§ 2202d. Protection of borrowers who meet all loan obligations

Statutory text

Foreclosure prohibited

A qualified lender may not foreclose on any loan because of the failure of the borrower thereof to post additional collateral, if the borrower has made all accrued payments of principal, interest, and penalties with respect to the loan.

Prohibition against required principal reduction

A qualified lender may not require any borrower to reduce the outstanding principal balance of any loan made to the borrower by any amount that exceeds the regularly scheduled principal installment payment (when due and payable), unless—

the borrower sells or otherwise disposes of part or all of the collateral; or

the parties agree otherwise in a written agreement entered into by the parties.

Nonenforcement

After a borrower has made all accrued payments of principal, interest, and penalties with respect to a loan made by a qualified lender, the lender shall not enforce acceleration of the borrower’s repayment schedule due to the borrower having not timely made one or more principal or interest payments.

Placing loans in nonaccrual status

Notification

If a qualified lender places any loan in nonaccrual status, the lender shall document such change of status and promptly notify the borrower thereof in writing of such action and the reasons therefor.

Review of denial

If the borrower was not delinquent in any principal or interest payment under the loan at the time of such action and the borrower’s request to have the loan placed back into accrual status is denied, the borrower may obtain a review of such denial before the appropriate credit review committee under section 2202 of this title.

Application

This subsection shall only apply if a loan being placed in nonaccrual status results in an adverse action being taken against the borrower.

Legislative history

Reconstructed from this section’s Code source credit and amendment notes, resolved against the local Statutes at Large. Editorial notes are evidence, not the law that made the change.

1988
Farm Credit Act of 1971
Pub. L. 92–181 title IV § 4 · 85 Stat. 583
Enacted · 12 U.S.C. § 2202d
(Pub. L. 92–181, title IV, § 4.14D, as added Pub. L. 100–233, title I, § 107, Jan. 6, 1988, 101 Stat. 1581.)
Source evidence
Code source credit
(Pub. L. 92–181, title IV, § 4.14D, as added Pub. L. 100–233, title I, § 107, Jan. 6, 1988, 101 Stat. 1581.)
Enacted provision · exact public law section
(4) Sue and be sued.

1 of 1 references resolved to an enrolled provision

Credits

(Pub. L. 92–181, title IV, § 4.14D, as added Pub. L. 100–233, title I, § 107, Jan. 6, 1988, 101 Stat. 1581.)