12 U.S.C. § 2201 — Notice of action on application

Page 1334 TITLE 12—BANKS AND BANKING § 2201 1707; amended Pub. L. 100–233, title I, § 104, Jan. 6, 1988, 101 Stat. 1579.) Editorial Notes AMENDMENTS 1988—Pub. L. 100–233 substituted ‘‘qualified lenders’’ for ‘‘System institutions’’ and inserted ‘‘and copies of each appraisal of the borrower’s assets made or used by the qualified lender’’ before period at end. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective thirty days after Dec. 23, 1985, see section 401 of Pub. L. 99–205, set out as an Effective Date of 1985 Amendment note under section 2001 of this title. § 2201. Notice of action on application (a) Loan applications Each qualified lender to which a person has applied for a loan shall provide the person with prompt written notice of— (1) the action on the application; (2) if the loan applied for is reduced or de- nied, the reasons for such action; and (3) the applicant’s right to review under sec- tion 2202 of this title. (b) Distressed loans Each qualified lender that has a distressed loan outstanding that is subject to restructuring requirements under this chapter shall provide, in accordance with regulations prescribed by the Farm Credit Administration, the borrower with prompt written notice of— (1) any action taken with respect to restruc- turing the loan under section 2202a of this title; (2) if restructuring is denied, the reasons for such action; and (3) the borrower’s right to review under sec- tion 2202 of this title. (Pub. L. 92–181, title IV, § 4.13B, formerly § 4.13, Dec. 10, 1971, 85 Stat. 613, renumbered § 4.13B and amended Pub. L. 99–205, title III, §§ 301(a), 302, Dec. 23, 1985, 99 Stat. 1707, 1708; Pub. L. 100–233, title I, § 105, Jan. 6, 1988, 101 Stat. 1579.) Editorial Notes AMENDMENTS 1988—Pub. L. 100–233 amended section generally. Prior to amendment, section read as follows: ‘‘Every appli- cant for a loan from an institution of the System shall be entitled to prompt written notice of action on his application, and, if the loan applied for is reduced or denied, the reason for such action, and of the appli- cant’s right to review under section 2202 of this title.’’ 1985—Pub. L. 99–205, § 302, provided for a ‘‘written’’ no- tice and for the applicant’s right to review under sec- tion 2202 of this title. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1985 AMENDMENT Amendment by Pub. L. 99–205 effective thirty days after Dec. 23, 1985, see section 401 of Pub. L. 99–205, set out as a note under section 2001 of this title. § 2202. Reconsideration of actions (a) Credit review committees (1) In general The board of directors of each qualified lend- er shall establish one or more credit review committees, which shall include farmer board representation. (2) Membership In no case shall a loan officer involved in the initial decision on a loan serve on the credit review committee when the committee re- views such loan. (b) Review of decisions (1) Denials or reductions Any applicant for a loan from a qualified lender that has received a written notice issued under section 2201 of this title of a deci- sion to deny or reduce the loan applied for may submit a written request, not later than 30 days after receiving a notice denying or re- ducing the amount of the loan application, to obtain a review of the decision before the cred- it review committee. (2) Denials of restructuring A borrower of a loan from a qualified lender that has received notice, under section 2201 of this title, of a decision to deny loan restruc- turing with respect to a loan made to the bor- rower, if the borrower so requests in writing within 7 days after receiving such notice, may obtain a review of such decision in person be- fore the credit review committee. (c) Personal appearance An applicant for a loan or for restructuring, who is entitled to and has requested a review under this section, may appear in person before the credit review committee, and may be accom- panied by counsel or by any other representa- tive of such person’s choice, to seek a reversal of the decision on the application under review. (d) Independent appraisal (1) In general An appeal filed with a credit review com- mittee under this section may include, as a part of the request for a review of the decision filed under subsection (b)(1) or (2), a request for an independent appraisal, by an accredited appraiser, of any interests in property secur- ing the loan (other than the stock or partici- pation certificates of the qualified lender held by the borrower). (2) Arrangement and cost Within 30 days after a request for an ap- praisal under paragraph (1), the credit review committee shall present the borrower with a list of three appraisers approved by the appro- priate qualified lender from which the bor- rower shall select an appraiser to conduct the appraisal the cost of which shall be borne by the borrower, and shall consider the results of such appraisal in any final determination with respect to the loan. (3) Copy to borrower A copy of any appraisal made under this sub- section shall be provided to the borrower.