Page:United States Statutes at Large Volume 99 Part 2.djvu/423

 PUBLIC LAW 99-198—DEC. 23, 1985

99 STAT. 1533

"(2) The term 'farm program loan' means any loan made by the Administrator under the Small Business Act (15 U.S.C. 631 et seq.) for any of the purposes authorized for loans under subtitles A or B of the Consolidated Farm and Rural Development Act (7 U.S.C. 1921 et seq.). "(3) The term 'homestead property' means the principal residence and adjoining property possessed and occupied by a borrower specified in paragraph (2) of this subsection. "(4) The term 'Secretary' means the Secretary of Agriculture. "(b)(1) If the Secretary forecloses a loan made or insured under the Consolidated Farm and Rural Development Act (7 U.S.C. 1921 et seq.), the Administrator forecloses a farm program loan made under the Small Business Act (15 U.S.C. 631 et seq.), or a borrower of a loan made or insured by either agency declares bankruptcy or goes into voluntary liquidation to avoid foreclosure or bankruptcy, the Secretary or Administrator may upon application by the borrower, permit the borrower to retain possession and occupancy of any principal residence of the borrower, and a reasonable amount of adioining land for the purpose of family maintenance. (2) The value of the homestead property shall be determined insofar as possible by an independent appraisal made within six months from the date of the borrower's application to retain possession and occupancy of the homestead property. "(3) The period of occupancy of homestead property under this subsection may not exceed five years, but in no case shall be the Secretary or the Administrator grant a period of occupancy less than three years, subject to compliance with the requirements of subsection (c). "(c) To be eligible to occupy homestead property, a borrower of a loan made or insured by the Secretary or the Administrator must— "(1) apply for such occupancy during the three-year period beginning on the date of the enactment of this Act; '(2) have exhausted all other remedies for the extension or restructuring of such loan, including all remedies afforded under section 331(d); "(3) have made gross annual farm sales of at least $40,000 in at least two calendar years during the five-year period beginning on January 1, 1981, and ending on December 31, 1985 (or the equivalent crop or fiscal years); "(4) have received from mrming operations at least 60 per centum of the gross annual income of the borrower and any spouse of the borrower during at least two years of such fiveyear period; "(5) have occupied the homestead property, and engaged in farming or ranching operations on adjoining land, or other land controlled by said borrower, during such five-year period; "(6) during the period of occupancy of the homestead propn erty, pay a reasonable sum as rent for such property to the Secretary or the Administrator in an amount substantially equivalent to rents charged for similar residential properties in the area in which the homestead property is located, and failure to make rental payments in a timely fashion shall constitute cause for the termination of all rights of a borrower to possession and occupancy of the homestead property under this subsection; "(7) during the period of occupancy of homestead property, maintain such property in good condition; and

Loans,

Loans.

Prohibition,

Loans,

Ante, p. 1523.

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