Exhibit A to Subpart A of Part 1941 - Processing Guide - Insured Operating Loans

This exhibit outlines the basic steps involved in processing a loan application and identifies the FmHA or its successor agency under Public Law 103-354 forms which should be considered for use at each step.

Consult the appropriate Forms Manual Insert (FMI) for instructions for completion, distribution, and procedural references for each form.

Application Processing a. applicant interview

Review applicant's proposed plan of operation in view of authorized loan purposes and limitations on loans.

Begin running case record.

Provide applicant with FmHA or its successor agency under Public Law 103-354 forms to be completed and returned which are needed to determine eligibility. Be sure applicant understands the purposes of the forms and knows who must complete them.

Advise applicant of other information that must be given to FmHA or its successor agency under Public Law 103-354.

When appropriate, have applicant contact other creditors as possible credit sources for financing, or participating in the financing, of the proposed operation.

The following FmHA or its successor agency under Public Law 103-354 forms will be made available to the applicant or will be used by the County Supervisor. Forms designated with an “x” are always required and those designated with an “*” are to be used when appropriate.

Form NoName410-1Application for FHA Services(x)1910-5Request for Verification of Employment(*)410-9Statement Required by the Privacy Act(*)410-10Privacy Act Statement to References(*)1910-11Applicant Certification, Federal Collection Policies for Consumer or Commercial Debts(x)431-1Long-Time Farm and Home Plan(*)431-2Farm and Home Plan(x)431-4Business Analysis—Nonagricultural Enterprise(*)440-32Request for Statement of Debts and Collateral(*)1940-51Crop-Share-Cash Farm Lease(*)1940-53Cash Farm Lease(*)1940-55Livestock-Share-Farm Lease(*)1940-56Annual Supplement to Farm Lease(*) b. field visit

Notify applicant of planned visit and its purpose.

Evaluate the resources available to the applicant and determine whether or not they adequately fulfill the requirements of the proposed plan of operation.

Obtain information needed to complete required appraisals (chattel and real estate).

Hold landlord-tenant meeting, if necessary, to reach an agreement on the terms of the lease, resolve any problems, etc.; record in running case record.

Determine security requirements and record in running case record.

The following FmHA or its successor agency under Public Law 103-354 forms will be used as appropriate:

Form No.Name440-13Report of lien search*440-21Appraisal of chattel property*1922-1Appraisal report-farm tract*1922-2Supplemental report-irrigation, drainage, levee, and minerals*1922-3Map of property*1922-10Appraiser's worksheet-farm tract*2006-9Notice of visit or meeting* c. eligibility determination

Obtain all needed application forms, and other information from the applicant; assist the applicant in completing these forms and in obtaining needed information, as necessary.

Request copy of deed or other evidence of title, when needed.

Schedule meeting with county committee, review application and determine eligibility.

Inform applicant of the results of committee action.

The following FmHA or its successor agency under Public Law 103-354 forms will be used as appropriate in accomplishing the above actions:

Form No.Name403-1Debt Adjustment Agreement(*)440-2County Committee Certification or Recommendation(x) Docket Preparation

Obtain all information from the applicant, prior lienholder(s), landlord(s), etc., needed for the loan docket to be prepared.

Check to make sure all security requirements have been met or will be met by loan closing.

Prepare a loan narrative, for running record.

The following FmHA or its successor agency under Public Law 103-354 forms will be completed and utilized as necessary in preparing the loan docket for approval:

Form No.Name400-4Assurance Agreement(*)1927-8Agreement with Prior Lienholder(*)1940-1Request for Obligation of Funds(*)440-4Security Agreement (Chattels and Crops)(*)440-9Supplementary Payment Agreement(*)1940-20Request For Environmental Information(*)440-25/440A25Financing Statement(*)440-26Consent and Subordination Agreement(*)1940-21, 1940-22, or Exhibit H, Subpart G of Part 1940Environmental Review(*)441-5Subordination Agreement(*)441-8Assignment of Proceeds from the Sale of Products(*)441-10Nondisturbance Agreement(*)441-12Agreement for Disposition of Jointly Owned Property(*)441-13Division of Income and Nondisturbance Agreement(*)441-17Certification of Obligation to Landlord(*)441-18Consent to Payment of Proceeds from Sale of Farm Products(*)441-25Assignment of Proceeds from the Sale of Dairy Products and Release of Security Interest(*) Loan Approval and Closing a. loan approval

File financing statement or chattel mortgage, and obtain a lien search.

Request preliminary title opinion when appropriate.

Record loan closing conditions in the running record.

Execute and distribute all forms necessary for loan approval.

b. loan closing

Request needed legal services.

Arrange for loan closing by county office, escrow agent, designated attorney, or other authorized loan closing agent; furnish loan closing agent with appropriate instructions, forms, and other needed information for loan closing.

The following FmHA or its successor agency under Public Law 103-354 forms will be used by the County Office in addition to those forms listed under docket preparation which must be executed by the borrower or other party:

Form No.Name400-6Compliance Statement(*)402-1Deposit Agreement(*)402-2Statement of Deposits and Withdrawals(*)427-1 (State)Real Estate Mortgage or Deed of Trust for _____(*)1927-9Preliminary Title Opinion(*)1940-17Promissory Note(x)