Other servicing procedures.

CFR · 2024-01-01 · US · Title 7

(a) (2) SEL and CLP lenders must not make additional loans or advances without prior written approval of the Agency, except as provided in the borrower's loan or line of credit agreement. (3) In cases of a guaranteed line of credit, lenders may make an emergency advance when a line of credit has reached its ceiling. The emergency advance will be made as an advance under the line and not as a separate note. The lender's loan documents must contain sufficient language to provide that any emergency advance will constitute a debt of the borrower to the lender and be secured by the security instrument. The following conditions apply: (i) The loan funds to be advanced are for authorized operating loan purposes; (ii) The financial benefit to the lender and the Government from the advance will exceed the amount of the advance; and (iii) The loss of crops or livestock is imminent unless the advance is made. (4) Protective advance requirements are found in § 762.149. (b) (1) The individual to be released has withdrawn from the farming operation; (2) A divorce decree or final property settlement does not hold the withdrawing party responsible for the loan payments; (3) The withdrawing party's interest in the security is conveyed to the individual or entity with whom the loan will be continued; (4) The ratio of the amount of debt to the value of the remaining security is less than or equal to .75, or the withdrawing party has no income or assets from which collection can be made; and (5)

official document · source cfr-2024 · id 7:§ 762.146