FSA-2062 Application for subordination of security for commercial

OMB Approval #
Expiration Date
U.S. DEPARTMENT OF AGRICULTURE
Farm Service Agency

FSA-2062
(proposal 5)

Position 5

APPLICATION FOR SUBORDINATION OF SECURITY FOR COMMERCIAL CREDIT

PART A - BORROWER REQUEST
1. The undersigned (a)
("Borrower") in accordance with the terms of the security instruments now held by the United States, acting through
U.S. Department of Agriculture, Farm Service Agency (called "Government") on the property, applies for a subordination.
(b) Name of lender receiving proposed subordination

(c) Amount of subordination requested

(d) Proceeds from the subordination will be used as follows:

(e) Legal description of security to be subordinated (attach description if more space needed)

2. For security to be subordinated, name of lienholder, approximate amount of each lien, including FSA in the order of lien priority:
A. Security

Initials:

B. Name of Lienholder(s)

Date:

C. Approximate Amount of
Lien ($)

D. Lien Priority

FSA-2062 (proposal 5)

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2. For security to be subordinated, name of lienholder, approximate amount of each lien, including FSA in the order of lien priority:
(Continuation)
A. Security

B. Name of Lienholder(s)

C. Approximate Amount of
Lien ($)

D. Lien Priority

3. Complete application for subordination of FSA security to a commercial lender:
With subordinations, FSA and the lender essentially partner in providing joint financing to you and share applicable financial and
loan information.
FSA may accept the following items from you, or directly from the lender who may submit documents on your behalf, to support
subordination requests using this form:
written request or confirmation (e-mail) from the lender detailing the loan rate, term, purposes, security requirements,
and what the lender specifically needs from FSA
current financial statement from the borrower and all entity members or FSA-2037(s)
the farm's operating plan, including a projected cash flow budget reflecting production, income, expenses, and debt
repayment plan or FSA-2038
loan agreements or other documentation outlining the approval, loan advance, and closing requirements
copies of appraisals used by the lender (if necessary, FSA may obtain its own appraisal)
copies of any construction and/or environmental documents, title opinions, and/or lien search used by the lender
copy of credit report used by the lender. FSA will order credit report for you if necessary

verification of nonfarm income such as 2 recent earning statements or last year's tax forms
AD-1026
Initials:

Date:

FSA-2062 (proposal 5)

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PART B - NOTIFICATIONS, CERTIFICATIONS AND ACKNOWLEDGMENT
YES
1.
2.
3.
4.
5.
6.

NO

Are you currently or have you ever, and in the case of an entity any member of the entity, conducted business
under any other name? If "YES," list names in Item 10.
Have you ever, or in the case of an entity any member of the entity, obtained a direct or guaranteed farm loan
from FSA or Farmers Home Administration?
If Item 2 is "YES," did you receive any debt forgiveness through write-down, write-off, compromise, adjustment,
reduction, charge-off, paying a loss on a guarantee, or bankruptcy? If "YES," provide details in Item 10.
Are you, or in the case of an entity any member of the entity, delinquent on any Federal debt or have any
outstanding Federal judgments? If "YES," provide details in Item 10.
Are you, or in the case of an entity any member of the entity, involved in any pending litigation? If "YES,"
provide details in Item 10.
Have you, or in the case of an entity any member of the entity, ever been in receivership, discharged in
bankruptcy, or filed a petition for reorganization in bankruptcy? If "YES," provide details in Item 10.

7.

Are you, or in the case of an entity any member of the entity, an FSA employee or related to or closely
associated with an FSA employee? If "YES," provide details in Item 10.

8.

Are you now or have you ever, operated a farm? If "YES," provide number of years and details in Item 10.

9.

Have you, or any entity members if applicable, ever been: (If "YES", provide details in Item 10)
(a) Convicted under any Federal or State law of planting, cultivating, growing, producing, harvesting, or storing
a controlled substance within the previous 5 crop years? (See the Food Security Act of 1985, Pub. Law.
99-198)
(b) Determined ineligible for Federal benefits based on a conviction for the distribution of controlled
substances or any offense involving the possession of a controlled substance under 21 U.S.C. 862?
(c) Determined ineligible for Federal benefits based on Federal Crop Insurance Corporation fraud? (See 7
U.S.C. 1515)

10. Additional answers. Write the Item number to which each answer applies. If you need additional space, use sheets of paper
the same size as this page and write the applicant's name on each additional sheet.

11. SPECIAL PROGRAM INFORMATION.
Certain FSA programs are, by law, designed to reach targeted applicants. If you are interested in any of the programs
described here or have questions about these programs and whether you may qualify for a specific program, the FSA office
processing your application will help you.
A. SOCIALLY DISADVANTAGED APPLICANTS: A portion of FSA farm ownership, operating, and conservation loan funds
are, by law, targeted to applicants who have been subjected to racial, ethnic or gender prejudice because of their identity
as a member of a group, without regard to individual qualities. Under the applicable law, groups meeting this condition are:
American Indians/Alaskan Natives, Asians, Blacks or African Americans, Native Hawaiians/Other Pacific Islanders,
Hispanics and women. In addition, FSA has a down payment program, which receives special funding.
B. BEGINNING FARMER ASSISTANCE: FSA has the authority to assist beginning farmers through the farm ownership,
operating, and conservation loan programs. A portion of FSA farm ownership, operating, and conservation loan funds are,
by law, targeted to beginning farmers. In addition, FSA has a down payment program, which receives special funding. In
some States, FSA has agreements with State beginning farmer programs to help meet the credit needs of beginning
farmers.
C. LIMITED RESOURCE LOANS: Limited resource farm ownership and operating loans are available to qualified applicants.
This program provides loans at reduced interest rates to low-income farmers whose operations and resources are so
limited that they cannot pay the regular rates for FSA loans. The program is also intended to provide beginning farmers
the opportunity to start a successful farming operation.

Initials:

Date:

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PART B - NOTIFICATIONS, CERTIFICATIONS AND ACKNOWLEDGMENT (Continuation)
12. RIGHTS AND POLICIES.
A. RIGHT TO FINANCIAL PRIVACY ACT OF 1978 (Public Law 95-630): FSA has a right of access to financial records
held by financial institutions in connection with providing assistance to you as well as collecting on loans made to you or
guaranteed by the Government. Financial records involving your transaction will be available to FSA without further
notice or authorization but will not be disclosed or released by this institution to another Government Agency or
Department without your consent except as required by law.
B. THE FEDERAL EQUAL CREDIT OPPORTUNITY ACT: Prohibits creditors from discriminating against applicants on the
basis of race, color, religion, sex, national origin, marital status, age (provided the applicant has the capacity to enter into
a binding contract), because all or a part of the applicant's income derives from any public assistance program, or
because the applicant has in good faith exercised any right under the Consumer Credit Protection Act.
C. FEDERAL COLLECTION POLICIES: Delinquencies, defaults, foreclosures and abuses of loans involving programs of
the Federal Government can be costly and detrimental to your credit, now and in the future. The lender in this
transaction, its agents and assigns as well as the Federal Government, its agencies, agents and assigns, are authorized
to take any and all of the following actions in the event loan payments become delinquent: (1) Report your name and
account information to a credit bureau; (2) Assess additional interest and penalty charges for the period of time that
payment is not made; (3) Assess charges to cover additional administrative costs incurred by the Government to service
your account; (4) Offset amounts owed to you under other Federal programs; (5) Refer your account to a private attorney,
collection agency or mortgage servicing agency to collect the amount due, foreclose the mortgage, sell the property and
seek judgment against you for any deficiency; (6) Refer your account to the Department of Justice for litigation; (7) Take
action to offset your salary, or retirement benefits; (8) Refer your debt to the Department of the Treasury for crossservicing and offset against any amount owed to you by any Federal Agency such as an income tax refund; and (9)
Report any resulting written-off debt to the Internal Revenue Service as taxable income. All of these actions can and will
be used to recover debts owed to the Federal Government when in its best interests.
13. RESTRICTIONS AND DISCLOSURE OF LOBBYING ACTIVITIES:
A. The applicant:
(1) Certifies that if any funds, by or on behalf of the applicant, have been or will be paid to any person for influencing or
attempting to influence an officer or employee of any agency, a Member, an officer or employee of Congress, or an
employee of a Member of Congress in connection with the awarding of any Federal contract, the making of any
Federal grant or Federal loan, and the extension, continuation, renewal, amendment, or modification of any Federal
contract, grant, or loan, the applicant shall complete and submit Standard Form - LLL, "Disclosure of Lobbying
Activities," in accordance with its instructions.
(2) Shall require that the language of this certification be included in the award documents for all sub-awards at all tiers
(including contracts, subcontracts, and subgrants, under grants and loans) and that all subrecipients shall certify and
disclose accordingly.
B. This certification is a material representation of fact upon which reliance was placed when this transaction was made or
entered into. Submission of this statement is a prerequisite for making or entering into this transaction. Any person who
fails to file the required statement shall be subject to a civil penalty imposed by 31 U.S.C. 1352.
14. DISQUALIFICATION DUE TO FEDERAL CROP INSURANCE FRAUD:

The applicant certifies that as an individual or any member of the entity, has not been disqualified for Federal benefits as
provided in Section 515(h) of the Federal Crop Insurance Act (FCIA). Applicants who willfully and intentionally provide false
or inaccurate information to the Federal Crop Insurance Corporation (FCIC) or to an approved insurance provider with
respect to a policy or plan of FCIC insurance, after notice and an opportunity for a hearing on the record, will be subject to
one or more of the sanctions described in section 515(h)(3) of FCIA.
15. PERMISSION TO FILE FINANCING STATEMENT:
Under the Uniform Commercial Code, you do not have to sign the financing statement which allows FSA to obtain a security
interest in your property. If the loan is approved and funded, FSA will file a financing statement at the earliest possible date,
before you enter into a SECURITY AGREEMENT. BY SIGNING BELOW, I GIVE FSA PERMISSION TO FILE A
FINANCING STATEMENT PRIOR TO THE EXECUTION OF THE SECURITY AGREEMENT AS WELL AS TO FILE
AMENDMENTS AND CONTINUATIONS OF THE FINANCING STATEMENT THEREAFTER.
Initials:
Date:

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PART C - CERTIFICATION AND SIGNATURES
I understand that until FSA executes a separate written instrument for subordination FSA's approval of this application will merely
constitute and evidence FSA's consent, as lienholder, to the proposed transaction without in any way subordinating its liens, modifying the
payment terms of my loans, or otherwise affect any FSA rights. If this application is approved, I agree to comply with such terms as may
be set by FSA and to dispose of the proceeds as required.
I agree that none of the funds obtained as a result of this subordination will be used for a purpose that will contribute to excessive erosion
of highly erodible land or the conversion of wetlands to produce an agriculture commodity as provided in 7 CFR part 12 or will adversely
affect compliance with any of the environmental requirements of 7 CFR part 799.
The statements and representations made above are made in connection with the request for a subordination of the loan security. The
making of any false statement or misrepresentations herein may be a crime punishable under the Title 18 U.S.C. 1001. I certify that the
statements made are true, complete, and correct to the best of my knowledge and belief. Note: Whoever signs below should also initial and
date each preceding page. Additional pages should be added for additional signatures if needed.
1A. Signature of Individual Applicant, Spouse or Entity Member
1B. Capacity
1C. Date
(MM/DD/YYYY)

Self
Entity Respresentative
2A. Signature of Individual Applicant, Spouse or Entity Member

2B. Capacity

2C. Date
(MM/DD/YYYY)

Self
3A. Signature of Individual Applicant, Spouse or Entity Member

Entity Respresentative
3B. Capacity

3C. Date
(MM/DD/YYYY)

Self
4A. Signature of Individual Applicant, Spouse or Entity Member

Entity Respresentative
4B. Capacity

4C. Date
(MM/DD/YYYY)

Self
5A. Signature of Individual Applicant, Spouse or Entity Member

Entity Respresentative
5B. Capacity

5C. Date
(MM/DD/YYYY)

Self
6A. Signature of Individual Applicant, Spouse or Entity Member

Entity Respresentative
6B. Capacity

6C. Date
(MM/DD/YYYY)

Self
Entity Respresentative

PART D - FSA USE ONLY
1. Date FSA-2062 Received

2. Date Application Complete

3. Comments on recommendation and approval or denial of the subordination have been entered in FBP credit presentation titled
(a)

and dated: (b)

. The transaction was approved or rejected in the FBP.

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NOTE: Privacy Act Statement: The following statement is made in accordance with the Privacy Act of 1974 (5 USC 552a - as amended).
The authority for requesting the information identified on this form is 7 CFR Part 764, 7 CFR Part 765, the Consolidated Farm and
Rural Development Act (7 U.S.C. 1921 et seq.), and the Agricultural Act of 2014 (Pub. L. 113-79). The information will be used to
determine borrower eligibility for the requested FSA Farm Loan Programs action. The information collected on this form may be
disclosed to other Federal, State, Local government agencies, Tribal agencies, and nongovernmental entities that have been
authorized access to the information by statute or regulation and/or as described in applicable Routine Uses identified in the System
of Records Notice for USDA/FSA-14, Applicant/Borrower. Providing the requested information is voluntary. However, failure to
furnish the requested information may result in a denial of the requested FSA Farm Loan Programs action.
Public Burden Statement (Paperwork Reduction Act): According to the Paperwork Reduction Act of 1995, an agency may not
conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid OMB control
number. The valid OMB control number for this information collection is 0560-0236. The time required to complete this information
collection is estimated to average 30 minutes per response, including the time for reviewing instructions, searching existing data
sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. The provisions of
criminal and civil fraud, privacy, and other statutes may be applicable to the information provided.
Non-Discrimination Statement: In accordance with Federal civil rights law and USDA civil rights regulations and policies, the
USDA, its agencies, offices, and employees participating in or administering USDA programs are prohibited from discriminating based
on race, color, national origin, religion, sex, gender identity (including gender expression), sexual orientation, disability, age, marital
status, family/parental status, income derived from a public assistance program, political beliefs, or reprisal or retaliation for prior civil
rights activity, in any program or activity conducted or funded by USDA (not all bases apply to all programs). Remedies and complaint
filing deadlines vary by program or incident.
Persons with disabilities who require alternative means of communication for program information (e.g., Braille, large print, audiotape,
American Sign Language, etc.) should contact the responsible agency or USDA's TARGET Center at (202) 720-2600 (voice and TTY)
or contact USDA through the Federal Relay Service at (800) 877-8339. Additionally, program information may be made available in
languages other than English.
To file a program discrimination complaint, complete the USDA Program Discrimination Complaint Form, AD-3027, found online at
http://www.ascr.usda.gov/complaint_filing_cust.html and at any USDA office or write a letter addressed to USDA and provide in the
letter all of the information requested in the form. To request a copy of the complaint form, call (866) 632-9992. Submit your
completed form or letter to USDA by: (1) mail: U.S. Department of Agriculture Office of the Assistant Secretary for Civil Rights 1400
Independence Avenue, SW Washington, D.C. 20250-9410; (2) fax: (202) 690-7442; or (3) email: [email protected]. USDA is
an equal opportunity provider, employer, and lender.