Md. Code Regs. 05.13.04.19

Current through Register Vol. 51, No. 24, December 2, 2024

Section 05.13.04.19 - Claims for Charge Off

A. If the lender charges off all or part of an enrolled loan, the lender may file a claim with the Department. If the lender files a claim, it shall be filed contemporaneously with the charge off, and must be received by the Department within 30 days after the charge off.

B. The lender's claim may include, in addition to the amount of principal charged off plus accrued interest, 1/2 of the reasonable and documented out-of-pocket expenses incurred in pursuing collection efforts, including preservation of collateral. The amount of principal included in the claim may not exceed the amount of principal covered under the Program. The amount of accrued interest included in the claim may not exceed the amount of accrued interest attributable to the covered principal amount.

C. The lender shall determine when and how much to charge off on an enrolled loan in a manner consistent with the lender's normal method for making these determinations on similar loans that are not enrolled loans.

D. If the lender files two or more claims contemporaneously and there are insufficient funds in the reserve account at that time to cover the entire amount of the claims, the lender may designate the order of priority in which the Department shall pay the claims, except that a claim made with respect to an early loan always has priority of payment over all other claims that are not made with respect to an early loan or loans.

Md. Code Regs. 05.13.04.19