USDA HB-1-3555, Chapter 17 (Regular Servicing -), § 17.9 — Mineral Leases
USDA Handbook HB-1-3555 section 17.9 — Mineral Leases. Full verbatim section text, substring-verified against snapshot 481dcf71d80912ba.
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Verbatim provisions from USDA HB-1-3555, Chapter 17 (Regular Servicing -), § 17.9 — Mineral Leases — each quote is a verified substring of the regulator-published source snapshot, not retyped. Quoted for reference; this is not legal advice. The operational layer (P&P updates, prompts) lives in the regulation update kits.
USDA HB-1-3555, Chapter 17 (Regular Servicing -), § 17.9 — Mineral Leases
A servicer may consent to the lease of mineral rights and subordinate its lien to the lessee’s rights and interests in the mineral activity provided the subordination of the guaranteed loan to a mineral lease does not entitle the leaseholder to any proceeds from the sale of the security property and the following are met: • The security property will remain suitable as a residence; • The lender’s security interest will not be adversely affected; and • Rural Development’s environmental requirements are met. If the proposed activity is likely to decrease the value of the security property, the servicer may consent to the lease under the following conditions: • The borrower must assign 100 percent of the income from the lease to the servicer; • Proceeds will be utilized as a principal reduction to the loan; and • The total rent to be paid is at least equal to the estimated decrease in the market value of the security property. If the proposed activity is not likely to decrease the value of the security property, the servicer may consent to the lease if: • The borrower agrees to use any compensation received from the lessee to repair any damage to the site or dwelling; or • Assign the proceeds to the servicer to reduce the principal balance. The servicer remains responsible for documenting their approval and oversight of the above activity and borrower request. 17.10 UNAUTHORIZED ASSISTANCE [7 CFR 3555.257] Refer to HB-1-3555, Chapter 1 for information regarding unauthorized assistance.
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Source of record: https://claudeforcompliance.com/regs/usda-hb-3555-17-9/
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