7 USC 2008h - Loan and loan servicing limitations

U.S Code last checked for updates: May 10, 2024

§ 2008h.

Loan and loan servicing limitations

(a)

Delinquent borrowers prohibited from obtaining direct operating loans

(b)

Prohibition of loans for borrowers that have received debt forgiveness

(1)

Prohibitions

Except as provided in paragraph (2)—

(A)

the Secretary may not make a loan under this chapter to a borrower that has received debt forgiveness on a loan made or guaranteed under this chapter; and

(B)

the Secretary may not guarantee a loan under this chapter to a borrower that has received—

(i)

debt forgiveness after April 4, 1996, on a loan made or guaranteed under this chapter; or

(ii)

received debt forgiveness on more than 3 occasions on or before April 4, 1996.

(2)

Exceptions

(A)

In general

The Secretary may make a direct or guaranteed farm operating loan for paying annual farm or ranch operating expenses of a borrower who—

(i)

was restructured with a write-down under section 2001 of this title;

(ii)

is current on payments under a confirmed reorganization plan under chapters 1

 So in original. Probably should be “chapter”.

11, 12, or 13 of title 11; or

(iii)

received debt forgiveness on not more than 1 occasion resulting directly and primarily from a major disaster or emergency designated by the President on or after April 4, 1996, under the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5121 et seq.).

(B)

Emergency loans

(i)

In general

The Secretary may make an emergency loan under section 1961 of this title to a borrower that—

(I)

on or before April 4, 1996, received not more than 1 debt forgiveness on a loan made or guaranteed under this chapter; and

(II)

after April 4, 1996, has not received debt forgiveness on a loan made or guaranteed under this chapter.

(ii)

Restructured loans

(c)

No more than 1 debt forgiveness for borrower on direct loan

(Pub. L. 87–128, title III, § 373, as added Pub. L. 104–127, title VI, § 648(b), Apr. 4, 1996, 110 Stat. 1104; amended Pub. L. 105–277, div. A, § 101(a) [title VIII, § 801], Oct. 21, 1998, 112 Stat. 2681, 2681–37; Pub. L. 107–171, title V, § 5319, May 13, 2002, 116 Stat. 348; Pub. L. 115–334, title V, § 5307, Dec. 20, 2018, 132 Stat. 4673.)

cite as: 7 USC 2008h