Section 001-31-I - Loan Covenants The covenants and requirements of the loan shall be established by the Commissioner in accordance with prudent lending practices. At minimum, the documents should ordinarily require the borrower to:
1. Make periodic payments of principal and interest;2. Make any lease payments;3. Maintain adequate insurance on collateral, and maintain books and records on the business;4. Maintain and repair the collateral;5. Pay any taxes or governmental charges assessed against the collateral and comply with all applicable governmental laws and regulations;6. Keep the collateral free of liens and encumbrances except as may be expressly accepted by the Commissioner;7. Provide periodic financial reports;8. Repay advances necessary to protect the collateral and all expenses of protecting or enforcing the rights of the Department. The Commissioner may require such additional covenants and requirements as may be necessary, prudent or desirable, including, but not limited to, crop insurance.
The borrower will be required to sign a loan agreement containing such covenants and adhere to the terms thereof.
01-001 C.M.R. ch. 31, § I