[Code of Federal Regulations]
[Title 7, Volume 7, Parts 700 to 899]
[Revised as of January 1, 2001]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR762.101]

[Page 405]
 
                          TITLE 7--AGRICULTURE
 
                            CHAPTER VII--FARM
                SERVICE AGENCY, DEPARTMENT OF AGRICULTURE
 
PART 762--GUARANTEED FARM LOANS--Table of Contents
 
Sec. 762.101  Introduction.

    (a) Scope. This subpart contains regulations governing Operating 
Loans and Farm Ownership loans guaranteed by the Farm Service Agency. 
This subpart applies to lenders, holders, borrowers, Agency personnel, 
and other parties involved in making, guaranteeing, holding, servicing, 
or liquidating such loans.
    (b) Policy. The Agency issues guarantees on loans made to qualified 
loan applicants without regard to race, color, religion, sex, national 
origin, marital status, or age, provided the loan applicant can enter 
into a legal and binding contract, or whether all or part of the 
applicant's income derives from any public assistance program or whether 
the applicant, in good faith, exercises any rights under the Consumer 
Protection Act.
    (c) Lender list and classification. (1) The Agency maintains a 
current list of lenders who express a desire to participate in the 
guaranteed loan program. This list is made available to farmers upon 
request.
    (2) Lenders who participate in the Agency guaranteed loan program 
will be classified into one of the following categories:
    (i) Standard Eligible Lender under Sec. 762.105,
    (ii) Certified Lender, or
    (iii) Preferred Lender under Sec. 762.106.
    (3) Lenders may continue to make loans under Approved Lender Program 
(ALP) agreements until they expire; however, these agreements will not 
be renewed when they expire. All ALP agreements with farm credit 
institutions will expire on February 12, 2001.
    (d) Type of guarantee. Guarantees are available for both a loan note 
or a line of credit. A loan note is used for a loan of fixed amount and 
term. A line of credit has a fixed term, but no fixed amount. The 
principal amount outstanding at any time, however, may not exceed the 
line of credit ceiling contained in the contract. Both guarantees are 
evidenced by the same loan guarantee form.
    (e) Termination of loan guarantee. The loan guarantee will 
automatically terminate as follows:
    (1) Upon full payment of the guaranteed loan. A zero balance within 
the period authorized for advances on a line of credit will not 
terminate the guarantee;
    (2) Upon payment of a final loss claim; or
    (3) Upon written notice from the lender to the Agency that a 
guarantee is no longer desired provided the lender holds all of the 
guaranteed portion of the loan. The loan guarantee will be returned to 
the Agency office for cancellation within 30 days of the date of the 
notice by the lender.