2 U.S.C. § 661a : US Code - Section 661A: Definitions

Search 2 U.S.C. § 661a : US Code - Section 661A: Definitions

For purposes of this subchapter - 
(1) The term "direct loan" means a disbursement of funds by the
Government to a non-Federal borrower under a contract that
requires the repayment of such funds with or without interest.
The term includes the purchase of, or participation in, a loan
made by another lender and financing arrangements that defer
payment for more than 90 days, including the sale of a government
(!1) asset on credit terms. The term does not include the
acquisition of a federally guaranteed loan in satisfaction of
default claims or the price support loans of the Commodity Credit
Corporation.
(2) The term "direct loan obligation" means a binding agreement
by a Federal agency to make a direct loan when specified
conditions are fulfilled by the borrower.
(3) The term "loan guarantee" means any guarantee, insurance,
or other pledge with respect to the payment of all or a part of
the principal or interest on any debt obligation of a non-Federal
borrower to a non-Federal lender, but does not include the
insurance of deposits, shares, or other withdrawable accounts in
financial institutions.
(4) The term "loan guarantee commitment" means a binding
agreement by a Federal agency to make a loan guarantee when
specified conditions are fulfilled by the borrower, the lender,
or any other party to the guarantee agreement.
(5)(A) The term "cost" means the estimated long-term cost to
the Government of a direct loan or loan guarantee or modification
thereof, calculated on a net present value basis, excluding
administrative costs and any incidental effects on governmental
receipts or outlays.
(B) The cost of a direct loan shall be the net present value,
at the time when the direct loan is disbursed, of the following
estimated cash flows:
(i) loan disbursements;
(ii) repayments of principal; and
(iii) payments of interest and other payments by or to the
Government over the life of the loan after adjusting for
estimated defaults, prepayments, fees, penalties, and other
recoveries;
including the effects of changes in loan terms resulting from the
exercise by the borrower of an option included in the loan
contract.
(C) The cost of a loan guarantee shall be the net present
value, at the time when the guaranteed loan is disbursed, of the
following estimated cash flows:
(i) payments by the Government to cover defaults and
delinquencies, interest subsidies, or other payments; and
(ii) payments to the Government including origination and
other fees, penalties and recoveries;
including the effects of changes in loan terms resulting from the
exercise by the guaranteed lender of an option included in the
loan guarantee contract, or by the borrower of an option included
in the guaranteed loan contract.
(D) The cost of a modification is the difference between the
current estimate of the net present value of the remaining cash
flows under the terms of a direct loan or loan guarantee
contract, and the current estimate of the net present value of
the remaining cash flows under the terms of the contract, as
modified.
(E) In estimating net present values, the discount rate shall
be the average interest rate on marketable Treasury securities of
similar maturity to the cash flows of the direct loan or loan
guarantee for which the estimate is being made.
(F) When funds are obligated for a direct loan or loan
guarantee, the estimated cost shall be based on the current
assumptions, adjusted to incorporate the terms of the loan
contract, for the fiscal year in which the funds are obligated.
(6) The term "credit program account" means the budget account
into which an appropriation to cover the cost of a direct loan or
loan guarantee program is made and from which such cost is
disbursed to the financing account.
(7) The term "financing account" means the non-budget account
or accounts associated with each credit program account which
holds balances, receives the cost payment from the credit program
account, and also includes all other cash flows to and from the
Government resulting from direct loan obligations or loan
guarantee commitments made on or after October 1, 1991.
(8) The term "liquidating account" means the budget account
that includes all cash flows to and from the Government resulting
from direct loan obligations or loan guarantee commitments made
prior to October 1, 1991.
These accounts shall be shown in the budget on a cash basis.
(9) The term "modification" means any Government action that
alters the estimated cost of an outstanding direct loan (or
direct loan obligation) or an outstanding loan guarantee (or loan
guarantee commitment) from the current estimate of cash flows.
This includes the sale of loan assets, with or without recourse,
and the purchase of guaranteed loans. This also includes any
action resulting from new legislation, or from the exercise of
administrative discretion under existing law, that directly or
indirectly alters the estimated cost of outstanding direct loans
(or direct loan obligations) or loan guarantees (or loan
guarantee commitments) such as a change in collection procedures.
(10) The term "current" has the same meaning as in section
900(c)(9) of this title.
(11) The term "Director" means the Director of the Office of
Management and Budget.