1. (a) The Secretary shall take such steps as may be necessary to obtain repayment on any loan that is in default and that is guaranteed under this subchapter.

2. (b) Upon default of a loan guaranteed under this subchapter and terminated pursuant to State law, a lender may file a claim under the guarantee for an amount not to exceed the lesser of—

   1. (1) the maximum guarantee; or

   2. (2) the difference between—

      1. (A) the total outstanding obligation on the loan, including principal, interest, and expenses authorized by the loan documents, through the date of the public sale (as authorized under such documents and State law); and
      2. (B) the amount realized at such sale.

(Added Pub. L. 105–368, title VI, § 601(a), Nov. 11, 1998, 112 Stat. 3344, § 3774; renumbered § 2053, Pub. L. 107–95, § 5(d)(1), Dec. 21, 2001, 115 Stat. 918.)

Editorial Notes

Amendments

2001—Pub. L. 107–95 renumbered section 3774 of this title as this section.

Statutory Notes and Related Subsidiaries

Effective Date

Section effective Oct. 1, 1998, see section 602(f) of Pub. L. 105–368, set out as an Effective Date of 1998 Amendment note under section 2106 of this title.