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e-CFR data is current as of July 9, 2020

Title 7Subtitle BChapter VIISubchapter DPart 766Subpart E → §766.203


Title 7: Agriculture
PART 766—DIRECT LOAN SERVICING—SPECIAL
Subpart E—Servicing Shared Appreciation Agreements and Net Recovery Buyout Agreements


§766.203   Payment of recapture.

(a) The borrower must pay on the due date or 30 days from Agency notification, whichever is later:

(1) Seventy-five percent of the appreciation in the real estate security if the agreement is triggered within 4 years or less from the date of the writedown; or

(2) Fifty percent of such appreciation if the agreement is triggered more than 4 years from the date of the writedown or when the agreement matures.

(b) If the borrower sells a portion of the security, the borrower must pay shared appreciation only on the portion sold. Shared appreciation on the remaining portion will be due in accordance with paragraph (a) of this section.

(c) The amount of recapture cannot exceed the amount of the debt written off through debt writedown.

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