13 CFR 120.812 - Probationary period for newly certified CDCs.

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§ 120.812 Probationary period for newly certified CDCs.

(a) Newly certified CDCs will be on probation for a period of two years from the date of certification, at the end of which the CDC must petition the Lead SBA Office for:

(1) Permanent CDC status; or

(2) A single, one-year extension of probation.

(b)SBA will consider the failure to file a petition before the end of the probationary period as a withdrawal from the 504 program. If the CDC elects withdrawal, SBA will direct the CDC to transfer all funded and/or approved loans to another CDC, SBA, or another servicer approved by SBA.

(c) The Lead SBA Office will send the petition and its recommendation to the D/FA, who will make the final decision. SBA will determine permanent CDC status or an extension of probation, in part, based upon the CDC's compliance with the certification and operational requirements in §§ 120.820 through 120.830. To be considered for permanent CDC status or an extension of probation, the CDC must have satisfactory SBA performance, as determined by SBA in its discretion. The CDC's Risk Rating, among other factors, will be considered in determining satisfactory SBA performance. Other factors may include, but are not limited to, on-site review/examination assessments, historical performance measures (like default rate, purchase rate and loss rate), loan volume to the extent that it impacts performance measures, and other performance related measurements and information (such as contribution toward SBA mission).

(d)SBA will notify the CDC in writing of its decision, and, if the petition is declined, the reasons for the decision.

[68 FR 57980, Oct. 7, 2003, as amended at 73 FR 75517, Dec. 11, 2008]

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United States Code
Statutes at Large

Title 13 published on 2015-10-16

The following are ALL rules, proposed rules, and notices (chronologically) published in the Federal Register relating to 13 CFR Part 120 after this date.

  • 2016-08-09; vol. 81 # 153 - Tuesday, August 9, 2016
    1. 81 FR 52595 - Miscellaneous Amendments to Business Loan Programs and Surety Bond Guarantee Program
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      Proposed rule.
      SBA must receive comments to the proposed rule on or before October 11, 2016.
      13 CFR Parts 115 and 120
The section you are viewing is cited by the following CFR sections.

Title 13 published on 2015-10-16.

The following are only the Rules published in the Federal Register after the published date of Title 13.

For a complete list of all Rules, Proposed Rules, and Notices view the Rulemaking tab.

  • 2016-06-27; vol. 81 # 123 - Monday, June 27, 2016
    1. 81 FR 41423 - Affiliation for Business Loan Programs and Surety Bond Guarantee Program
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      Final rule.
      This rule is effective July 27, 2016.
      13 CFR Parts 109, 115, 120, and 121