Lease of security.

CFR · 2024-01-01 · US · Title 7

(a) (1) The lease will not adversely affect the Agency's security interest; (2) The term of consecutive leases for agricultural purposes does not exceed 3 years, or 5 years if the borrower and the lessee are related by blood or marriage. The term of surface leases for farm property no longer in use, such as old barns, or for nonfarm purposes, such as wind turbines, communication towers, or similar installations can be for any term; (3) The lease does not contain an option to purchase; and (4) The lease does not hinder the future operation or success of the farm, or, if the borrower has ceased to operate the farm, the requirements specified in § 765.253 are met. Leases for nonfarm enterprises, such as solar farms, which take significant acreage of the operation out of agriculture production are not authorized. Non-productive land may be considered for this type of lease; and. (5) The lease and any contracts or agreements in connection with the lease must be reviewed and approved by the Government. (b) (1) For FO loans made from December 23, 1985, to February 7, 2014, and loans other than FO loans secured by real estate and made from December 23, 1985, to November 1, 2013, the value of the mineral rights must have been included in the original appraisal in order for the Agency to obtain a security interest in any oil, gas, and other mineral associated with the real estate security. (2) For all other loans not covered by paragraph (b)(1) of this section, the Agency will obtain a

official document · source cfr-2024 · id 7:§ 765.252