Or. Admin. R. 123-021-3500

Current through Register Vol. 63, No. 8, August 1, 2024

Section 123-021-3500 - Lender Agreement

No Loan Insurance Authorization shall be effective unless the Financial Institution and the Department have executed a Lender Agreement in a form acceptable to the Department setting forth the relative rights and responsibilities of the Financial Institution and the Department for all insured loans. The Lender Agreement shall include the following:

(1) Provisions incorporating the requirements of this division of the rules and ORS 285.466 to 285.481.

(2) Provisions setting forth the responsibilities of the Financial Institution to prudently underwrite and service insured loans in such a manner as would be the normal and customary practice of a prudent lender making or servicing a loan without relying on loan insurance.

(3) A requirement that the Financial Institution notify the Department in writing within 5 business days after a Borrower's payment is 30 business days late and within 30 business days of any other default or other event or condition indicating that the loan may not be repaid in full. Upon default, the Financial Institution shall provide the Department a liquidation plan detailing such action as may be prudent, including without limitation foreclosing on and liquidating collateral. After obtaining the Department's approval of the liquidation plan, the Financial Institution shall take such action to foreclose on and liquidation the assets and pursue remedies against the guarantees securing the loan.

(4) A description of the Department's insurance Programs and the method for paying insurance claims.

(5) The Department shall be entitled at its discretion to cancel or reduce its insurance obligation if the Financial Institution breaches its responsibilities under the Lender Agreement or the Department-approved liquidation plan.

(6) Such other terms and conditions as the Department deems appropriate.

Or. Admin. R. 123-021-3500

EDD 5-1994(Temp), f. & cert. ef. 3-3-94; EDD 11-1994, f. & cert. ef. 7-29-94; EDD 24-2008, f. 7-31-08, cert. ef. 8-1-08; EDD 17-2009, f. 10-30-09, cert. ef. 11-1-09; OBDD 3-2023, renumbered from 123-021-0100, filed 01/18/2023, effective 1/18/2023; OBDD 4-2023, temporary amend filed 01/25/2023, effective 1/25/2023 through 7/23/2023; OBDD 27-2023, renumbered from 123-021-1400, filed 10/06/2023, effective 10/6/2023; OBDD 28-2023, temporary amend filed 10/13/2023, effective 10/13/2023 through 4/5/2024; OBDD 2-2024, amend filed 03/06/2024, effective 3/8/2024

Statutory/Other Authority: ORS 285A.075 & 285B.200 - 285B.218

Statutes/Other Implemented: ORS 285B.200 - 285B.218