will not be disadvantageous to the Government or adversely affect either Rural Development's security position or the Rural Development program in the area. (3) Transfers to eligible applicants will receive preference over transfers to ineligible applicants if recovery to Rural Development is not less than it would be if the transfer were to an ineligible applicant. (4) If the Rural Development debt(s) exceed the present market value of the security as determined by the State Director, the transferee will assume an amount at least equal to the present value. (5) If the transfer and assumption is to one or more members of the borrower's organization, there must not be a loss to the government. (6) Rural Development concurs in plans for disposition of funds in the transferor's debt service, reserve, operation and maintenance, and any other project account, including supervised bank accounts. (7) When the property to be transferred is to be used for the same or similar purposes for which the loan was made, the transferee will execute Form RD 400-4 to continue nondiscrimination covenants and provide to Rural Development a written certification assuming all terms of the Grant Agreement executed by the transferor. All instruments of conveyance will contain the covenant referenced in § 1951.204 of this subpart. (8) This subpart does not preclude the transferor from receivin

official document · source cfr-2024 · id 7:§ 1951.230