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Thursday, August 19,1948
county committee, which will retain copies of all documents. The county committee may designate in writing cer tain employees of the County Agricul tural Conservation Association to execute such forms on behalf of the committee.
Loans may be obtained either from ap proved lending agencies or direct from CCC, at the option of the borrower. The county committee will furnish the bor rower with the names of lending agencies approved for making disbursements on loan documents. Approved loan docu ments will be transmitted for disburse ment to the lending agency or to CCC
by the county committee.
245.202 Availability of loans. Loans will be available in all areas of the con tinental United States. Loans will be available from September 15, 1948, through December 31, 1948, inclusive.
245.203 Approved lending agencies.
An approved lending agency shall be any bank, cooperative marketing association, corporation, partnership, individual, or other legal entity with which CCC has entered into a Lending Agency Agree ment Form PMA-97, or other form pre scribed by CCC.
245.204 Eligible borrowers. An eli gible borrower shall be a any person, partnership, association or corporation that has executed an application and certificate of eligibility Form 48Pota toes5, Revised whose eligibility to par ticipate in 1948 potato price support op erations has been certified by the appro priate county committee, and whose cer tificate of eligibility is in full force and effect hereinafter referred to as eligible producer, or b any dealer or cooper ative marketing association of producers that has become eligible to participate in the 1948 potato price support program on a contract basis by means of execut ing a Dealer Agreement Form 48Pota toes3, or other form prescribed by CCC
which has been approved by CCC and is in effect. All eligible borrowers must have access to grading facilities.
245.205 Eligible potatoes. Eligible potatoes shall be 1948 crop Irish potatoes produced by eligible producers which are of a quality suitable for storage, are properly stored in permanent storage which meets specifications established by the State committee, and are of a quality which will justify grading. Potatoes con taining more than 2 percent soft rot or more than 3 percent dry rot including late blight shall not be eligible for loan.
In order to make certain that the pota toes are of a quality suitable for storage, county committees may require that the potatoes remain in storage for a specified period prior to inspection and approval for loan.
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FEDERAL REGISTER

and the approval of all loan documents will be completed by December 31, 1948
245.207 Approved forms. The ap proved forms constitute the loan docu ments which, together with the pro visions of this bulletin, govern the rights and responsibility of the borrower and of CCC, and should be read carefully. Notes and chattel mortgages must be approved prior to January 1,1949, unless later ap proval is specifically authorized by CCC, and must be executed in accordance with this bulletin with State and documentary revenue stamps affixed thereto where re quired, by law. Notes and chatter mort gages executed by an administrator, ex ecutor, or trustee, will be acceptable only where legally valid. At no time shall loan documents be approved if the value of the collateral has been impaired. Loan documents shall not be approved after the expiration of the 20 calendar day period following the date of inspection of potatoes offered as collateral unless the county committee first determines that the potatoes so offered are intact and that their value is unimpaired. In the event the potatoes are destroyed or their value is impaired after the loan documents are approved but prior to dis bursement, the loan documents shall not be eligible for disbursement. Any fraud ulent representation made by a borrower in obtaining a loan or in executing any of the loan documents will render him subject to criminal prosecution.
a Applications for loan shall be sub mitted on Form 501.
b Each loan shall be evidenced by a promissory note, executed by the bor rower on CCC Commodity Form A.
c Each loan shall be secured by a chattel mortgage executed by the bor rower on CCC Commodity Form AA.
245.208 A m o u n t of loan. The amount of the loan shall be computed in accordance with the 1948 schedule of Loan Rates set out in 245.219 on the quantity of U. S. No. 1 quality potatoes in the unit at the applicable loan rate for U. S. No. 1 potatoes, plus the quan tity of U. S. No. 1 size B and U. S. No. 2
1% inches minimum quality potatoes in the unit at the applicable loan rates for U. S. No. 2 potatoes.
245.209 Storage charges. All storage costs shall be assumed and paid by the borrower.
245.210 Liens. The potatoes must be free and clear of all liens and encum brances, or if liens or encumbrances exist on the potatoes, proper waivers must be obtained.
245.211 Service fees. A service fee shall be charged for each loan in the amount of one cent per hundredweight for each hundredweight of potatoes 245.206 Applications and period for placed under loan but not less thanS.OO
making loans, a Applications for loans for each loan and shall be collected from shall be made at the office of the county the proceeds of the loan.
committee for the county where the po 245.212 Set-offs. If the applicant is tatoes are stored.
indebted to CCC other than a current b Applications for loans may be ac loan which has not matured, or if the cepted between September 15, 1948 and applicant is listed oh the county debt December 15, 1948. However, the State register as being indebted to any agency Committee shall, if necessary, set a final or corporation of the United States De date for accepting applications suffi partment of Agriculture, the loan shall ciently in advance of December 15, 1948, not be approved unless the applicant in order that all inspections of potatoes designates the CCC, or other agency or
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corporation to which he is indebted, as the payee of the proceeds of the loan to the extent of such indebtedness, but not to exceed that portion of the proceeds re maining after deduction of the service fees and amounts due prior lien holders.
Indebtedness owing to CCC shall be given first consideration after claims of prior lien holders.
245.213 Interest rate. Loans shall bear interest at the rate of 3 percent per annum, and interest shall accrue from the date of disbursement of the loan, not withstanding the printed provisions of the note.
245.214 Insurance. CCC will not re quire the borrower to insure the potatoes placed under loan: however, if the bor rower does insure such potatoes, such in surance shall inurfe to the benefit of CCC to the extent of its interest, after first satisfying the borrowers equity in the potatoes involved in the loss market value or support value, whichever is higher, of the potatoes, less the value of such potatoes at loan rates plus interest to date of loss.
245.215 Maturity and satisfaction of loans, a Loans shall mature on de mand but not later than April 30, 1949.
b The loan shall be satisfied, on or before the maturity of the note, by pay ment by the borrower in cash of the prin cipal amount plus interest. Repayment may be made to the lending agency, or, if the note is held by CCC, to the county committee. Upon full repayment of a loan, the county committee should be requested to release the mortgage by fil ing an instrument of release or by a mar ginal release on the records of the county recording office.
c The borrower may, prior to the maturity of the loan, make partial re demptions of the potatoes in order to sell them to others than CCC by payment of such portion of the loan plus interest as is equal to the amount of the net proceeds to be received from the sale of the potatoes gross proceeds less ap proved charges for marketing services performed or the loan value of the po tatoes to be redeemed plus interest, whichever is greater.
d CCC will not accept delivery of the mortgaged potatoes in satisfaction of the loan; however the borrower shall apply on the loan in repayment thereof all of the net proceeds gross proceeds less approved charges for marketing serv ices performed accruing to him from the sale to CCC under other programs of any potatoes owned by him, whether or not such potatoes are collateral security for the loan.
245.216 Deficiencies due to flood, fire, lightning or windstorm. CCC will not make any allowance for loss in the qual ity and quantity of the potatoes which results in a deficiency on the loan, ex cept that uninsured physical loss or dam age occurring without fault, negligence, or conversion on his part and resulting solely from flood, fire, lightning, or wind storm will be assumed by CCC, but only to the extent of the deficiency which re sults after the application of the sales value of undamaged potatoes covered by the mortgage or the loan value thereof plus interest, whichever is greater, plus