[Code of Federal Regulations]
[Title 25, Volume 1]
[Revised as of April 1, 2005]
From the U.S. Government Printing Office via GPO Access
[CITE: 25CFR103.35]

[Page 311]
 
                            TITLE 25--INDIANS
 
     CHAPTER I--BUREAU OF INDIAN AFFAIRS, DEPARTMENT OF THE INTERIOR
 
PART 103_LOAN GUARANTY, INSURANCE, AND INTEREST SUBSIDY--Table of Contents
 
                  Subpart G_Default and Payment by BIA
 
Sec. 103.35  What must the lender do if the borrower defaults on the loan?


    (a) The lender must send written notice of the default to the 
borrower, and otherwise meet the standard of care established for the 
lender in this part. The lender's notice to the borrower should be sent 
as soon as possible after the default, but in any event before the 
lender's notice to BIA under paragraph (b) of this section. For purposes 
of the Program, ``default'' will mean a default as defined in this part.
    (b) The lender also must send written notice of the default to BIA 
by certified mail (return receipt requested), or by a nationally-
recognized overnight delivery service (signature of recipient required) 
within 60 calendar days of the default, unless the default is fully 
cured before that deadline. This notice is required even if the lender 
grants the borrower a forbearance under Sec. 103.36(a). One purpose of 
the notice is to give BIA the opportunity to intervene and seek 
assistance for the borrower, even though BIA has no duty, either to the 
lender or the borrower, to do so. Another purpose of the notice is to 
permit BIA to plan for a possible loss claim from the lender, under 
Sec. 103.36(d). The lender's notice must clearly indicate:
    (1) The identity of the borrower;
    (2) The applicable Program guaranty certificate or insurance 
agreement number;
    (3) The date and nature of all bases for default;
    (4) If a monetary default, the amount of past due principal and 
interest, the date through which interest has been calculated, and the 
amount of any late fees, precautionary advances, or other amounts the 
lender claims;
    (5) The nature and outcome of any correspondence or other contacts 
with the borrower concerning the default; and
    (6) The precise nature of any action the borrower could take to cure 
the default.