(a) Eligibility. The Agency may approve transfers and assumptions of AMP loans when:
(1) The present borrower is unable or unwilling to accomplish the objectives of the loan;
(2) The transfer will not harm the Government or adversely affect the Agency's security position;
(3) The transferee will continue with the original purpose of the loan;
(4) The transferee will assume an amount at least equal to the present market value of the loan security;
(5) The transferee documents the ability to pay the AMP loan debt as provided in the assumption agreement and has the legal capacity to enter into the contract;
(6) If there is a lien or judgment against the Agency security being transferred, the transferee is subject to such claims. The transferee must document the ability to repay the claims against the land; and
(7) If the transfer is to one or more members of the borrower's organization and there is no new member, there must not be a loss to the Government.
(b) Withdrawal. Withdrawal of a member and transfer of the withdrawing member's interest in the Association to a new eligible member may be approved by the Agency if all of the following conditions are met:
(1) The entire unpaid balance of the withdrawing member's share of the AMP loan must be assumed by the new member;
(2) In accordance with the Association's governing articles, the required number of remaining members must agree to accept any new member; and
(3) The transfer will not adversely affect collection of the AMP loan.
(c) Requesting a transfer and assumption. The transferor/borrower and transferee/applicant must submit:
(1) The written consent of any other lienholder, if applicable.
(2) A current balance sheet and cash flow statement.
(d) Terms. The interest rate and term of the assumed AMP loan will not be changed. Any delinquent principal and interest of the AMP loan must be paid current before the transfer and assumption will be approved by the Agency.
(e) Release of liability. Transferors may be released from liability with respect to an AMP loan by the Agency when:
(1) The full amount of the loan is assumed; or
(2) Less than the full amount of the debt is assumed, and the balance remaining will be serviced in accordance with § 772.9(c).
Title 7 published on 2013-01-01
no entries appear in the Federal Register after this date.
This is a list of United States Code sections, Statutes at Large, Public Laws, and Presidential Documents, which provide rulemaking authority for this CFR Part.