§2201 — Title 12 Banks and Banking | U.S. Code

Summary

Qualified lenders must give people a quick written notice about what happened with their loan application. If the loan is made smaller or turned down, the lender must say why and tell the applicant they can ask for a review under section 2202. If a qualified lender has a distressed loan that must be restructured, the lender must, following rules from the Farm Credit Administration, give the borrower a quick written notice about any restructuring action, explain why restructuring was denied if it is denied, and tell the borrower about the right to a review under section 2202.

Title 12, §2201

Banks and Banking — Source: USLM XML via OLRC

(a)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 denied, the reasons for such action; and

(3)the applicant’s right to review under section 2202 of this title.

(b)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 restructuring 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 section 2202 of this title.

Notes & Related Subsidiaries

Editorial Notes

Amendments

1988—Pub. L. 100–233 amended section generally. Prior to amendment, section read as follows: “Every applicant 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 applicant’s right to review under section 2202 of this title.” 1985—Pub. L. 99–205, § 302, provided for a “written” notice and for the applicant’s right to review under section 2202 of this title.

Statutory Notes and Related Subsidiaries

Effective Date

of 1985 AmendmentAmendment 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.

§2201 Notice of action on application