[Code of Federal Regulations]
[Title 38, Volume 1]
[Revised as of January 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 38CFR11.83]

[Page 542]
 
            TITLE 38--PENSIONS, BONUSES, AND VETERANS' RELIEF
 
                CHAPTER I--DEPARTMENT OF VETERANS AFFAIRS
 
PART 11_LOANS BY BANKS ON AND PAYMENT OF ADJUSTED SERVICE 
 
Sec.  11.83  Additional loans by reason of 50 percent loan value.

    (a) It will be the policy of the Department of Veterans Affairs to 
redeem all loans made in accordance with the law and regulations made 
pursuant thereto, when such loans are made in good faith to the veteran 
to whom the certificate was issued. If, while his certificate is held by 
a bank as security for a loan, the veteran applies for the increased 
loan value authorized by the amendment to the World War Adjusted 
Compensation Act dated February 27, 1931, whether or not the loan has 
matured, the veteran and the bank will be informed fully of the 
provisions of this section and that the bank may make the loan for the 
additional amount or, upon request of the veteran, may send the note and 
certificate to the Secretary of Veterans' Affairs. The Secretary shall, 
if the loan was legally made, accept such certificate and note, and pay 
to the bank in full satisfaction of its claim the amount of the unpaid 
principal due it and the unpaid interest at the rate authorized by the 
World War Adjusted Compensation Act, as amended, up to the date of the 
check issued to the bank. If the veteran has not filed application for 
final settlement of his adjusted service certificate under the 
provisions of the Adjusted Compensation Payment Act, 1936, and demand is 
made upon the bank to present the note and certificate for redemption 
prior to the maturity date of the loan and during the lifetime of the 
veteran, interest will be payable up to the date the check is issued to 
the bank, or, if demanded by the bank, up to the maturity date of the 
loan.
    (b) If, however, an application for final settlement is filed and 
the bank is notified to present the note and certificate to the 
Secretary and does so within 15 days after the mailing of such notice 
interest will be payable to the date the check is issued to the bank. If 
the bank fails to forward the note and certificate within 15 days after 
the mailing of the notice, interest shall be paid only up to the 
fifteenth day after the mailing of such notice.

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