| (a) Definitions. The following words and terms when used in this section shall have the following meanings, unless the context clearly indicates otherwise: (1) Account--The loan account a borrower holds with the Veterans Land Board. The account includes the obligations between the borrower and the board as evidenced by contracts and documents in the borrower's loan file as well as the accounting records of the board. This includes the amount of the unpaid principal balance of the loan, any administrative costs made a part of the loan, unpaid interest, and any delinquent amount. (2) Borrower--The person presently obligated to make the loan installment payments set forth in the contract, including the purchaser at a forfeited land sale or the last board-approved assignee of the original veteran purchaser. (3) Contract--The contract of sale and purchase between the board and a borrower. (4) Current--The account is in good standing with no installments past due. (5) Delinquent amount--The total amount needed to bring an account current. This includes all past due installments, administrative costs made part of such past due installments, and all accrued delinquent interest or penalty on all such past due installments. Delinquent interest or penalty shall accrue on any delinquent amount as set by the board from time to time by resolution. (6) Forfeiture--The action by which the board declares a borrower to be in breach of his or her contract by virtue of failing to perform a material term of the contract, including, but not limited to, timely payment of the loan installments. (7) Installment--The amount of the periodic loan payment specified by the contract. (8) Partial Payment Agreement--A borrower's written agreement to clear the delinquent amount on or before a designated date by making payments in addition to the installment amount on scheduled dates as described in the agreement. (9) Delinquent interest--The interest or penalty which accrues on a loan installment which has become delinquent. The delinquent interest rate or penalty shall be set by the board from time to time by resolution (10) Reinstatement penalty--The amount charged to a borrower (whose contract has been forfeited by the board) in order to reinstate the contract. The reinstatement penalty is in addition to the amount necessary to bring the account current. (A) Beginning on the date of the first and any second forfeiture of the contract, each unpaid delinquent installment (of principal and interest combined) will accrue a reinstatement penalty in an amount equal to 1.5 percent per month (or 18 percent per year), until the contract is reinstated. (B) Beginning on the date of the third instance and any subsequent forfeiture of the contract, the outstanding principal balance of the contract will accrue a reinstatement penalty in an amount equal to 1.5 percent per month (or 18 percent per year), less the accrued delinquent interest, until the contract is reinstated. (11) Sale order date--The date on which the board meets to order a tract advertised for sale, or for lease for mineral development. (b) Delinquencies. (1) If a scheduled loan installment is not received by the board within the time allotted by the board, the account becomes delinquent. Any payments received on an account shall be first applied to the delinquent amount. The account continues in a delinquent status until the full amount of the delinquent amount has been received by the board. (2) A partial payment agreement may be granted at the discretion of the chairman at any time prior to the date an account is forfeited. From time to time, the board may, by resolution, set guidelines for other conditions under which partial payment agreements may be approved. (c) Forfeiture. (1) The board is the sole judge whether any contract has been forfeited. An account shall become eligible for forfeiture if: (A) it remains in a delinquent status for 30 or more consecutive days; or, (B) the contract has been transferred without obtaining the board's permission; or, (C) property taxes for all prior years shall not have been paid by May 1 of any year; or, (D) the provisions of the Natural Resources Code, Chapter 161, the terms of the contract, or the rules of the board are not satisfied. (2) The board must give 30 days written notice to the borrower, the original veteran purchaser (if different from the borrower) and all board approved assignees of the original veteran purchaser, if any, and must specify the reason why the contract is subject to forfeiture. This notice will be sent by certified mail to the last known address of these parties. If the reason for forfeiture is cured or corrected within 30 days the board shall not declare a forfeiture. (3) The liability of the original veteran purchaser and any subsequent assignee or assignees is joint and several, but the original veteran purchaser is primarily liable for payment of the money under the contract. The board may release any assignor from liability if the assignor requests the release in writing and at least 3 years have passed since the assignment was approved and the assignee has paid the account in a manner acceptable to the board. (4) A forfeiture shall be effective at the same time the board meets and adopts a resolution forfeiting the contract. At that time, the land and all payments previously made are forfeited. (5) When the forfeiture is effective, the full title to the land shall revest in the board. Any interest in the mineral estate which the board acquired at purchase shall likewise revest in the board. The board shall recognize, and continue in force and effect, any outstanding valid oil, gas, or mineral lease and collect all rentals, royalties, or other amounts payable under the lease. The board may also lease the land on terms it considers proper. The proceeds received from a lease on a forfeited tract shall be credited to the Veterans Land Fund; however, the chairman is authorized to credit any portion of the lease proceeds to the delinquent amount and unpaid principal of a loan as part of a borrower's attempt to reinstate his or her contract. (d) Reinstatement. (1) From time to time, the board by resolution may set additional guidelines and reasonable requirements which must be satisfied before reinstatement may be granted (e.g., evidence that there are no delinquent taxes due as of the date and time of reinstatement, etc.). (2) The borrower, the original veteran purchaser (if different from the borrower) and all board approved assignees may reinstate the contract at any time before the sale order date if the reason for forfeiture was failure to keep the account current. If the contract was forfeited for any other reason, the board in its discretion may determine there is no right to reinstate the contract. (A) Any person wishing to exercise a right of reinstatement shall submit to the board payment of the delinquent amount, the reinstatement penalty and other costs incident to the reinstatement as prescribed by the board. (i) If there is only one person who has a right to reinstate a contract (there having been no board approved assignments of the contract), or if the last approved assignee requests reinstatement, the chairman of the board may in his or her discretion reinstate the contract immediately upon receipt of payment of the delinquent amount, the reinstatement penalty and other costs prescribed by the board. (ii) If two or more persons, other than the last approved assignee, appear to have a right to reinstate the same contract, reinstatement shall not be granted prior to the time the board meets on the sale order date. In this event, all persons wishing to reinstate the same contract are required to submit to the board payment of the delinquent amount, reinstatement penalty and other costs prescribed by the board. Any person failing to satisfy this requirement by the sale order date may, in the chairman of the board's discretion, be deemed to have failed to exercise his or her right to reinstate the contract. Any monies and documents submitted by such persons shall be returned. If on the order for sale date, there are still two or more persons who have satisfied the requirements to reinstate the same contract, the chairman of the board may, in his or her discretion, reinstate the contract in the name of the person that has complied with the board's requirements for reinstatement and was most recently approved by the board as a purchaser or an assignee. (B) A person who desires to reinstate a contract but is unable to submit full payment of the delinquent amount before the anticipated sale order date, may petition the chairman to postpone the sale order date for the tract. The chairman in his or her sole discretion may grant or deny such a petition. (i) In granting such a petition, the chairman may set reasonable conditions which must be satisfied by a stated deadline. Such conditions may include, but are not limited to, the requirement that the requesting party enter into a partial payment agreement. Cont'd... |
