---
kind: "section"
citation: "7 C.F.R. § 3555.251"
title: "7"
number: "3555.251"
heading: "Servicing responsibility."
url: "https://uscodex.org/cfr/7/3555.251"
---

# §3555.251. Servicing responsibility.

- (a) **Servicing action.** Lenders must perform those servicing actions that a reasonable and prudent lender would perform in servicing its own portfolio of non-guaranteed loans.
- (b) **Third party servicer.** A lender may contract with a third party to service its loans, but the servicing lender of record remains responsible for the quality and completeness of the servicing.
- (c) **Transfer of servicing.** Rural Development may require a lender to transfer its loan servicing activities to an approved lender if Rural Development determines that the lender has failed to provide acceptable servicing.
- (d) **Non-compliance.** Lenders who fail to comply with Agency requirements or program guidelines may be subject to withdrawal of lender approval, denial and/or reduction in loss claims, withdrawal of the loan guarantee and/or indemnification in accordance with [§ 3555.108(d)](/cfr/7/3555.108.md?p=d).

## Notes

### Authority

Authority: 5 U.S.C. 301; 42 U.S.C. 1471 et seq.

### Source

Source: 78 FR 73941, December 9, 2013, unless otherwise noted.