106 STAT. 4156 PUBLIC LAW 102-554—OCT. 28, 1992

adequate if the income is equal to or greater than the income
necessary—

*(1) to make principal and interest payments on all debt
obligations of the borrower, in a timely manner;

"(2) to cover the necessary living expenses of the family
of the borrower; and

"(3) to pay all other obligations and expenses of the bor-
rower not financed through debt obligations referred to in para-
graph (1), including expenses of replacing capital items (deter-
mined after taking into account depreciation of the items),
"(c) CERTIFIED LENDERS PROGRAM.—

"(1) IN GENERAL.—The Secretary shall establish a program
under which the Secretary shall guarantee loans for any pur-
pose specified in subtitle B that are made by lending institu-
tions certified by the Secretary.

"(2) CERTIFICATION REQUIREMENTS.—The Secretary shall
certify a lending institution that meets such criteria as the
Secretary may prescribe in regulations, including the ability
of the institution to properly make, service, and liquidate the
loans of the institution.

"(3) CONDITION OF CERTIFICATION.-—As a condition of the
certification, the Secretary shall require the institution to
undertake to service the loans guaranteed by the Secretary
under this subsection, using standards that are not less strin-
gent than generally accepted banking standards concerning
loan servicing employed by prudent commercial or cooperative
lenders. The Secretary shall, at least annually, monitor the
performance of each certified lender to ensure that the condi-
tions of the certification are being met.

M(4) EFFECT OF CERTIFICATION.—Notwithstanding any other
provision of law:

"(A) The Secretary shall guarantee 80 percent of a
loan made under this subsection by a certified lending
institution as described in paragraph (1), subject to county
committee certification that the borrower of the loan meets
the eligibility requirements and such other criteria as may
be applicable to loans guaranteed by the Secretary under
other provisions of this title.

"(B) With respect to loans to be guaranteed by the
Secretary under this subsection, the Secretary shall permit
certified lending institutions to make appropriate certifi-
cations (as provided by regulations issued by the
Secretary^—

"(i) relating to issues such as creditworthiness,
repayment ability, adequacy of collateral, and feasibil-
ity of farm operation; and

"(ii) that the borrower is in compliance with all
requirements of law, including regulations issued by
the Secretary.

"(C) The Secretary shall approve or disapprove a
guarantee not later than 14 calendar days after the date
that the lending institution applied to the Secretary for
the guarantee. If the Secretary rejects the loan application
within the 14-day period, the Secretary shall state, in writ-
ing, all of the reasons the application was rejected.
a(5) RELATIONSHIP TO OTHER REQUIREMENTS.—Neither this
subsection nor subsection (d) shall affect the responsibility of