Default by borrower.

CFR · 2024-01-01 · US · Title 7

When there is a default by a borrower, the lender must act prudently and expeditiously in working with the borrower to bring the account current or cure the default through restructuring if a realistic plan can be developed, or to accelerate the account and conduct a liquidation in accordance with § 5001.517 and in a manner that will minimize any potential loss. (a) (1) The lender will provide this notification by submitting the guaranteed loan borrower default status report in the Agency's electronic reporting system. The lender must update the loan's status each month until such time as the loan is no longer in default. (2) If a monetary default exceeds 30 calendar days, the lender must meet with the borrower and, if necessary, the Agency within 45 calendar days of the date of the default to discuss the situation. The lender must provide the Agency with a written summary of the meeting, including any decisions and actions agreed upon within 10 calendar days of the meeting. (b) (1) Curative actions (subject to the rights of any holder and Agency concurrence) include, but are not limited to, the following options: (i) Deferment of principal and/or interest payments; (ii) An additional unguaranteed temporary loan by the lender to bring the account current; (iii) Re-amortization of or rescheduling the payments on the loan excluding capitalization of accrued interest; (iv) Transfer and assumption of the loan in accordance with § 5001.506; (v) Reorganization; (vi) Liquidation; (v

official document · source cfr-2024 · id 7:§ 5001.515