Compromise and adjustment of nonjudgment debts.

CFR · 2024-01-01 · US · Title 7

Nonjudgment debts which the debtor is unable to pay may be compromised or adjusted in accordance with applicable provisions of this section, and the debtor may retain the security property, if any. Application will be made on Form RD 1956-1 by the debtor; or if the debtor is unable to act, by another party having legal authority to act for the debtor. Collection of a lump sum offer may be deferred until the debtor is advised that the offer is approved. Upon full payment of the approved compromise or adjustment amount, the Agency will release the debtor from liability by delivering the note(s) to the debtor stamped “Satisfied by compromise or adjustment.” (a) (1) Security may be retained by the debtor if the debtor offers an amount at least equal to the current fair market value (including any crop security) less any prior lien amounts. Any remaining unsecured debt may be debt settled. (2) Where the debtor is able to pay an amount in excess of the lump sum compromise offer, an adjustment offer must call for a lump sum payment as set out in paragraph (a)(1) of this section, plus any additional amounts the Agency determines the debtor is able to pay over a period of time not to exceed 5 years. (3) The acceptability of a compromise or adjustment offer will be arrived at by determining and evaluating: (i) Statement of indebtedness owed on any prior liens. Statements will be retained in the debtor's file. (ii) Value of existing security as determined by a current appraisal made or

official document · source cfr-2024 · id 7:§ 1956.66