cfr_sections
Data license: Public Domain (U.S. Government data) · Data source: Federal Register API & Regulations.gov API
66 rows where agency = "FSA" and part_number = 764 sorted by section_id
This data as json, CSV (advanced)
Suggested facets: subpart, subpart_name
| section_id ▼ | title_number | title_name | chapter | subchapter | part_number | part_name | subpart | subpart_name | section_number | section_heading | agency | authority | source_citation | amendment_citations | full_text |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 7:7:7.1.1.4.15.1.9.1 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | A | Subpart A—Overview | § 764.1 Introduction. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 75 FR 54015, Sept. 3, 2010; 78 FR 3835, Jan. 17, 2013; 81 FR 3292, Jan. 21, 2016] | (a) Purpose. This part describes the Agency's policies for making direct FLP loans. (b) Types of loans. The Agency makes the following types of loans: (1) FO, including ML and Downpayment loans; (2) OL, including ML and Youth loans; (3) EM; and (4) CL. | |||
| 7:7:7.1.1.4.15.1.9.2 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | A | Subpart A—Overview | § 764.2 Abbreviations and definitions. | FSA | Abbreviations and definitions for terms used in this part are provided in § 761.2 of this chapter. | ||||
| 7:7:7.1.1.4.15.1.9.3 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | A | Subpart A—Overview | §§ 764.3-764.50 [Reserved] | FSA | |||||
| 7:7:7.1.1.4.15.10.9.1 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | J | Subpart J—Loan Decision and Closing | § 764.401 Loan decision. | FSA | (a) Loan approval. (1) The Agency will approve a loan only if it determines that: (i) The applicant's farm operating plan reflects a feasible plan, which includes repayment of the proposed loan and demonstrates that all other credit needs can be met; (ii) The proposed use of loan funds is authorized for the type of loan requested; (iii) The applicant has been determined eligible for the type of loan requested; (iv) All security requirements for the type of loan requested have been, or will be met before the loan is closed; (v) The applicant's total indebtedness to the Agency, including the proposed loan, will not exceed the maximum limits established in § 761.8 of this chapter; (vi) There have been no significant changes in the farm operating plan or the applicant's financial condition since the time the Agency received a complete application; and (vii) All other pertinent requirements have been, or will be met before the loan is closed. (2) The Agency will place conditions upon loan approval it determines necessary to protect its interest and maximize the applicant's potential for success. (b) Loan denial. The Agency will not approve a loan if it determines that: (1) The applicant's farm operating plan does not reflect a feasible plan; (2) The proposed use of loan funds is not authorized for the type of loan requested; (3) The applicant does not meet the eligibility requirements for the type of loan requested; (4) There is inadequate security for the type of loan requested; (5) Approval of the loan would cause the applicant's total indebtedness to the Agency to exceed the maximum limits established in § 761.8 of this chapter; (6) The applicant's circumstances may not permit continuous operation and management of the farm; or (7) The applicant, the farming operation, or other circumstances surrounding the loan are inconsistent with the authorizing statutes, other Federal laws, or Federal credit policies. (c) Overturn of an Agency decision by appeal. If an FLP loan denial is overturned on ad… | ||||
| 7:7:7.1.1.4.15.10.9.2 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | J | Subpart J—Loan Decision and Closing | § 764.402 Loan closing. | FSA | [72 FR 63298, Nov. 8, 2007. Redesignated at 75 FR 54015, Sept. 3, 2010, as amended at 77 FR 15939, Mar. 19, 2012; 79 FR 60745, Oct. 8, 2014; 87 FR 13124, Mar. 9, 2022; 89 FR 65041, Aug. 8, 2024] | (a) Signature requirements. Signatures on loan documents are required as follows: (1) For individual applicants, only the applicant is required to sign the promissory note. (2) For entity applicants, the promissory note will be executed to evidence the liability of the entity, any embedded entities, and the individual liability of all entity members. (3) Despite minority status, a youth executing a promissory note for a Youth loan will incur full personal liability for the debt. (4) A cosigner will be required to sign the promissory note if they assist the applicant in meeting the repayment requirements for the loan requested. (5) All signatures needed for the Agency to acquire the required security interests will be obtained according to State law. (b) Payment of fees. The applicant, or in the case of a real estate purchase, the applicant and seller, must pay all filing, recording, notary, lien search, and any other fees necessary to process and close a loan. (c) Chattel-secured loans. The following requirements apply to loans secured by chattel: (1) The Agency will close a chattel loan only when it determines the Agency requirements for the loan have been satisfied; (2) A financing statement is required for every loan except when a filed financing statement covering the applicant's property is still effective, covers all types of chattel property that will serve as security for the loan, describes the land on which crops and fixtures are or will be located, and complies with the law of the jurisdiction where filed; (3) A new security agreement is required for new loans, as necessary to secure the loan under State law, prior to the disbursement of loan funds. (d) Real estate-secured loans. (1) The Agency will close a real estate loan only when it determines that the Agency requirements for the loan have been satisfied and the closing agent can issue a policy of title insurance or final title opinion as of the date of closing. The title insurance or final title opinion requirement may be waived… | |||
| 7:7:7.1.1.4.15.10.9.3 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | J | Subpart J—Loan Decision and Closing | §§ 764.403-764.450 [Reserved] | FSA | |||||
| 7:7:7.1.1.4.15.11.9.1 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | K | Subpart K—Borrower Training and Training Vendor Requirements | § 764.451 Purpose. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 89 FR 65041, Aug. 8, 2024] | The purpose of borrower training is to help an applicant develop and improve skills necessary to: (a) Successfully operate a farm; (b) Build equity in the operation; and (c) Become financially successful and prepared to graduate from Agency financing to commercial sources of credit. | |||
| 7:7:7.1.1.4.15.11.9.2 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | K | Subpart K—Borrower Training and Training Vendor Requirements | § 764.452 Borrower training requirements. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 89 FR 65041, Aug. 8, 2024] | (a) The applicant must agree to complete financial management training, unless the Agency provides a waiver in accordance with § 764.453, or the applicant has previously satisfied the training requirements. In the case of an entity: (1) Any individual member holding a majority interest in the entity or who is operating the farm must complete training on behalf of the entity, except as provided in paragraph (a)(2) of this section; (2) If one entity member is solely responsible for financial management, then only that member will be required to complete training. (b) When the Agency determines that financial management training is required, the applicant must agree to complete course work covering all aspects of farm accounting and integrating accounting elements into a financial management system. (c) Even if a waiver is granted, the borrower must complete borrower training as a condition for future loans if and when Agency supervision provided in 7 CFR part 761 subpart C reflects that such training is needed. (d) The Agency cannot reject a request for a direct loan based solely on an applicant's need for training. (e) The Agency will provide written notification of required training or waiver of training. | |||
| 7:7:7.1.1.4.15.11.9.3 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | K | Subpart K—Borrower Training and Training Vendor Requirements | § 764.453 Agency waiver of training requirements. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 86 FR 43392, Aug. 9, 2021; 89 FR 65042, Aug. 8, 2024] | (a) The applicant must request the waiver in writing. (b) The Agency will grant a waiver for training in financial management under the following conditions: (1) The applicant submits evidence of successful completion of a course similar to a course approved under section § 764.457 and the Agency determines that additional training is not needed; or (2) The applicant submits evidence which demonstrates to the Agency's satisfaction the applicant's experience and training necessary for a successful and efficient operation. (c) If the financial functions of the operation are shared among individual entity members, the Agency will consider the collective knowledge and skills of those individuals when determining whether to waive training requirements. (d) When considering subsequent loan actions, previous training requirements that have not yet been satisfied may be waived by the Agency should the borrower submit satisfactory evidence in accordance with paragraph (b) of this section. | |||
| 7:7:7.1.1.4.15.11.9.4 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | K | Subpart K—Borrower Training and Training Vendor Requirements | § 764.454 Actions that an applicant must take when training is required. | FSA | (a) Deadline for completion of training. (1) If the Agency requires an applicant to complete training, at loan closing the applicant must agree in writing to complete all required training within 2 years. (2) The Agency will grant a one-year extension to complete training if the applicant is unable to complete training within the 2-year period due to circumstances beyond the applicant's control. (3) The Agency will grant an extension longer than one year for extraordinary circumstances as determined by the Agency. (4) An applicant who does not complete the required training within the specified time-period will be ineligible for additional direct FLP loans until the training is completed. (b) Arranging training with a vendor. The applicant must select and contact an Agency approved vendor and make all arrangements to begin training. (c) Payment of training fees. (1) The applicant is responsible for the cost of training and must include training fees in the farm operating plan as a farm operating expense. (2) The payment of training fees is an authorized use of OL funds. (3) The Agency is not a party to fee or other agreements between the applicant and the vendor. (d) Evaluation of a vendor. Upon completion of the required training, the applicant will complete an evaluation of the course and submit it to the vendor. The vendor will forward the completed evaluation forms to the Agency. | ||||
| 7:7:7.1.1.4.15.11.9.5 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | K | Subpart K—Borrower Training and Training Vendor Requirements | § 764.455 Potential training vendors. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 89 FR 65041, Aug. 8, 2024] | The Agency will contract for training services with State or private providers of financial management training services. | |||
| 7:7:7.1.1.4.15.11.9.6 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | K | Subpart K—Borrower Training and Training Vendor Requirements | § 764.456 Applying to be a vendor. | FSA | (a) A vendor for borrower training services must apply to the Agency for approval. (b) The vendor application must include: (1) A sample of the course materials and a description of the vendor's training methods; (2) Specific training objectives for each section of the course; (3) A detailed course agenda specifying the topics to be covered, the time devoted to each topic, and the number of sessions to be attended; (4) A list of instructors and their qualifications; (5) The criteria by which additional instructors will be selected; (6) The proposed locations where training will take place; (7) The cost per participant, including cost for additional members of a farming operation; (8) The minimum and maximum class size; (9) The vendor's experience in developing and administering training to farmers; (10) The monitoring and quality control methods the vendor will use; (11) The policy on allowing Agency employees to attend the course for monitoring purposes; (12) A plan of how the needs of applicants with physical, mental, or learning disabilities will be met; and (13) A plan of how the needs of applicants who do not speak English as their primary language will be met. | ||||
| 7:7:7.1.1.4.15.11.9.7 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | K | Subpart K—Borrower Training and Training Vendor Requirements | § 764.457 Vendor requirements. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 89 FR 65041, Aug. 8, 2024] | (a) Minimum experience. The vendor must demonstrate a minimum of 3 years of experience in conducting training courses or teaching the subject matter. (b) Training objectives. The courses provided by a vendor must enable the applicant to accomplish one or more of the following objectives: (1) Describe the specific goals of the farming operation, any changes required to attain the goals, and outline how these changes will occur using present and projected cash flow budgets; (2) Maintain and use a financial management information system to make financial decisions; (3) Understand and use an income statement; (4) Understand and use a balance sheet; and (5) Understand and use a cash flow budget. (c) Curriculum. At least one of the following subjects must be covered: (1) Business planning courses, covering general goal setting, risk management, and planning; or (2) Financial management courses, covering all aspects of farm accounting and focusing on integrating accounting elements into a financial management system. (d) Instructor qualifications. All instructors must have: (1) Sufficient knowledge of the material and experience in adult education; (2) A bachelor's degree or comparable experience in the subject area to be taught; and (3) A minimum of 3 years experience in conducting training courses or teaching. | |||
| 7:7:7.1.1.4.15.11.9.8 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | K | Subpart K—Borrower Training and Training Vendor Requirements | § 764.458 Vendor approval. | FSA | (a) Agreement to conduct training. (1) Upon approval, the vendor must sign an agreement to conduct training for the Agency's borrowers. (2) The agreement to conduct training is valid for 3 years. (3) Any changes in curriculum, instructor, or cost require prior approval by the Agency. (4) The vendor may revoke the agreement by giving the Agency a written 30-day notice. (5) The Agency may revoke the agreement if the vendor does not comply with the responsibilities listed in the agreement by giving the vendor a written 30-day notice. (b) Renewal of agreement to conduct training. (1) To renew the agreement to conduct training, the vendor must submit in writing to the Agency: (i) A request to renew the agreement; (ii) Any changes in curricula, instructor, or cost; and (iii) Documentation that the vendor is providing effective training. (2) The Agency will review renewal requests in accordance with § 764.457. | ||||
| 7:7:7.1.1.4.15.11.9.9 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | K | Subpart K—Borrower Training and Training Vendor Requirements | § 764.459 Evaluation of borrower progress. | FSA | (a) The vendor must provide the Agency with a periodic progress report for each borrower enrolled in training in accordance with the agreement to complete training. The reports will indicate whether the borrower is attending sessions, completing the training program, and demonstrating an understanding of the course material. (b) Upon borrower completion of the training, the vendor must provide the Agency with an evaluation of the borrower's knowledge of the course material and assign a score. The following table lists the possible scores, the criteria used to assign each score, and Agency consideration of each score: | ||||
| 7:7:7.1.1.4.15.2.9.1 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | B | Subpart B—Loan Application Process | § 764.51 Loan application. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 75 FR 54015, Sept. 3, 2010; 76 FR 75434, Dec. 2, 2011; 77 FR 15938, Mar. 19, 2012; 78 FR 3835, Jan. 17, 2013; 79 FR 60744, Oct. 8, 2014; 81 FR 3292, Jan. 21, 2016; 81 FR 51284, Aug. 3, 2016; 89 FR 65039, Aug. 8, 2024] | (a) A loan application must be submitted in the name of the actual operator of the farm. Two or more applicants applying jointly will be considered an entity applicant. The Agency will consider tax filing status and other business dealings as indicators of the operator of the farm. (b) A complete loan application, except as provided in paragraphs (c) through (f) of this section, will include: (1) The completed Agency application form; (2) If the applicant is an entity: (i) A complete list of entity members showing the address, citizenship, principal occupation, and the number of shares and percentage of ownership or stock held in the entity by each member, or the percentage of interest in the entity held by each member; (ii) A current financial statement from each member of the entity; (iii) A current financial statement from the entity itself; (iv) A copy of the entity's charter or any entity agreement, any articles of incorporation and bylaws, any certificate or evidence of current registration (good standing), and a resolution adopted by the Board of Directors or entity members authorizing specified officers of the entity to apply for and obtain the desired loan and execute required debt, security and other loan instruments and agreements; (v) In the form of married couples applying as a joint operation, items (i) and (iv) will not be required. The Agency may request copies of the marriage license, prenuptial agreement or similar documents as needed to verify loan eligibility and security. Items (ii) and (iii) are only required to the extent needed to show the individual and joint finances of the husband and wife without duplication. (3) A written description of the applicant's farm training and experience, including each entity member who will be involved in managing or operating the farm. Farm experience of the applicant, without regard to any lapse of time between the farm experience and the new application, may be included in the applicant's written description. If farm experience occurred more th… | |||
| 7:7:7.1.1.4.15.2.9.2 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | B | Subpart B—Loan Application Process | § 764.52 Processing an incomplete application. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 86 FR 43391, Aug. 9, 2021] | (a) Within 7 calendar days of receipt of an incomplete application, the Agency will provide the applicant written notice of any additional information which must be provided. The applicant must provide the additional information within 15 calendar days of the date of this notice. (b) If the additional information is not received, the Agency will provide written notice that the application will be withdrawn if the information is not received within 15 calendar days of the date of this second notice. | |||
| 7:7:7.1.1.4.15.2.9.3 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | B | Subpart B—Loan Application Process | § 764.53 Processing the complete application. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 75 FR 54015, Sept. 3, 2010] | Upon receiving a complete loan application, the Agency will: (a) Consider the loan application in the order received, based on the date the application was determined to be complete. (b) Provide written notice to the applicant that the application is complete. (c) Within 60 calendar days after receiving a complete loan application, the Agency will complete the processing of the loan request and notify the applicant of the decision reached, and the reason for any disapproval. (d) Except for CL requests, if based on the Agency's review of the application, it appears the applicant's credit needs could be met through the guaranteed loan program, the Agency will assist the applicant in securing guaranteed loan assistance under the market placement program as specified in § 762.110(h) of this chapter. (e) In the absence of funds for a direct loan, the Agency will keep an approved loan application on file until funding is available. At least annually, the Agency will contact the applicant to determine if the Agency should retain the application or if the applicant wants the application withdrawn. (f) If funding becomes available, the Agency will resume processing of approved loans in accordance with this part. | |||
| 7:7:7.1.1.4.15.2.9.4 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | B | Subpart B—Loan Application Process | § 764.54 Preferences when there is limited funding. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 86 FR 43391, Aug. 9, 2021] | (a) First priority. When there is a shortage of loan funds, approved applications will be funded in the order of the date the application was received, whether or not complete. (b) Secondary priorities. If two or more applications were received on the same date, the Agency will give preference to: (1) First, an applicant who is a veteran of any war; (2) Second, an applicant who is not a veteran, but: (i) Has a dependent family; (ii) Is able to make a down payment; or (iii) Owns livestock and farm implements necessary to farm successfully. (3) Third, to other eligible applicants. | |||
| 7:7:7.1.1.4.15.2.9.5 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | B | Subpart B—Loan Application Process | §§ 764.55-764.100 [Reserved] | FSA | |||||
| 7:7:7.1.1.4.15.3.9.1 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | C | Subpart C—Requirements for All Direct Program Loans | § 764.101 General eligibility requirements. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 75 FR 54015, Sept. 3, 2010; 76 FR 75434, Dec. 2, 2011; 78 FR 3835, Jan. 17, 2013; 79 FR 60744, Oct. 8, 2014; 81 FR 3293, Jan. 21, 2016; 81 FR 10063, Feb. 29, 2016; 86 FR 43391, Aug. 9, 2021; 89 FR 65039, Aug. 8, 2024] | The following requirements must be met unless otherwise provided in the eligibility requirements for the particular type of loan. (a) Controlled substances. The applicant, and anyone who will sign the promissory note, must not be ineligible for loans as a result of a conviction for controlled substances according to 7 CFR part 718 of this chapter. (b) Legal capacity. The applicant, and anyone who will sign the promissory note, must possess the legal capacity to incur the obligation of the loan. A Youth loan applicant will incur full personal liability upon execution of the promissory note without regard to the applicant's minority status. (c) Citizenship. The applicant, and anyone who will sign the promissory note, must be a citizen of the United States, United States non-citizen national, or a qualified alien under applicable Federal immigration laws. (d) Credit history. The applicant, and all entity members in the case of an entity, must have acceptable credit history demonstrated by debt repayment. (1) As part of the credit history, the Agency will determine whether the applicant, and all entity members in the case of an entity, will carry out the terms and conditions of the loan and deal with the Agency in good faith. In making this determination, the Agency may examine whether the applicant, and all entity members in the case of an entity, has properly fulfilled its obligations to other parties, including other agencies of the Federal Government. (2) When the applicant, or an entity member in the case of an entity, caused the Agency a loss by receiving debt forgiveness, the applicant may be ineligible for assistance in accordance with eligibility requirements for the specific loan type. If the debt forgiveness is cured by repayment of the Agency's loss, the Agency may still consider the debt forgiveness in determining the applicant's credit worthiness. (3) A history of failures to repay past debts as they came due will demonstrate unacceptable credit history when the ability to repay was withi… | |||
| 7:7:7.1.1.4.15.3.9.2 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | C | Subpart C—Requirements for All Direct Program Loans | § 764.102 General limitations. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 75 FR 54015, Sept. 3, 2010; 76 FR 75434, Dec. 2, 2011] | (a) Limitations specific to each loan program are contained in subparts D through I of this part. (b) The total principal balance owed to the Agency at any one time by the applicant, or any one who will sign the promissory note, cannot exceed the limits established in § 761.8 of this chapter. (c) The funds from the FLP loan must be used for farming operations located in the United States. (d) The Agency will not make a loan if the proceeds will be used: (1) For any purpose that contributes to excessive erosion of highly erodible land, or to the conversion of wetlands; (2) To drain, dredge, fill, level, or otherwise manipulate a wetland; or (3) To engage in any activity that results in impairing or reducing the flow, circulation, or reach of water, except in the case of activity related to the maintenance of previously converted wetlands as defined in the Food Security Act of 1985. (e) Any construction financed by the Agency must comply with the standards established in § 761.10 of this chapter. (f) Loan funds will not be used to establish or support a non-eligible enterprise, even if the non-eligible enterprise contributes to the farm. Notwithstanding this limitation, an EM loan may cover qualified equine losses as specified in subpart I of this part. | |||
| 7:7:7.1.1.4.15.3.9.3 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | C | Subpart C—Requirements for All Direct Program Loans | § 764.103 General security requirements. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 73 FR 74345, Dec. 8, 2008; 75 FR 54015, Sept. 3, 2010; 78 FR 3835, Jan. 17, 2013; 86 FR 43391, Aug. 9, 2021; 89 FR 65039, Aug. 8, 2024] | (a) Security requirements specific to each loan program are outlined in subparts D through I of this part. (b) All loans must be secured by assets having a security value of at least 100 percent of the loan amount, except for EM loans as provided in subpart I of this part. If the applicant's assets do not provide adequate security, the Agency may accept: (1) A pledge of security from a third party; or (2) Interests in property not owned by the applicant (such as leases that provide a mortgageable value, water rights, easements, mineral rights, and royalties). (c) An additional amount of security will be required, if available, to reach a 125 percent security margin. Total loan security in excess of what is needed to achieve a security margin of 125 percent will only be taken when it is not practicable to separate the security, or if necessary to satisfy the requirements of § 764.254(b)(2)(i). Loans that do not require additional security are down payment loans, MLs, youth loans, and FOs for the purchase of a farm where the applicant provides a cash down payment equal to 5 percent or greater of the purchase price. Non-real estate assets will not be taken as additional security for any loan where real estate serves as adequate security. (d) The Agency will choose the best security available when there are several alternatives that meet the Agency's security requirements. (e) The Agency will take a lien on all assets that are not essential to the farming operation and are not being converted to cash to reduce the loan amount when each such asset, or aggregate value of like assets (such as stocks), has a value in excess of $15,000. The value of this security is not included in the Agency's additional security requirement stated in paragraph (c) of this section. This requirement does not apply to downpayment loans, CL, ML, or youth loans. | |||
| 7:7:7.1.1.4.15.3.9.4 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | C | Subpart C—Requirements for All Direct Program Loans | § 764.104 General real estate security requirements. | FSA | (a) Agency lien position requirements. If real estate is pledged as security for a loan, the Agency must obtain a first lien, if available. When a first lien is not available, the Agency may take a junior lien under the following conditions: (1) The prior lien does not contain any provisions that may jeopardize the Agency's interest or the applicant's ability to repay the FLP loan; (2) Prior lienholders agree to notify the Agency prior to foreclosure; (3) The applicant must agree not to increase an existing prior lien without the written consent of the Agency; and (4) Equity in the collateral exists. (b) Real estate held under a purchase contract. If the real estate offered as security is held under a recorded purchase contract: (1) The applicant must provide a security interest in the real estate; (2) The applicant and the purchase contract holder must agree in writing that any insurance proceeds received for real estate losses will be used only for one or more of the following purposes: (i) To replace or repair the damaged real estate improvements which are essential to the farming operation; (ii) To make other essential real estate improvements; or (iii) To pay any prior real estate lien, including the purchase contract. (3) The purchase contract must provide the applicant with possession, control and beneficial use of the property, and entitle the applicant to marketable title upon fulfillment of the contract terms. (4) The purchase contract must not: (i) Be subject to summary cancellation upon default; (ii) Contain provisions which jeopardize the Agency's security position or the applicant's ability to repay the loan. (5) The purchase contract holder must agree in writing to: (i) Not sell or voluntarily transfer their interest without prior written consent of the Agency; (ii) Not encumber or cause any liens to be levied against the property; (iii) Not take any action to accelerate, forfeit, or foreclose the applicant's interest in the security property until a specified period of time a… | ||||
| 7:7:7.1.1.4.15.3.9.5 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | C | Subpart C—Requirements for All Direct Program Loans | § 764.105 General chattel security requirements. | FSA | The same chattel may be pledged as security for more than one direct or guaranteed loan. | ||||
| 7:7:7.1.1.4.15.3.9.6 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | C | Subpart C—Requirements for All Direct Program Loans | § 764.106 Exceptions to security requirements. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 81 FR 51284, Aug. 3, 2016; 89 FR 65040, Aug. 8, 2024] | Notwithstanding any other provision of this part, the Agency will not take a security interest: (a) When adequate security is otherwise available and the lien will prevent the applicant from obtaining credit from other sources; (b) When the property could have significant environmental problems or costs as described in part 799 of this chapter; (c) When the Agency cannot obtain a valid lien; (d) Unless the applicant provides a written request for an exemption, when the property includes the primary personal residence and appurtenances of the applicant or any entity member(s) and: (1) They are located on a separate parcel of up to the greater of 10 acres or the minimum size that meets all State and local requirements for a division into a separate legal lot; and (2) The security requirements of § 764.103(b) can be satisfied without the use of the primary personal residence and appurtenances; (e) When the property is subsistence livestock, cash, working capital accounts the applicant uses for the farming operation, retirement accounts, education savings accounts, personal vehicles necessary for family living, household contents, or small equipment such as hand tools and lawn mowers; or (f) On marginal land and timber that secures an outstanding ST loan. | |||
| 7:7:7.1.1.4.15.3.9.7 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | C | Subpart C—Requirements for All Direct Program Loans | § 764.107 General appraisal requirements. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 81 FR 3293, Jan. 21, 2016] | (a) Establishing value for real estate. The value of real estate will be established by an appraisal completed in accordance with § 761.7 of this chapter, except that for MLs made for FO purposes, the appraisal requirement may be satisfied by an evaluation by an authorized agency official that establishes the value of the real estate. (b) Establishing value for chattels. The value of chattels will be established as follows: (1) Annual production. The security value of annual livestock and crop production is presumed to be 100 percent of the amount loaned for annual operating and family living expenses, as outlined in the approved farm operating plan. (2) Livestock and equipment. The value of livestock and equipment will be established by an appraisal completed in accordance with § 761.7 of this chapter. | |||
| 7:7:7.1.1.4.15.3.9.8 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | C | Subpart C—Requirements for All Direct Program Loans | § 764.108 General insurance requirements. | FSA | The applicant must obtain and maintain insurance, equal to the lesser of the value of the security at the time of loan closing or the principal of all FLP and non-FLP loans secured by the property, subject to the following: (a) All security, except growing crops, must be covered by hazard insurance if it is readily available (sold by insurance agents in the applicant's normal trade area) and insurance premiums do not exceed the benefit. The Agency must be listed as loss payee for the insurance indemnity payment or as a beneficiary in the mortgagee loss payable clause. (b) Real estate security located in flood or mudslide prone areas must be covered by flood or mudslide insurance. The Agency must be listed as a beneficiary in the mortgagee loss payable clause. (c) Growing crops used to provide adequate security must be covered by crop insurance if such insurance is available. The Agency must be listed as loss payee for the insurance indemnity payment. (d) Prior to closing the loan, the applicant must have obtained at least the catastrophic risk protection level of crop insurance coverage for each crop which is a basic part of the applicant's total operation, if such insurance is available, unless the applicant executes a written waiver of any emergency crop loss assistance with respect to such crop. The applicant must execute an assignment of indemnity in favor of the Agency for this coverage. | ||||
| 7:7:7.1.1.4.15.3.9.9 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | C | Subpart C—Requirements for All Direct Program Loans | §§ 764.109-764.150 [Reserved] | FSA | |||||
| 7:7:7.1.1.4.15.4.9.1 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | D | Subpart D—Farm Ownership Loan Program | § 764.151 Farm Ownership loan uses. | FSA | FO loan funds may only be used to: (a) Acquire or enlarge a farm or make a down payment on a farm; (b) Make capital improvements to a farm owned by the applicant, for construction, purchase or improvement of farm dwellings, service buildings or other facilities and improvements essential to the farming operation. In the case of leased property, the applicant must have a lease to ensure use of the improvement over its useful life or to ensure that the applicant receives compensation for any remaining economic life upon termination of the lease; (c) Promote soil and water conservation and protection; (d) Pay loan closing costs; (e) Refinance a bridge loan if the following conditions are met: (1) The applicant obtained the loan to be refinanced to purchase a farm after a direct FO was approved; (2) Direct FO funds were not available to fund the loan at the time of approval; (3) The loan to be refinanced is temporary financing; and (4) The loan was made by a commercial or cooperative lender. | ||||
| 7:7:7.1.1.4.15.4.9.2 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | D | Subpart D—Farm Ownership Loan Program | § 764.152 General eligibility requirements. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 79 FR 60744, Oct. 8, 2014; 81 FR 3293, Jan. 21, 2016; 86 FR 43391, Aug. 9, 2021; 87 FR 13124, Mar. 9, 2022; 89 FR 65040, Aug. 8, 2024] | The applicant: (a) Must comply with the general eligibility requirements established at § 764.101; (b) And anyone who will sign the promissory note, must not have received debt forgiveness from the Agency on any direct or guaranteed loan; (c) Must be the owner-operator of the farm financed with Agency funds after the loan is closed. Ownership of the family farm operation and farm real estate may be held either directly in the individual's name or indirectly through interest in a legal entity. In the case of an entity: (1) The entity is controlled by farmers engaged primarily and directly in farming in the United States, after the loan is made; (2) An ownership entity must be authorized to own a farm in the state or states in which the farm is located. An operating entity must be authorized to operate a farm in the state or states in which the farm is located. (3) If the entity members holding majority interest are: (i) Related by blood or marriage, at least one member of the entity must operate the family farm and at least one member of the entity or the entity must own the farm; or, (ii) Not related by blood or marriage, the entity members holding at least 50 percent interest must operate the family farm and the entity members holding at least 50 percent interest or the entity must own the farm. (4) If the entity is an operator only entity, the individuals that own the farm (real estate) must own at least 50 percent of the family farm (operating entity). (d) And in the case of an entity, at least one member who will be the operator of the family farm, must have participated in the business operations of a farm for at least 3 years out of the 10 years prior to the date the application is submitted. (1) The following experiences can substitute for up to 2 of the 3 years: (i) Not less than 16 credit hours of post-secondary education in an agriculture-related field; (ii) Successful completion of a farm management curriculum offered by a cooperative extension service, community college, adult vocational … | |||
| 7:7:7.1.1.4.15.4.9.3 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | D | Subpart D—Farm Ownership Loan Program | § 764.153 Limitations. | FSA | The applicant must: (a) Comply with the general limitations established at § 764.102; (b) Have dwellings and other buildings necessary for the planned operation of the farm available for use after the loan is made. | ||||
| 7:7:7.1.1.4.15.4.9.4 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | D | Subpart D—Farm Ownership Loan Program | § 764.154 Rates and terms. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 79 FR 78693, Dec. 31, 2014; 81 FR 3293, Jan. 21, 2016; 89 FR 65040, Aug. 8, 2024] | (a) Rates. (1) The interest rate is the Agency's Direct Farm Ownership rate, available in each Agency office. (2) The limited resource Farm Ownership interest rate is available to applicants who are unable to develop a feasible plan at regular interest rates. (3) If the FO loan is part of a joint financing arrangement and the amount of the Agency's loan does not exceed 50 percent of the total amount financed, the interest rate charged will be the greater of the following: (i) The Agency's Direct Farm Ownership rate, available in each Agency office, minus 2 percent; or (ii) 2.5 percent. (4) The interest rate charged will be the lower of the rate in effect at the time of loan approval or loan closing. (b) Terms. The repayment terms are: (1) The standard repayment term of an FO will be equal to the useful life of the security or 40 years, whichever is less. Repayment terms less than the standard term must be requested by the applicant in writing. In no event will the term be more than 40 years from the date of the note. Repayment schedules may include equal installments, or unequal installments if needed to establish a new enterprise, develop a farm, recover from a disaster or economic reversal, or reasonably increase cash flow margin to increase working capital reserves and savings, including reasonable savings for retirement and education. Notwithstanding any other provision of this section, repayment schedules must be designed to ensure the loan is fully secured for the life of the loan. (2) The first installment of an FO will be an interest-only installment scheduled 12 months from the date of loan closing. An alternative repayment agreement that schedules the first installment sooner than 12 months from the date of closing, or in an amount greater than interest-only, may be provided upon written request from the applicant, or if the Agency determines it necessary to ensure the loan is fully secured for the life of the loan. (3) The minimum scheduled installments for the first 3 years of an FO must … | |||
| 7:7:7.1.1.4.15.4.9.5 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | D | Subpart D—Farm Ownership Loan Program | § 764.155 Security requirements. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 81 FR 3293, Jan. 21, 2016] | An FO loan must be secured: (a) In accordance with §§ 764.103 through 764.106; (b) At a minimum, by the real estate being purchased or improved. (1) An ML made for FO purposes, may be secured only by the real estate being purchased or improved, as long as its value is at least 100 percent of the loan amount. (2) [Reserved] | |||
| 7:7:7.1.1.4.15.4.9.6 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | D | Subpart D—Farm Ownership Loan Program | §§ 764.156-764.200 [Reserved] | FSA | |||||
| 7:7:7.1.1.4.15.5.9.1 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | E | Subpart E—Downpayment Loan Program | § 764.201 Down payment loan uses. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 73 FR 74345, Dec. 8, 2008; 86 FR 43392, Aug. 9, 2021; 87 FR 13124, Mar. 9, 2022] | Down payment loan funds may be used to partially finance the purchase of a family farm by an eligible beginning farmer, socially disadvantaged farmer, or veteran farmer farmer. | |||
| 7:7:7.1.1.4.15.5.9.2 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | E | Subpart E—Downpayment Loan Program | § 764.202 Eligibility requirements. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 73 FR 74345, Dec. 8, 2008; 87 FR 13124, Mar. 9, 2022] | The applicant must: (a) Comply with the general eligibility requirements established at § 764.101 and the FO eligibility requirements of § 764.152; and (b) Be a beginning farmer, socially disadvantaged farmer, or veteran farmer. | |||
| 7:7:7.1.1.4.15.5.9.3 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | E | Subpart E—Downpayment Loan Program | § 764.203 Limitations. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 73 FR 74345, Dec. 8, 2008; 79 FR 78693, Dec. 31, 2014; 81 FR 3293, Jan. 21, 2016; 86 FR 43392, Aug. 9, 2021] | (a) The applicant must: (1) Comply with the general limitations established at § 764.102; and (2) Provide a minimum down payment of 5 percent of the purchase price of the farm. (b) Down payment loans will not exceed 45 percent of the lesser of: (1) The purchase price, (2) The appraised value of the farm to be acquired, or (3) $667,000; subject to the direct FO dollar limit specified in 7 CFR 761.8(a)(1)(i). (c) Down payment loans made as an ML for FO purposes may not exceed $50,000. (d) Financing provided by the Agency and all other creditors must not exceed 95 percent of the purchase price. Financing provided by eligible lenders may be guaranteed by the Agency under part 762 of this chapter. | |||
| 7:7:7.1.1.4.15.5.9.4 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | E | Subpart E—Downpayment Loan Program | § 764.204 Rates and terms. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 73 FR 74345, Dec. 8, 2008; 86 FR 43392, Aug. 9, 2021] | (a) Rates. The interest rate for Down payment loans will be the regular direct FO rate minus 4 percent, but in no case less than 1.5 percent. (b) Terms. (1) The Agency schedules repayment of Down payment loans in equal, annual installments over a term not to exceed 20 years. (2) The non-Agency financing must have an amortization period of at least 30 years and cannot have a balloon payment due within the first 20 years of the loan. | |||
| 7:7:7.1.1.4.15.5.9.5 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | E | Subpart E—Downpayment Loan Program | § 764.205 Security requirements. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 73 FR 74345, Dec. 8, 2008; 86 FR 43392, Aug. 9, 2021] | A Down payment loan must: (a) Be secured in accordance with §§ 764.103 through 764.106; (b) Be secured by a lien on the property being acquired with the loan funds and junior only to the party financing the balance of the purchase price. | |||
| 7:7:7.1.1.4.15.5.9.6 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | E | Subpart E—Downpayment Loan Program | §§ 764.206-764.230 [Reserved] | FSA | |||||
| 7:7:7.1.1.4.15.6.9.1 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | F | Subpart F—Conservation Loan Program | § 764.231 Conservation loan uses. | FSA | [75 FR 54015, Sept. 3, 2010, as amended at 77 FR 15938, Mar. 19, 2012] | (a) CL funds may be used for any conservation activities included in a conservation or Forestry Service Stewardship Management Plan, including but not limited to: (1) The installation of conservation structures to address soil, water, and related resources; (2) The establishment of forest cover for sustained yield timber management, erosion control, or shelter belt purposes; (3) The installation of water conservation measures; (4) The installation of waste management systems; (5) The establishment or improvement of permanent pasture; and (6) Other purposes including the adoption of any other emerging or existing conservation practices, techniques, or technologies. (b) [Reserved] | |||
| 7:7:7.1.1.4.15.6.9.2 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | F | Subpart F—Conservation Loan Program | § 764.232 Eligibility requirements. | FSA | (a) The applicant: (1) Must comply with general eligibility requirements specified in § 764.101 except paragraphs (e) and (k) of that section; (2) And anyone who will sign the promissory note, must not have received debt forgiveness from the Agency on any direct or guaranteed loan; and (3) Must be the owner-operator or tenant-operator of a farm and be engaged in agricultural production after the time of loan is closed. In the case of an entity: (i) The entity is controlled by farmers engaged primarily and directly in farming in the United States; (ii) The entity must be authorized to operate a farm in the State in which the farm is located. (b) [Reserved] | ||||
| 7:7:7.1.1.4.15.6.9.3 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | F | Subpart F—Conservation Loan Program | § 764.233 Limitations. | FSA | (a) The applicant must comply with the general limitations specified in § 764.102 except § 764.102(f), which does not apply to applicants for the CL Program. (b) The applicant must agree to repay any duplicative financial benefits or assistance to CL. | ||||
| 7:7:7.1.1.4.15.6.9.4 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | F | Subpart F—Conservation Loan Program | § 764.234 Rates and terms. | FSA | (a) Rates. The interest rate: (1) Will be the Agency's Direct Farm Ownership rate, available in each Agency office. (2) Charged will be the lower rate in effect either at the time of loan approval or loan closing. (b) Terms. The following terms apply to CLs: (1) The Agency schedules repayment of a CL based on the useful life of the security. (2) The maximum term for loans secured by chattels only will not exceed 7 years from the date of the note. (3) In no event will the term of the loan exceed 20 years from the date of the note. | ||||
| 7:7:7.1.1.4.15.6.9.5 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | F | Subpart F—Conservation Loan Program | § 764.235 Security requirements. | FSA | [77 FR 15938, Mar. 19, 2012] | (a) The loan must be secured in accordance with requirements established in §§ 764.103 through 764.106. (b) Loans to purchase chattels will be secured by a first lien on chattels purchased with loan funds. Real estate may be taken as additional security if needed. (c) Loans of $25,000 of less for real estate purposes will be secured in the following order of priority: (1) By a lien on chattels determined acceptable by the Agency, and then (2) By a lien on real estate, if available and necessary. When real estate is taken as security a certification of ownership in real estate is required. Certification of ownership may be in the form of an affidavit that is signed by the applicant, names all of the record owners of the real estate in question and lists the balances due on all known debts against the real estate. Whenever the Agency is uncertain of the record owner or debts against the real estate security, a tile search is required. (d) Loans greater than $25,000 for real estate purposes will be secured in the following order of priority: (1) By a lien on real estate, if available, and then (2) By a lien on chattels, if needed and determined acceptable by the Agency. (e) For loans greater than $25,000 title clearance is required when real estate is taken as security. | |||
| 7:7:7.1.1.4.15.6.9.6 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | F | Subpart F—Conservation Loan Program | §§ 764.236-764.250 [Reserved] | FSA | |||||
| 7:7:7.1.1.4.15.7.9.1 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | G | Subpart G—Operating Loan Program | § 764.251 Operating loan uses. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 78 FR 3835, Jan. 17, 2013; 81 FR 3293, Jan. 21, 2016; 89 FR 65040, Aug. 8, 2024] | (a) Except as provided in paragraph (b), OL and ML used for OL purposes loan funds may only be used for: (1) Costs associated with reorganizing a farm to improve its profitability; (2) Purchase of livestock, including poultry, farm equipment or fixtures, quotas and bases, and cooperative stock for credit, production, processing or marketing purposes; (3) Farm operating expenses, including, but not limited to, feed, seed, fertilizer, pesticides, farm supplies, repairs and improvements which are to be expensed, cash rent and family living expenses; (4) Scheduled principal and interest payments on term debt provided the debt is for authorized FO or OL purposes; (5) Other farm needs; (6) Costs associated with land and water development, use, or conservation; (7) Loan closing costs; (8) Costs associated with Federal or State-approved standards under the Occupational Safety and Health Act of 1970 (29 U.S.C. 655 and 667) if the applicant can show that compliance or non-compliance with the standards will cause substantial economic injury; (9) Borrower training costs required or recommended by the Agency; (10) Refinancing farm-related debts other than real estate to improve the farm's profitability provided the applicant has refinanced direct or guaranteed OL loans four times or fewer and one of the following conditions is met: (i) A designated or declared disaster caused the need for refinancing; or (ii) The debts to be refinanced are owed to a creditor other than the USDA; (11) Costs for minor real estate repairs or improvements, provided the loan is made primarily for agricultural purposes and can be repaid within 7 years. In the case of leased property, the applicant must have a lease to ensure use of the improvement over its useful life or to ensure that the applicant receives compensation for any remaining economic life upon termination of the lease. (b) [Reserved] | |||
| 7:7:7.1.1.4.15.7.9.2 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | G | Subpart G—Operating Loan Program | § 764.252 Eligibility requirements. | FSA | [79 FR 78693, Dec. 31, 2014] | (a) The applicant must comply with the general eligibility requirements established in § 764.101. (b) The applicant and anyone who will sign the promissory note, except as provided in paragraph (c) of this section, must not have received debt forgiveness from the Agency on any direct or guaranteed loan. (c) The applicant and anyone who will sign the promissory note, may receive direct OL loans to pay annual farm operating and family living expenses, provided that the applicant meets all other applicable requirements under this part, if the applicant: (1) Received a write-down under section 353 of the Act; (2) Is current on payments under a confirmed reorganization plan under Chapter 11, 12, or 13 of Title 11 of the United States Code; or (3) Received debt forgiveness on not more than one occasion after April 4, 1996, resulting directly and primarily from a Presidentially-designated emergency for the county or contiguous county in which the applicant operates. Only applicants who were current on all existing direct and guaranteed FLP loans prior to the beginning date of the incidence period of a Presidentially-designated emergency and received debt forgiveness on that debt within 3 years after the designation of such emergency meet this exception. (d) In the case of an entity applicant, the entity must be: (1) Controlled by farmers engaged primarily and directly in farming in the United States; and (2) Authorized to operate the farm in the State in which the farm is located. (e) The applicant and anyone who will sign the promissory note, may close an OL in no more than 7 calendar years, either as an individual or as a member of an entity, except as provided in paragraphs (e)(1) through (4) of this section. The years may be consecutive or nonconsecutive, and there is no limit on the number of OLs closed in a year. Microloans made to a beginning farmer or a veteran farmer are not counted toward this limitation. Youth loans are not counted toward this limitation. The following exceptions apply: (1) This lim… | |||
| 7:7:7.1.1.4.15.7.9.3 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | G | Subpart G—Operating Loan Program | § 764.253 Limitations. | FSA | The applicant must comply with the general limitations established at § 764.102. | ||||
| 7:7:7.1.1.4.15.7.9.4 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | G | Subpart G—Operating Loan Program | § 764.254 Rates and terms. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 79 FR 78694, Dec. 31, 2014; 86 FR 43392, Aug. 9, 2021; 89 FR 65040, Aug. 8, 2024] | (a) Rates. (1) The interest rate is the Agency's Direct Operating Loan rate, available in each Agency office. (2) The limited resource Operating Loan interest rate is available to applicants who are unable to develop a feasible plan at regular interest rates. (3) The interest rate charged will be the lower rate in effect at the time of loan approval or loan closing. (4) The Agency's Direct ML-OL interest rate on an ML to a beginning farmer or veteran farmer is available in each Agency office. The interest rate will be the lower of the regular direct OL interest rate in effect at the time of loan approval or loan closing, or 5 percent. (b) Terms. (1) The Agency schedules repayment of OL loans made for annual farm operating and family living expenses when planned income is projected to be available. (i) The term of the loan may not exceed 24 months from the date of the note, except as provided in paragraph (b)(1)(ii) of this section. (ii) The term of the loan may exceed 24 months in unusual situations such as establishing a new enterprise, developing a farm, purchasing feed while crops are being established, marketing plans, or recovery from a disaster or economic reverse. In no event will the term of the loan exceed 7 years from the date of the note. Crops and livestock produced for sale will not be considered adequate security for such loans. (2) The standard repayment term of all other OLs must be equal to the useful life of the security or 7 years, whichever is less. Repayment terms less than the standard term must be requested by the applicant in writing. In no event will the term of the loan exceed 7 years from the date of the note. Repayment schedules may include equal installments, or unequal or balloon installments if needed to establish a new enterprise, develop a farm, recover from a disaster or economic reversal, or reasonably increase cash flow margin to increase working capital reserves and savings, including reasonable savings for retirement and education. Notwithstanding any other provisi… | |||
| 7:7:7.1.1.4.15.7.9.5 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | G | Subpart G—Operating Loan Program | § 764.255 Security requirements. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 78 FR 3835, Jan. 17, 2013; 81 FR 3293, Jan. 21, 2016; 89 FR 65041, Aug. 8, 2024] | An OL loan must be secured: (a) In accordance with §§ 764.103 through 764.106. (b) Except for MLs or OLs made for the purpose of minor real estate repairs or improvements, by a: (1) First lien on all property or products acquired or produced with loan funds; (2) Lien of equal or higher position of that held by the creditor being refinanced with loan funds. (c) For MLs used for OL purposes: (1) For annual operating purposes, loans must be secured by a first lien on farm property or products having a security value of at least 100 percent of the loan amount. (2) For loans made for purposes other than annual operating purposes or for the purpose of minor real estate repairs or improvements, loans must be secured by a first lien on farm property or products purchased with loan funds and having a security value of at least 100 percent of the loan amount. (3) A lien on real estate is not required unless the value of the farm products, farm property, and other assets available to secure the loan is not at least equal to 100 percent of the loan amount. (4) Notwithstanding the provisions of paragraphs (c)(1), (c)(2), and (c)(3) of this section, FSA will not require a lien on a personal residence. (d) For OLs made for the purpose of minor real estate repairs or improvements, the Agency must obtain a lien on the real estate repaired or improved in accordance with the requirements of § 764.104, while also ensuring the provisions of § 764.103(b) requiring adequate security are satisfied. | |||
| 7:7:7.1.1.4.15.7.9.6 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | G | Subpart G—Operating Loan Program | §§ 764.256-764.300 [Reserved] | FSA | |||||
| 7:7:7.1.1.4.15.8.9.1 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | H | Subpart H—Youth Loan Program | § 764.301 Youth loan uses. | FSA | Youth loan funds may only be used to finance a modest, income-producing, agriculture-related, educational project while participating in 4-H, FFA, or a similar organization. | ||||
| 7:7:7.1.1.4.15.8.9.2 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | H | Subpart H—Youth Loan Program | § 764.302 Eligibility requirements. | FSA | [72 FR 63298, Nov. 8, 2007. Redesignated at 75 FR 54015, Sept. 3, 2010, as amended at 79 FR 78694, Dec. 31, 2014] | The applicant: (a) Must comply with the general eligibility requirements established at § 764.101(a) through (g); (b) And anyone who will sign the promissory note, must not have received debt forgiveness from the Agency on any direct or guaranteed loan; (c) Must be at least 10 but not yet 21 years of age at the time the loan is closed; (d) Must be recommended and continuously supervised by a project advisor, such as a 4-H Club advisor, a vocational teacher, a county extension agent, or other agriculture-related organizational sponsor; and (e) Must obtain a written recommendation and consent from a parent or guardian if the applicant has not reached the age of majority under state law. | |||
| 7:7:7.1.1.4.15.8.9.3 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | H | Subpart H—Youth Loan Program | § 764.303 Limitations. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 89 FR 65041, Aug. 8, 2024] | (a) The applicant must comply with the general limitations established at § 764.102. (b) The total principal balance owed by the applicant to the Agency on all Youth loans at any one time cannot exceed $10,000. | |||
| 7:7:7.1.1.4.15.8.9.4 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | H | Subpart H—Youth Loan Program | § 764.304 Rates and terms. | FSA | (a) Rates. (1) The interest rate is the Agency's Direct Operating Loan rate, available in each Agency office. (2) The limited resource Operating Loan interest rate is not available for Youth loans. (3) The interest rate charged will be the lower rate in effect at the time of loan approval or loan closing. (b) Terms. Youth loan terms are the same as for an OL established at § 764.254(b). | ||||
| 7:7:7.1.1.4.15.8.9.5 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | H | Subpart H—Youth Loan Program | § 764.305 Security requirements. | FSA | A first lien will be obtained on property or products acquired or produced with loan funds. | ||||
| 7:7:7.1.1.4.15.8.9.6 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | H | Subpart H—Youth Loan Program | §§ 764.306-764.350 [Reserved] | FSA | |||||
| 7:7:7.1.1.4.15.9.9.1 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | I | Subpart I—Emergency Loan Program | § 764.351 Emergency loan uses. | FSA | (a) Physical losses —(1) Real estate losses. EM loan funds for real estate physical losses may only be used to repair or replace essential property damaged or destroyed as a result of a disaster as follows: (i) For any FO purpose, as specified in § 764.151, except subparagraph (e) of that section; (ii) To establish a new site for farm dwelling and service buildings outside of a flood or mudslide area; and (iii) To replace land from the farm that was sold or conveyed, if such land is necessary for the farming operation to be effective. (2) Chattel losses. EM loan funds for chattel physical losses may only be used to repair or replace essential property damaged or destroyed as a result of a disaster as follows: (i) Purchase livestock, farm equipment, quotas and bases, and cooperative stock for credit, production, processing, or marketing purposes; (ii) Pay customary costs associated with obtaining and closing a loan that an applicant cannot pay from other sources (e.g., fees for legal, architectural, and other technical services, but not fees for agricultural management consultation, or preparation of Agency forms); (iii) Repair or replace household contents damaged in the disaster; (iv) Pay the costs to restore perennials, which produce an agricultural commodity, to the stage of development the damaged perennials had obtained prior to the disaster; (v) Pay essential family living and farm operating expenses, in the case of an operation that has suffered livestock losses not from breeding stock, or losses to stored crops held for sale; and (vi) Refinance farm-related debts other than real estate to improve farm profitability, if the applicant has refinanced direct or guaranteed loans four times or fewer and one of the following conditions is met: (A) A designated or declared disaster caused the need for refinancing; or (B) The debts to be refinanced are owed to a creditor other than the USDA. (b) Production losses. EM loan funds for production losses to agricultural commodities (except the losse… | ||||
| 7:7:7.1.1.4.15.9.9.2 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | I | Subpart I—Emergency Loan Program | § 764.352 Eligibility requirements. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 76 FR 75434, Dec. 2, 2011; 87 FR 13124, Mar. 9, 2022; 89 FR 65041, Aug. 8, 2024] | The applicant: (a) Must comply with the general eligibility requirements established at § 764.101. (b) Must be an established farmer. (c) Must be the owner-operator or tenant-operator as follows: (1) For a loan made under § 764.351(a)(1), must have been: (i) The owner-operator of the farm at the time of the disaster; or (ii) The tenant-operator of the farm at the time of the disaster whose lease on the affected real estate exceeds the term of the loan. The operator will provide prior notification to the Agency if the lease is proposed to terminate during the term of the loan. The lessor will provide the Agency a mortgage on the real estate as security for the loan; (2) For a loan made under § 764.351(a) (2) or (b), must have been the operator of the farm at the time of the disaster; and (3) In the case of an entity, the entity must be: (i) Engaged primarily and directly in farming in the United States; and (ii) Authorized to operate and own the farm, if the funds are used for farm ownership loan purposes, in the State in which the farm is located. (d) Must demonstrate the intent to continue the farming operation after the designated or declared disaster. (e) And all entity members must be unable to obtain sufficient credit elsewhere at reasonable rates and terms. To establish this, the applicant must obtain written declinations of credit, specifying the reasons for declination, from legally organized commercial lending institutions within reasonable proximity of the applicant as follows: (1) In the case of a loan in excess of $300,000, two written declinations of credit are required; (2) In the case of a loan of $300,000 or less, one written declination of credit is required; and (3) In the case of a loan of $100,000 or less, the Agency may waive the requirement for obtaining a written declination of credit, if the Agency determines that it would pose an undue burden on the applicant, the applicant certifies that they cannot get credit elsewhere, and based on the applicant's circumstances credit is… | |||
| 7:7:7.1.1.4.15.9.9.3 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | I | Subpart I—Emergency Loan Program | § 764.353 Limitations. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 76 FR 75434, Dec. 2, 2011; 89 FR 65041, Aug. 8, 2024] | (a) EM loans must comply with the general limitations established at § 764.102. (b) EM loans may not exceed the lesser of: (1) The amount of credit necessary to restore the farming operation to its pre-disaster condition; (2) In the case of a physical loss loan, the total eligible physical losses caused by the disaster; or (3) In the case of a production loss loan, 100 percent of the total actual production loss sustained by the applicant as calculated in paragraph (c) of this section. (c) For production loss loans, the applicant's actual crop production loss will be calculated as follows: (1) Subtract the disaster yield from the normal yield to determine the per acre production loss; (2) Multiply the per acre production loss by the number of acres of the farming operation devoted to the crop to determine the volume of the production loss; (3) Multiply the volume of the production loss by the market price for such crop as determined by the Agency to determine the dollar value for the production loss; and (4) Subtract any related compensation or insurance indemnities received or to be received by the applicant for the loss. (d) For a physical loss loan, the applicant's total eligible physical losses will be calculated as follows: (1) Add the allowable costs associated with replacing or repairing chattel covered by hazard insurance (excluding labor, machinery, equipment, or materials contributed by the applicant to repair or replace chattel); (2) Add the allowable costs associated with repairing or replacing real estate, covered by hazard insurance; (3) Add the value of replacement livestock and livestock products for which the applicant provided: (i) Written documentation of inventory on hand immediately preceding the loss; (ii) Records of livestock product sales sufficient to allow the Agency to establish a value; (4) Add the allowable costs to restore perennials to the stage of development the damaged perennials had obtained prior to the disaster; (5) Add, in the case of an individual applicant,… | |||
| 7:7:7.1.1.4.15.9.9.4 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | I | Subpart I—Emergency Loan Program | § 764.354 Rates and terms. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 86 FR 43392, Aug. 9, 2021; 89 FR 65041, Aug. 8, 2024] | (a) Rates. (1) The interest rate is the Agency's Emergency Loan Actual Loss rate, available in each Agency office. (2) The interest rate charged will be the lower rate in effect at the time of loan approval or loan closing. (b) Terms. (1) The Agency schedules repayment of EMs based on the useful life of the security and the type of loss. (2) The repayment schedule must include at least one payment every year. (3) EMs for annual farm operating and family living expenses, except expenses associated with establishing a perennial crop that are subject to paragraph (b)(4), must be repaid within 12 months. The Agency may extend this term to not more than 24 months to accommodate the production cycle of the agricultural commodities. (4) The standard repayment term of an EM for production losses or physical losses to chattel security (including assets with an expected life between 1 and 7 years) will be equal to the useful life of the security or 7 years, whichever is less. Repayment terms less than the standard term must be requested by the applicant in writing. The Agency may extend the repayment term up to a total length not to exceed 20 years, if adequate security is available, and repayment schedules may include equal installments, or unequal installments, if needed to establish a new enterprise, develop a farm, recover from a disaster or economic reversal, or reasonably increase cash flow margin to increase working capital reserves and savings, including reasonable savings for retirement and education, and security is adequate to support the term of the loan. Notwithstanding any other provision of this section, repayment schedules must be designed to ensure the loan is fully secured for the life of the loan. (5) The standard repayment term of an EM for physical losses to real estate will be equal to the useful life of the security or 40 years, whichever is less. Repayment terms less than the standard term must be requested by the applicant in writing. In no event will the term be more than 40 years from t… | |||
| 7:7:7.1.1.4.15.9.9.5 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | I | Subpart I—Emergency Loan Program | § 764.355 Security requirements. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 76 FR 75434, Dec. 2, 2011] | (a) EM loans made under § 764.351(a)(1) must comply with the general security requirements established at §§ 764.103, 764.104 and 764.155(b). (b) EM loans made as specified in § 764.351(a)(2) and (b) must generally comply with the general security requirements established in §§ 764.103, 764.104, and 764.255(b). These general security requirements, however, do not apply to equine loss loans to the extent that a lien is not obtainable or obtaining a lien may prevent the applicant from carrying on the normal course of business. Other security may be considered for an equine loss loan in the order of priority as follows: (1) Real estate, (2) Chattels and crops, other than horses, (3) Other assets owned by the applicant, (4) Third party pledges of property not owned by the applicant, (5) Repayment ability under paragraph (c) of this section. (c) Notwithstanding the requirements of paragraphs (a) and (b) of this section, when adequate security is not available because of the disaster, the loan may be approved if the Agency determines, based on an otherwise feasible plan, there is a reasonable assurance that the applicant has the ability to repay the loan provided: (1) The applicant has pledged as security for the loan all available personal and business security, except as provided in § 764.106; (2) The farm operating plan, approved by the Agency, indicates the loan will be repaid based upon the applicant's production and income history; addresses applicable pricing risks through the use of marketing contracts, hedging, options, or other revenue protection mechanisms, and includes a marketing plan or similar risk management practice; (3) The applicant has had positive net cash farm income in at least 3 of the past 5 years; and (4) The applicant has provided the Agency an assignment on any USDA program payments to be received. (d) For loans over $25,000, title clearance is required when real estate is taken as security. (e) For loans of $25,000 or less, when real estate is taken as security, a certification… | |||
| 7:7:7.1.1.4.15.9.9.6 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | I | Subpart I—Emergency Loan Program | § 764.356 Appraisal and valuation requirements. | FSA | [72 FR 63298, Nov. 8, 2007, as amended at 76 FR 75435, Dec. 2, 2011] | (a) In the case of physical losses associated with livestock, the applicant must have written documentation of the inventory of livestock and records of livestock product sales sufficient to allow the Agency to value such livestock or livestock products just prior to the loss. (b) In the case of farm assets damaged by the disaster, the value of such security shall be established as of the day before the disaster occurred. (c) In the case of an equine loss loan: (1) The applicant's Federal income tax and business records will be the primary source of financial information. Sales receipts, invoices, or other official sales records will document the sales price of individual animals. (2) If the applicant does not have 3 complete years of business records, the Agency will obtain the most reliable and reasonable information available from sources such as the Cooperative Extension Service, universities, and breed associations to document production for those years for which the applicant does not have a complete year of business records. | |||
| 7:7:7.1.1.4.15.9.9.7 | 7 | Agriculture | VII | D | 764 | PART 764—DIRECT LOAN MAKING | I | Subpart I—Emergency Loan Program | §§ 764.357-764.400 [Reserved] | FSA |
Advanced export
JSON shape: default, array, newline-delimited, object
CREATE TABLE cfr_sections (
section_id TEXT PRIMARY KEY,
title_number INTEGER,
title_name TEXT,
chapter TEXT,
subchapter TEXT,
part_number TEXT,
part_name TEXT,
subpart TEXT,
subpart_name TEXT,
section_number TEXT,
section_heading TEXT,
agency TEXT,
authority TEXT,
source_citation TEXT,
amendment_citations TEXT,
full_text TEXT
);
CREATE INDEX idx_cfr_title ON cfr_sections(title_number);
CREATE INDEX idx_cfr_part ON cfr_sections(part_number);
CREATE INDEX idx_cfr_agency ON cfr_sections(agency);