source:
  type: regulation
  id: usda-7cfr-3550.211
  authority: 7 CFR §3550.211 — Liquidation (RHS Direct Single Family Housing)
  description: '7 CFR §3550.211 establishes the RHS Direct Section 502 SFH

    liquidation framework: borrower responsibility for liquidation /

    acquisition expenses; tribal-trust-land safeguards (offer to

    transfer to tribe / tribal member / Indian Housing Authority);

    acceleration-with-notice; voluntary-liquidation paths (refinance/

    sale, DIL, third-party offer at NRV); bankruptcy interplay;

    junior-lienholder-foreclosure handling; payment-subsidy treatment;

    eligibility-for-special-servicing cutoff; and IRS / CRA reporting.

    '
obligations:
- id: usda-7cfr-3550.211-a
  canonical_id: usda-7cfr-3550.211-a
  section: 7 CFR §3550.211(a)
  description: '(a): (a) Policy. When RHS determines that a borrower is unable or unwilling to meet loan
    obligations, RHS may accelerate the loan and, if necessary, acquire the security property . The borrower
    is responsible for all expenses associated with liquidation and acquisition. If the account is satisfied
    in ful…'
  type: do
  tags:
  - regulator-direct
  - section-complete
  - cfpb-regulation
  primary_source:
    tier: 1
    authority: 7 CFR §3550.211(b)
    source_class: usda-regulation
    source_url: https://www.law.cornell.edu/cfr/text/7/3550.211
    snapshot_id: 23e775c48999aadb
    fetched_at: '2026-05-24T19:34:37Z'
    content_hash: sha256:096116c07c4bda9ba23440b0afd65faee1ed2fbdd9507000c8d35298c5f86105
    paragraph_quote: (a) Policy. When RHS determines that a borrower is unable or unwilling to meet loan
      obligations, RHS may accelerate the loan and, if necessary, acquire the security property . The
      borrower is responsible for all expenses associated with liquidation and acquisition. If the account
      is satisfied in full, the borrower will be released from liability. If the account is not satisfied
      in full, RHS may pursue any deficiency unless the borrower received a moratorium at any time during
      the life of the loan and faithfully tried to repay the loan.
    drafter_attestation: Verbatim subsection of 7 CFR §3550.211 from Cornell LII snapshot 23e775c48999aadb;
      body isolated between nav and notes; substring-verified.
  judgment: false
- id: usda-7cfr-3550.211-b
  canonical_id: usda-7cfr-3550.211-b
  section: 7 CFR §3550.211(b)
  description: '(b): (b) Tribal allotted or trust land. Liquidations involving a security interest in
    tribal allotted or trust land shall only be pursued after offering to transfer the account to an eligible
    tribal member, the tribe, or the Indian Housing Authority. Forced liquidation of RHS security interests
    in Indian…'
  type: do
  tags:
  - regulator-direct
  - section-complete
  - cfpb-regulation
  primary_source:
    tier: 1
    authority: 7 CFR §3550.211(b)
    source_class: usda-regulation
    source_url: https://www.law.cornell.edu/cfr/text/7/3550.211
    snapshot_id: 23e775c48999aadb
    fetched_at: '2026-05-24T19:34:37Z'
    content_hash: sha256:096116c07c4bda9ba23440b0afd65faee1ed2fbdd9507000c8d35298c5f86105
    paragraph_quote: (b) Tribal allotted or trust land. Liquidations involving a security interest in
      tribal allotted or trust land shall only be pursued after offering to transfer the account to an
      eligible tribal member, the tribe, or the Indian Housing Authority. Forced liquidation of RHS security
      interests in Indian trust lands or on tribal allotted land will be recommended only after the State
      Director has determined it is in the best interest of the Government.
    drafter_attestation: Verbatim subsection of 7 CFR §3550.211 from Cornell LII snapshot 23e775c48999aadb;
      body isolated between nav and notes; substring-verified.
  judgment: false
- id: usda-7cfr-3550.211-c
  canonical_id: usda-7cfr-3550.211-c
  section: 7 CFR §3550.211(c)
  description: '(c): (c) Acceleration and foreclosure. If RHS determines that foreclosure is in the best
    interest of the Government, RHS will send an acceleration notice to each borrower and any cosigner
    .'
  type: do
  tags:
  - regulator-direct
  - section-complete
  - cfpb-regulation
  primary_source:
    tier: 1
    authority: 7 CFR §3550.211(b)
    source_class: usda-regulation
    source_url: https://www.law.cornell.edu/cfr/text/7/3550.211
    snapshot_id: 23e775c48999aadb
    fetched_at: '2026-05-24T19:34:37Z'
    content_hash: sha256:096116c07c4bda9ba23440b0afd65faee1ed2fbdd9507000c8d35298c5f86105
    paragraph_quote: (c) Acceleration and foreclosure. If RHS determines that foreclosure is in the best
      interest of the Government, RHS will send an acceleration notice to each borrower and any cosigner
      .
    drafter_attestation: Verbatim subsection of 7 CFR §3550.211 from Cornell LII snapshot 23e775c48999aadb;
      body isolated between nav and notes; substring-verified.
  judgment: false
- id: usda-7cfr-3550.211-d
  canonical_id: usda-7cfr-3550.211-d
  section: 7 CFR §3550.211(d)
  description: '(d): (d) Voluntary liquidation. Borrowers may voluntarily liquidate through: (1) Refinancing
    or sale. The borrower may refinance or sell the security property for at least net recovery value
    and apply the proceeds to the account. (2) Deed in lieu of foreclosure. RHS may accept a deed in lieu
    of foreclosu…'
  type: do
  tags:
  - regulator-direct
  - section-complete
  - cfpb-regulation
  primary_source:
    tier: 1
    authority: 7 CFR §3550.211(b)
    source_class: usda-regulation
    source_url: https://www.law.cornell.edu/cfr/text/7/3550.211
    snapshot_id: 23e775c48999aadb
    fetched_at: '2026-05-24T19:34:37Z'
    content_hash: sha256:096116c07c4bda9ba23440b0afd65faee1ed2fbdd9507000c8d35298c5f86105
    paragraph_quote: '(d) Voluntary liquidation. Borrowers may voluntarily liquidate through: (1) Refinancing
      or sale. The borrower may refinance or sell the security property for at least net recovery value
      and apply the proceeds to the account. (2) Deed in lieu of foreclosure. RHS may accept a deed in
      lieu of foreclosure to convey title to the security property only after the debt has been accelerated
      and when it is in the Government''s best interest. (3) Offer by third party. If a junior lienholder
      or cosigner makes an offer in the amount of at least the net recovery value , RHS may assign the
      note and mortgage .'
    drafter_attestation: Verbatim subsection of 7 CFR §3550.211 from Cornell LII snapshot 23e775c48999aadb;
      body isolated between nav and notes; substring-verified.
  judgment: false
- id: usda-7cfr-3550.211-e
  canonical_id: usda-7cfr-3550.211-e
  section: 7 CFR §3550.211(e)
  description: '(e): (e) Bankruptcy. (1) When a petition in bankruptcy is filed by a borrower after acceleration
    , collection actions and foreclosure actions are suspended in accordance with the provisions of the
    Bankruptcy Code. (2) RHS may accept conveyance of security property by the trustee in bankruptcy if
    the Bank…'
  type: do
  tags:
  - regulator-direct
  - section-complete
  - cfpb-regulation
  primary_source:
    tier: 1
    authority: 7 CFR §3550.211(b)
    source_class: usda-regulation
    source_url: https://www.law.cornell.edu/cfr/text/7/3550.211
    snapshot_id: 23e775c48999aadb
    fetched_at: '2026-05-24T19:34:37Z'
    content_hash: sha256:096116c07c4bda9ba23440b0afd65faee1ed2fbdd9507000c8d35298c5f86105
    paragraph_quote: (e) Bankruptcy. (1) When a petition in bankruptcy is filed by a borrower after acceleration
      , collection actions and foreclosure actions are suspended in accordance with the provisions of
      the Bankruptcy Code. (2) RHS may accept conveyance of security property by the trustee in bankruptcy
      if the Bankruptcy Court has approved the transaction, RHS determines the conveyance is in the best
      interest of the Government, and RHS will acquire title free of all liens and encumbrances except
      RHS liens. (3) Whenever possible in a Chapter 7 Bankruptcy, a reaffirmation agreement will be signed
      by the borrower and approved by the court prior to discharge, if RHS decides to continue with the
      borrower .
    drafter_attestation: Verbatim subsection of 7 CFR §3550.211 from Cornell LII snapshot 23e775c48999aadb;
      body isolated between nav and notes; substring-verified.
  judgment: false
- id: usda-7cfr-3550.211-f
  canonical_id: usda-7cfr-3550.211-f
  section: 7 CFR §3550.211(f)
  description: '(f): (f) Junior lienholder foreclosure. When a junior lienholder foreclosure does not
    result in payment in full of the RHS debt but the property is sold subject to the RHS lien, RHS may
    liquidate the account unless the new owner is eligible to assume the RHS debt and actually assumes
    the RHS debt.'
  type: do
  tags:
  - regulator-direct
  - section-complete
  - cfpb-regulation
  primary_source:
    tier: 1
    authority: 7 CFR §3550.211(b)
    source_class: usda-regulation
    source_url: https://www.law.cornell.edu/cfr/text/7/3550.211
    snapshot_id: 23e775c48999aadb
    fetched_at: '2026-05-24T19:34:37Z'
    content_hash: sha256:096116c07c4bda9ba23440b0afd65faee1ed2fbdd9507000c8d35298c5f86105
    paragraph_quote: (f) Junior lienholder foreclosure. When a junior lienholder foreclosure does not
      result in payment in full of the RHS debt but the property is sold subject to the RHS lien, RHS
      may liquidate the account unless the new owner is eligible to assume the RHS debt and actually assumes
      the RHS debt.
    drafter_attestation: Verbatim subsection of 7 CFR §3550.211 from Cornell LII snapshot 23e775c48999aadb;
      body isolated between nav and notes; substring-verified.
  judgment: false
- id: usda-7cfr-3550.211-g
  canonical_id: usda-7cfr-3550.211-g
  section: 7 CFR §3550.211(g)
  description: '(g): (g) Payment subsidy. If the borrower is receiving payment subsidy , the payment subsidy
    agreement will not be canceled when the debt is accelerated, but will not be renewed unless the account
    is reinstated.'
  type: do
  tags:
  - regulator-direct
  - section-complete
  - cfpb-regulation
  primary_source:
    tier: 1
    authority: 7 CFR §3550.211(b)
    source_class: usda-regulation
    source_url: https://www.law.cornell.edu/cfr/text/7/3550.211
    snapshot_id: 23e775c48999aadb
    fetched_at: '2026-05-24T19:34:37Z'
    content_hash: sha256:096116c07c4bda9ba23440b0afd65faee1ed2fbdd9507000c8d35298c5f86105
    paragraph_quote: (g) Payment subsidy. If the borrower is receiving payment subsidy , the payment subsidy
      agreement will not be canceled when the debt is accelerated, but will not be renewed unless the
      account is reinstated.
    drafter_attestation: Verbatim subsection of 7 CFR §3550.211 from Cornell LII snapshot 23e775c48999aadb;
      body isolated between nav and notes; substring-verified.
  judgment: false
- id: usda-7cfr-3550.211-h
  canonical_id: usda-7cfr-3550.211-h
  section: 7 CFR §3550.211(h)
  description: '(h): (h) Eligibility for special servicing actions. A borrower is not eligible for special
    servicing actions once the account has been accelerated.'
  type: do
  tags:
  - regulator-direct
  - section-complete
  - cfpb-regulation
  primary_source:
    tier: 1
    authority: 7 CFR §3550.211(b)
    source_class: usda-regulation
    source_url: https://www.law.cornell.edu/cfr/text/7/3550.211
    snapshot_id: 23e775c48999aadb
    fetched_at: '2026-05-24T19:34:37Z'
    content_hash: sha256:096116c07c4bda9ba23440b0afd65faee1ed2fbdd9507000c8d35298c5f86105
    paragraph_quote: (h) Eligibility for special servicing actions. A borrower is not eligible for special
      servicing actions once the account has been accelerated.
    drafter_attestation: Verbatim subsection of 7 CFR §3550.211 from Cornell LII snapshot 23e775c48999aadb;
      body isolated between nav and notes; substring-verified.
  judgment: false
- id: usda-7cfr-3550.211-i
  canonical_id: usda-7cfr-3550.211-i
  section: 7 CFR §3550.211(i)
  description: '(i): (i) Reporting. RHS may report to IRS and credit reporting agencies any debt settled
    through liquidation. [ 61 FR 59779 , Nov. 22, 1996, as amended at 67 FR 78332 , Dec. 24, 2002] CFR
    Toolbox Law about... Articles from Wex Table of Popular Names Parallel Table of Authorities Accessibility
    About LII C…'
  type: do
  tags:
  - regulator-direct
  - section-complete
  - cfpb-regulation
  primary_source:
    tier: 1
    authority: 7 CFR §3550.211(b)
    source_class: usda-regulation
    source_url: https://www.law.cornell.edu/cfr/text/7/3550.211
    snapshot_id: 23e775c48999aadb
    fetched_at: '2026-05-24T19:34:37Z'
    content_hash: sha256:096116c07c4bda9ba23440b0afd65faee1ed2fbdd9507000c8d35298c5f86105
    paragraph_quote: (i) Reporting. RHS may report to IRS and credit reporting agencies any debt settled
      through liquidation. [ 61 FR 59779 , Nov. 22, 1996, as amended at 67 FR 78332 , Dec. 24, 2002] CFR
      Toolbox Law about... Articles from Wex Table of Popular Names Parallel Table of Authorities Accessibility
      About LII Contact us Advertise here Help Terms of use Privacy
    drafter_attestation: Verbatim subsection of 7 CFR §3550.211 from Cornell LII snapshot 23e775c48999aadb;
      body isolated between nav and notes; substring-verified.
  judgment: false
