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& 773

§ 773a

banks to be loaned to its members shall, at the option of the bank, be in current funds or Federal Farm Mortgage Corporation bonds, or, at the option of the borrower, in farm loan bonds. (July 17, 1916, c. 245, § 12, 39 Stat. 370; Jan. 31, 1934, c. 7, § 7, 48 Stat. 346.)

Mortgages on farm lands under United States reclamation projects.-The term "first mortgages", as used in section 771 of this title, shall be construed to include mortgages on farm lands under United States reclamation projects, notwithstanding there may be against such lands a reserved or created lien in favor of the United States for construction or other charges as provided in sections 372, 381, 383, 391, 392, 411, 416, 419, 421, 431, 432, 434, 439, 461, 476, 491, 498 of Title 43 [U. S. Code], Public Lands, and acts amendatory thereof and supplementary thereto, known as the reclamation law: Provided, That such lands are otherwise eligible for loans under this subchapter: And provided further, That the amount and date of maturity of such lien shall be given due consideration in fixing the value of such lands for loan purposes. (May 15, 1922, c. 190, § 3, 42 Stat. 542.)

Loans on lands in drainage, irrigation, or conservancy districts.-The Farm Credit Administration, the Federal Farm Mortgage Corporation, the Federal land banks, the Land Bank Commissioner, and any lending or financing agency established by or under subchapters I, III, IV and V of this chapter, are authorized to make loans or acquire mortgages on lands in any drainage, irrigation, or conservancy district, notwithstanding the existence of any prior lien or charge arising out of an assessment for special benefits made by such district, in any case where (1) such land is otherwise eligible for a loan, (2) such assessment is payable over a period of years, and (3) reasonable security exists for the repayment of the loan, taking into consideration all facts and values, including the term and size of the loan, the integrity of the applicant, and the increased earning capacity of the lands arising from the improvements or benefits in respect of which the assessment was made. (June 4, 1936, c. 496, 49 Stat. 1461.)

§ 781

POWERS OF FEDERAL LAND BANKS GENERALLY

Enumerated powers.-Every Federal land bank shall have power, subject to the limitations and requirements of this subchapter—

First. Issuing and selling farm loan bonds.-To
issue, subject to the approval of the Farm Credit
Administration, and to sell farm loan bonds of the
kinds authorized in this subchapter, to buy the same
for its own account, and to retire the same at or be-
fore maturity. (July 17, 1916, c. 245, § 13, 39 Stat.
372; Mar. 27, 1933, Ex. Or. 6084.)

Second. Investing funds in first farm mort-
gages. To invest such funds as may be in its pos-
session in the purchase of qualified first mortgages
on farm lands situated within the farm credit dis-
trict within which it is organized or for which it is
acting. In order to reduce and/or refinance farm
mortgages, to invest such funds as may be in its
possession in the purchase of first mortgages on
farm lands situated within the farm credit district
within which it is organized or for which it is act-
ing, or to exchange farm loan bonds for any duly re-
corded first mortgages on farm lands executed prior
to May 12, 1933, at a price which shall not exceed in
each individual case the amount of the unpaid prin-
cipal of the mortgage on the date of such purchase
or exchange, or 50 per centum of the normal value of
the land mortgaged and 20 per centum of the value
of the permanent insured improvements thereon as
determined upon an appraisal made pursuant to this
subchapter, whichever is the smaller: Provided,
That any mortgagor whose mortgage is acquired by
a Federal land bank under this paragraph shall be
entitled to have his farm mortgage indebtedness re-
financed in accordance with the provisions of sec-
tions 711-723 and 731-734 of this title, on the
basis of the amount paid by the bank for his mort-
gage. (July 17, 1916, c. 245, § 13, 39 Stat. 372; May
12, 1933, c. 25, § 22, 48 Stat. 42; Aug. 19, 1937, c. 704,
§ 5 (a), 50 Stat. 704.)

Third. Receipt and deposit of mortgages as col-
lateral for bonds; collection of moneys payable
under mortgages and bonds.-To receive and to de-
posit in trust with the farm loan registrar for the
district, to be by him held as collateral security for
farm loan bonds, first mortgages upon farm land
qualified under section 771 of this title, and to em-
power national farm loan associations, or duly au-
thorized agents, to collect and immediately pay over
to said land banks the dues, interest, amortization in-

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stallments and other sums payable under the terms,
conditions, and covenants of the mortgages and of
the bonds secured thereby. (July 17, 1916, c. 245,
§ 13, 39 Stat. 372.)

Fourth. Acquiring and disposing of property.-
To acquire and dispose of—

(a) Such property, real or personal, as may
be necessary or convenient for the transaction
of its business, which, however, may be in part
leased to others for revenue purposes.

(b) Parcels of land acquired in satisfaction of debts or purchased at sales under judgments, decrees, or mortgages held by it. But no such bank shall hold title and possession of any real estate purchased or acquired to secure any debt due to it, for a longer period than 5 years, except with the special approval of the Farm Credit Administration in writing. Every such bank may carry real estate as an asset, for a period of not exceeding 5 years, at its normal value but not to exceed the amount of the bank's investment therein at the time of acquirement of such real estate. (July 17, 1916, c. 245, § 13, 39 Stat. 372; Mar. 4, 1933, c. 270, § 3, 47 Stat. 1548; Mar. 27, 1933, Ex. Or. 6084.)

Fifth. Depositing securities and funds with reserve banks. To deposit its securities and its current funds subject to check, with any member bank of the Federal Reserve System, and to receive interest on the same as may be agreed. (July 17, 1916, c. 245, § 13, 39 Stat. 372.)

Sixth. Receiving deposits from associations.-To accept deposits of securities or of current funds from national farm loan associations holding its shares, but to pay no interest on such deposits. (July 17, 1916, c. 245, § 13, 39 Stat. 372.)

Seventh. Borrowing money.-To borrow money, to give security therefor, and to pay interest thereon. (July 17, 1916, c. 245, § 13, 39 Stat. 372.)

Eighth. Buying and selling bonds of United States and Federal Farm Mortgage Corporation.To buy and sell United States bonds and Federal Farm Mortgage Corporation bonds. (July 17, 1916, c. 245, § 13, 39 Stat. 372; Aug. 19, 1937, c. 704, § 15 (a), 50 Stat. 708.)

Ninth. Charging fees for loans.-To charge applicants for loans and borrowers, under rules and regulations promulgated by the Farm Credit Administration, reasonable fees not exceeding the actual cost of appraisal and determination of title. Legal fees and recording charges imposed by law in

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§ 781

the State where the land to be mortgaged is located
may also be included in the preliminary costs of
negotiating mortgage loans. The borrower may

pay such fees and charges or he may arrange with
the Federal land bank making the loan to advance
the same, in which case said expenses shall be made
a part of the face of the loan and paid off in amor-
tization payments. Such addition to the loan shall
not be permitted to increase said loan above the
limitations provided in section 771 of this title.
(July 17, 1916. c. 245, § 13, 39 Stat. 372; Mar. 27,
1933, Ex. Or. 6084.)

Tenth. Extension of obligations unpaid under
terms of mortgages.-When in the judgment of the
directors conditions justify it, to extend, in whole
or in part, any obligation that may be or become
unpaid under the terms of any mortgage, and to
accept payment of any such obligation during a
period of five years or less from the date of such
extension in such amounts as may be agreed upon
at the date of making such extension. The sum of
$25,000,000 of the amount authorized to be appro-
priated under section 698 of this title shall be used
exclusively for the purpose of supplying any bank
with funds to use in its operations in place of any
amounts of which such bank may be deprived by
reason of extensions made as provided in this para-
graph. The terms of any such extension shall be
such as will not defer the collection of any obligation
due by any borrower which, after investigation by
the bank of the situation of such borrower, is shown
to be within his capacity to meet. In the case of
any such extension, or in the case of any deferment
of principal as provided in paragraph "Twelfth"
of section 771 of this title, it shall be the duty of the
Secretary of the Treasury, on behalf of the United
States, upon the request of the Federal land bank
making the extension, and with the approval of the
Land Bank Commissioner, to subscribe at such peri-
ods as the Commissioner shall determine, to the
paid-in surplus of such bank an amount equal to the
amount of all such extensions and deferments made
by the bank during the preceding period. Such
subscriptions shall be subject to call, in whole or in
part, by the bank with the approval of the Com-
missioner upon thirty days' notice. To enable the
Secretary of the Treasury to make such subscrip-
tions to the paid-in surplus of the Federal land
banks, there is hereby authorized to be appropriated
the sum of $50,000,000, to be immediately available
and remain available until expended. Upon pay-

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$ 781

ment to any Federal land bank of the amount of
any such subscription, such bank shall execute and
deliver a receipt therefor to the Secretary of the
Treasury in form to be prescribed by the Land Bank
Commissioner. The amount of any subscriptions to
the paid-in surplus of any such bank may be repaid
in whole or in part at any time in the discretion of
the bank and with the approval of the Land Bank
Commissioner, and the Commissioner may at any
time require such subscriptions to be repaid in whole
or in part if in his opinion the bank has resources
available therefor. The unexpended balances of the
funds appropriated by the Fourth Deficiency Act,
fiscal year 1933, approved June 16, 1933 (48 Stat.
279), the Emergency Appropriation Act, fiscal year
1935, approved June 19, 1934 (48 Stat. 1060), the
Second Deficiency Appropriation Act, fiscal year
1935, approved August 12, 1935 (49 Stat. 592), the
First Deficiency Appropriation Act, fiscal year 1936,
approved June 22, 1936 [49 Stat. 1597], the Treasury
Department Appropriation Act, 1937, approved
June 23, 1936 [49 Stat. 1827], and the Treasury De-
partment Appropriation Act, 1938, approved May
14, 1937 [50 Stat. 137], for the purpose of enabling
the Secretary of the Treasury to make subscriptions
to the paid-in surplus of the Federal land banks, as
provided for in this paragraph, and the proceeds
of all repayments on account of such paid-in surplus,
shall be held in the Treasury of the United States as
a revolving fund and shall be available for subscrip-
tions to paid-in surplus made pursuant to this para-
graph. (July 17, 1916, c. 245 § 13, 39 Stat. 372;
Jan. 23, 1932, c. 9, § 5, 47 Stat. 14; May 12, 1933,
c. 25, § 23, 48 Stat. 43; June 16, 1933, c. 98, § 80 (a),
48 Stat. 273; Aug. 19, 1937, c. 704, § 19, 50 Stat. 709.)
For interest rate on extended payments, see paragraph
"Twelfth" of this section.

Eleventh. Postponement of payment of installments of loans. At any time within five years after March 4, 1933, any borrower who has obtained a loan from a Federal land bank may on application to such Federal land bank and upon approval of such application by the directors of the bank postpone the payment of any unpaid installment or installments in the manner herein provided in this section. Such postponed payment shall be made by paying at the time each succeeding annual installment is due, one-tenth of the amount of the postponed payment, and, in the case of semiannual installments, by paying at the time each succeeding

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