§ 1948.125 - Loan approval and obligating funds.

The loan will be considered approved on the date the signed copy of Form FmHA 1940-1 is mailed to the intermediary. The Administrator or designee may request an obligation of funds when available and according to the following:

(a) Form FmHA 1940-1, authorizing funds to be reserved, may be executed by the loan approving official providing the intermediary has the legal authority to contract for a loan, and to enter into required agreements and has signed Form FmHA 1940-1.

(b) If approval was concurred in by the National Office, a copy of the concurring memorandum will be attached to the original of Form FmHA 1940-1.

(c) The Administrator or designee will request an obligation of loan funds by signing Form FmHA 1940-1, contacting the Finance Office Appropriation Accounting Section by telephone, and then mailing a copy of the Form FmHA 1940-1 to the Finance Office.

(d) The obligation date and date the intermediary is notified of loan approval is six working days from the date funds are reserved unless an exception is granted by the National Office.

(e) Immediately after verifying by telephone contact with the Finance Office that funds have been reserved, the Administrator or designee will notify the Legislative Affairs and Public Information Staff in the National Office as required by FmHA Instruction 2015-C (available in any FmHA or its successor agency under Public Law 103-354 State Office).

(f) The Administrator or designee will record the date of intermediary notification on the original of Form FmHA 1940-1 and include it as a permanent part of the official FmHA or its successor agency under Public Law 103-354 file.

(g) If a transfer of obligation of funds is necessary, complete Form FmHA 450-10, “Advice of Borrower's Change of Address, Name, Case Number, or Loan Number,” and mail a copy to the Finance Office. An obligation of funds established for an intermediary may be transferred to a different (substituted) intermediary provided:

(1) The substituted intermediary is eligible to receive the assistance approved for the original intermediary;

(2) The substituted intermediary bears a close and genuine relationship to the original intermediary; and

(3) The need for and scope of the project and the purpose(s) for which FmHA or its successor agency under Public Law 103-354 funds will be used remain substantially unchanged.