§ 1980.101 - Introduction.

(a) Policy. This subpart, supplemented by subpart A of this part, contains regulations for making the following Farm Credit Programs loans guaranteed by the (Agency): Operating (OL) (both loans and lines of credit), Farm Ownership (FO), and Soil and Water (SW) loans. It also contains regulations concerning the servicing of these loans as well as the servicing of Emergency (EM) and Recreation (RL) loans, which are no longer guaranteed by Agency. It is the policy of Agency to guarantee loans made to qualified applicants without regard to race, color, religion, sex, national origin, martial status, age or physical/mental handicap, providing the applicant can execute a legal contract. These regulations apply to lenders, holders, borrowers, Agency personnel, and other parties involved in making, guaranteeing, holding, servicing, or liquidating such loans. Any processing or servicing activity conducted pursuant to this subpart involving authorized assistance to Agency employees, members of their families, known close relatives, or business or close personal associates, is subject to the provisions of subpart D of part 1900 of this chapter. Applicants for this assistance are required to identify any known relationship or association with an Agency employee. Exhibit A provides policies and procedures for the Approved Lender Program. § 1980.190 of this subpart contains the policies and procedures for the Certified Lender Program (CLP) for Guaranteed OL loans. Any modifications contained in Exhibit A of this subpart or § 1980.190 of this subpart will prevail over other provisions of this subpart. Exhibit C provides an Application Processing guide for lenders packaging applications under this subpart. Exhibit D provides policies and procedures for an Interest Assistance Program applicable for Guaranteed OL loans including lines of credit, Guaranteed FO loans and Guaranteed SW loans. Exhibit E provides policies and procedures for an Interest Rate Reduction Program for a demonstration project to purchase Farm Credit System family-size inventory farms. Exhibit F provides the procedures for the recapturing of shared appreciation when a lender requests a writedown on the debt. Exhibit G contains the policies and procedures modifying the Guaranteed OL loan regulations (Loan Note Guarantees Only), as described in § 1980.175 of this subpart, which implements the provisions of Public Law 101-82, the Disaster Assistance Act of 1989.

(b) Program administration. Farm Credit Programs are administered by the Agency Administrator through a State Director, who serves each State through District Directors and County Supervisors. The County Supervisor is the focal point for the program and is the local contact person for processing and servicing activities, even though this subpart refers in various places to the duties and responsibilities of other Agency employees.

(c) Administrative provisions. Within this subpart there are administrative provisions which, for the benefit of the State Directors, District Directors, and County Supervisors, set out the internal duties and responsibilities of FmHA or its successor agency under Public Law 103-354 personnel and outline the procedures to be followed in carrying out the requirements of the program. These provisions are identified as “ADMINISTRATIVE” and correspond to the sections of this subpart which they follow.

(1)-(2) [Reserved]

(d) References. Sections 1980.101—1980.174 pertain to the FO, EM, OL, RL, and SW loan programs. The requirements set forth in Subpart A of Part 1980 of this chapter which are not in conflict with the provisions set forth in this subpart must be met.

(e) Type of guarantee—(1) Loan Note Guarantee. Lenders desiring to sell the guaranteed portion of fixed amount and term loans will use the method contained in Subpart A of this part. In accordance with that method, loans may be made by a lender and guaranteed by issuance of Form FmHA 449-34, “Loan Note Guarantee.”

(2) Contract of Guarantee (Operating Loans—Line of Credit only). Lenders desiring a guarantee on a “line of credit” will use the method contained in subpart A of this part. Line of credit loans are guaranteed in accordance with Form FmHA 1980-27, “Contract of Guarantee (Line of Credit).” Line of credit notes and agreements may not be sold by the originating lender, but the originating lender may use participating lenders in accordance with § 1980.119. Any amount advanced by the lender in excess of the line of credit ceiling set forth in the contract is not guaranteed by the Agency.