CFR > Title 12 - Banks and Banking > CHAPTER VI—FARM CREDIT ADMINISTRATION > SUBCHAPTER B—FARM CREDIT SYSTEM (parts 609 to 655) > PART 621—ACCOUNTING AND REPORTING REQUIREMENTS > SUBPART C—Loan Performance and Valuation Assessment (§621.6 to §621.10) > 621.9—Reinstatement to accrual status.

621.9—Reinstatement to accrual status.

A loan may be reinstated to accrual status, when each of the following criteria are met:
(a) All contractual principal and interest due on the loan is paid and the loan is current;
(b) Prior chargeoffs are recovered, except for troubled debt restructures;
(c) No reasonable doubt remains regarding the willingness and ability of the borrower to perform in accordance with the contractual terms of the loan agreement; and
(d) Reinstatement is supported by a period of sustained performance in accordance with the contractual terms of the note and/or loan agreement. Sustained performance will generally be demonstrated by 6 consecutive monthly payments, 4 consecutive quarterly payments, 3 consecutive semi-annual payments, or 2 consecutive annual payments.