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Code of Federal Regulations (Last Updated: October 10, 2024) |
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Title 7 - Agriculture |
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Subtitle B - Regulations of the Department of Agriculture |
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Chapter XVIII - Rural Housing Service, Rural Business-Cooperative Service, Rural Utilities Service, and Farm Service Agency, Department of Agriculture |
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SubChapter H - Program Regulations |
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Part 1951 - Servicing and Collections |
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Subpart F - Analyzing Credit Needs and Graduation of Borrowers |
§ 1951.253 - Objectives.
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§ 1951.253 Objectives.
(a) [Reserved]
(b) Borrowers must graduate to other credit at reasonable rates and terms when they are able to do so.
(c) If a borrower refuses to graduate, the account will be liquidated under the following conditions:
(1) The borrower has the legal capacity and financial ability to obtain other credit.
(2) Other credit is available from a commercial lender at reasonable rates and terms. In the case of Labor Housing (LH), Rural Rental Housing (RRH), and Rural Cooperative Housing (RCH) Programs, reasonable rates and terms must also permit the borrowers to continue providing housing for low and moderate income persons at rental rates tenants can afford considering the loss of any subsidy which will be canceled when the loan is paid in full.
(d) The Agency will enforce borrower graduation.