[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: 25CFR103.37]

[Page 313-314]
 
                            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. 103.37  What must the lender do to collect payment under its loan 
guaranty certificate or loan insurance coverage?

    (a) For guaranteed loans, the lender must submit a claim for its 
loss on a form approved by BIA.
    (1) If the lender makes an immediate claim under Sec. 103.36(d)(1), 
it must send BIA the claim for loss within 90 calendar days of the 
default by certified mail (return receipt requested), or by a 
nationally-recognized overnight delivery service (signature of recipient 
required). The lender's claim for loss may include interest that has 
accrued on the outstanding principal amount of the loan only through the 
date it submits the claim.
    (2) If the lender elects first to liquidate the collateral securing 
the loan under Sec. 103.36(d)(2), and has a residual loss after doing 
so, it must send BIA the claim for loss within 30 calendar days of 
completing all liquidation efforts. The lender must perform collateral 
liquidation as expeditiously and thoroughly as is reasonably possible, 
within the standards established by this part. The lender's claim for 
loss may include interest that has accrued on the outstanding principal 
amount of the loan only through the earlier of:
    (i) The date it submits the claim;
    (ii) The date the lender gets a judgment of foreclosure or sale (or 
the non-judicial equivalent) on the principal collateral securing the 
loan; or
    (iii) One hundred eighty calendar days after the date of the 
default.
    (b) For insured loans, after liquidating all loan collateral, the 
lender must submit a claim for its loss (if any) on a form approved by 
BIA. The lender must send BIA the claim for loss by certified mail 
(return receipt requested), or by a nationally-recognized overnight 
delivery service (signature of recipient required) within 30 calendar 
days of completing all liquidation efforts. The lender must perform 
collateral liquidation as expeditiously and thoroughly as is reasonably 
possible, within the standards established by this part. The lender's 
claim for loss may include interest that has accrued on the outstanding 
principal amount of the loan through the earlier of:
    (1) The date it submits the claim;
    (2) The date the lender gets a judgment of foreclosure or sale (or 
the non-judicial equivalent) on the principal collateral securing the 
loan; or
    (3) One hundred eighty calendar days after the date of the default.
    (c) Whenever the lender liquidates loan collateral under Sec. 
103.36(d)(2), it must vigorously pursue all reasonable methods of 
collection concerning the loan collateral before submitting a claim for 
its residual loss (if any) to BIA. Without limiting the generality of 
the preceding sentence, the lender must:
    (1) Foreclose, either judicially or non-judicially, all rights of 
redemption the borrower or any co-maker or guarantor of the loan (other 
than BIA) may have in collateral under any mortgage securing the loan;
    (2) Gather and dispose of all personal property pledged as 
collateral under the loan, in accordance with applicable law;
    (3) Exercise all set-off rights the lender may have under contract 
or applicable law;
    (4) Make demand for payment on the borrower, all co-makers, and all 
guarantors of the loan (other than BIA); and
    (5) Participate fully in all bankruptcy proceedings that may arise 
involving the borrower and any co-maker or guarantor of the loan. Full 
participation might include, for example, filing a proof of claim in the 
case, attending creditors' meetings, and seeking a court order releasing 
the automatic stay of collection efforts so that the lender can 
liquidate affected loan collateral.
    (d) BIA may require further information, including without 
limitation copies of any documents the lender is to maintain under Sec. 
103.32 and all documentation of liquidation efforts, to help BIA 
evaluate the lender's claim for loss.

[[Page 314]]

    (e) BIA will pay the lender the guaranteed or insured portion of the 
lender's claim for loss, to the extent the claim is based upon 
reasonably sufficient evidence of the loss and compliance with the 
requirements of this part. BIA will render a decision on a claim for 
loss within 90 days of receiving all information it requires to properly 
evaluate the loss.