[Code of Federal Regulations]

[Title 31, Volume 3]

[Revised as of July 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 31CFR901.7]



[Page 965-966]

 

                  TITLE 31--MONEY AND FINANCE: TREASURY

 

   CHAPTER IX--FEDERAL CLAIMS COLLECTION STANDARDS (DEPARTMENT OF THE 

                    TREASURY--DEPARTMENT OF JUSTICE)

 

PART 901_STANDARDS FOR THE ADMINISTRATIVE COLLECTION OF CLAIMS--Table 

of Contents

 

Sec. 901.7  Liquidation of collateral.



    (a) Agencies should liquidate security or collateral through the 

exercise of a power of sale in the security instrument or a nonjudicial 

foreclosure, and apply the proceeds to the applicable debt(s), if the 

debtor fails to pay



[[Page 966]]



the debt(s) within a reasonable time after demand and if such action is 

in the best interest of the United States. Collection from other 

sources, including liquidation of security or collateral, is not a 

prerequisite to requiring payment by a surety, insurer, or guarantor 

unless such action is expressly required by statute or contract.

    (b) When an agency learns that a bankruptcy petition has been filed 

with respect to a debtor, the agency should seek legal advice from its 

agency counsel concerning the impact of the Bankruptcy Code, including, 

but not limited to, 11 U.S.C. 362, to determine the applicability of the 

automatic stay and the procedures for obtaining relief from such stay 

prior to proceeding under paragraph (a) of this section.