Current as of October 03, 2022 | Updated by FindLaw Staff
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The lender must service the loan in accordance with this subpart and perform the services contained in this section in a reasonable and prudent manner. The lender is responsible for the actions of its agents and representatives.
(a) Funds management. The lender must have a funds management system to receive and process borrower payments, including the following.
(1) All principal and interest (P&I) funds and guarantee fees collected and deposited into the appropriate custodial accounts.
(2) Payments to custodial escrow accounts for taxes and insurance premiums, assessments that might impair the security (such as ground rent), and reserve accounts for repair and capital improvement of the property.
(b) Asset management. The lender must ensure that the property securing the guaranteed loan remains in good physical and financial condition, in accordance with project management requirements contained in subpart H of this part.
(c) Management of delinquencies and defaults. Each month the lender must report to the Agency any delinquencies and defaults in accordance with subpart H of this part.
Cite this article: FindLaw.com - Code of Federal Regulations Title 7. Agriculture § 7.3565.402 Servicing responsibilities - last updated October 03, 2022 | https://codes.findlaw.com/cfr/title-7-agriculture/cfr-sect-7-3565-402/
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