7 CFR §1980.471

Verified against eCFR.gov as of June 20, 2026View official text on eCFR.gov ↗

(See § 1980.64 of subpart A of this part.) Refer to RD Instruction 1980-E, Appendix G, Liquidation and Property Management Guide (available in any Rural Development office) for advice on how to interact with the lender on liquidations and property management.

(a)Collateral acquired by the lender can only be released after a complete review of the proposal.
1. (1)There may be instances when the lender acquires the collateral of a business where the cost of liquidation exceeds the potential recovery value of the collection. Whenever this occurs the lender with the concurrence of Rural Development on the collateral in lieu of liquidation.
2. (2)Sale of acquired collateral to the former borrower, former borrower's stockholder(s) or officer(s), the lender or lender's stockholder(s) or officer(s) must be based on an arm's length transaction with the concurrence of Rural Development.