Oregon Administrative Rules
Chapter 123 - OREGON BUSINESS DEVELOPMENT DEPARTMENT
Division 300 - Community Lender Loan Loss Account Program
Section 123-300-1501 - Termination of Continued Loan Enrollment, Repayment of Balance, and Withdrawal from the Program

Universal Citation: OR Admin Rules 123-300-1501

Current through Register Vol. 63, No. 9, September 1, 2024

(1) Should a Loan Loss Reserve Account balance reach zero or be expected to reach zero with the payment of a Claim, the Agreement shall be terminated subject to a final report being provided to the Department which shall be due within 45 days of the earlier of the Loan Loss Reserve Account reaching zero or the termination date of the Agreement.

(2) At such time the Loan Loss Reserve Account reaches zero or the Agreement is terminated, the Loan Loss Reserve Account shall be closed and any outstanding fees or balance due shall be paid in full by the lender.

(3) The Department may terminate enrollment of new Qualified Loans under the Program for a lender or terminate the lender's Agreement altogether upon a 30-day notice of termination to the lender or such earlier date if the Department determines:

(a) The lender has failed to prudently underwrite, document and/or collect on the Loan Loss Reserve Account portfolio consistent with the terms and conditions of these rules or the Agreement.

(b) The lender has not enrolled a Qualified Loan for 24 consecutive months;

(c) The Loan Loss Reserve Account or Enrolled Loan portfolio of the lender has been in whole or in part, sold, transferred, assigned or subrogated;

(d) The lender has become insolvent or has ceased lending operations in Oregon. This provision shall apply whether or not a new financial institution, lender, or loan servicer purchases some or all of the loans of the lender;

(e) The lender fails to provide the required reporting as provided by OAR 123-300-1401;

(f) The lender fails to perform in any material way under the Agreement, the Act or under these administrative rules; or

(g) The lender makes a material misrepresentation in the submission to the Department of any of the following: the proposal to the RFP, Enrolled Loan documentation, Claims documentation, or reports required by the Program.

(4) The balance of funds in a lender's Loan Loss Reserve Account shall be repaid to the State for deposit in the General as directed by the Department if the Department terminates the lender's Agreement after determining that the circumstances under (3) above were met.

(5) A lender may withdraw from the Program after giving written notice to the Department. After receipt of this notice, the Department shall calculate the amount the lender shall be required to repay to the department based on the amount of moneys awarded to the lender under the Program, the amount of moneys remaining in the Loan Loss Reserve Account, and the aggregate amount of approved Claims as of the date of the withdrawal notice.

(6) A lender that withdraws from the program before maturity of the Agreement or a lender whose Agreement is terminated under section (3) of this rule shall have no rights to any portion of the Loan Loss Reserve Account award or any remaining balance thereof. Upon withdrawal or such termination, the Loan Loss Reserve Account shall be closed and any outstanding fees or balance due shall be paid in full by the lender.

(7) Termination of an Agreement does not waive other remedies the Department may exercise under the Agreement in the event of a lender's default, nor does Termination absolve a lender of any contractual obligations owed to a Borrower under an Enrolled Loan agreement with the lender.

Statutory/Other Authority: ORS 285A.075 & ORS 285B.780 - ORS 285B.799

Statutes/Other Implemented: ORS 285B.780 - ORS 285B.799 & ORS 706.008

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