reasonable assurance of repayment, and that 
adequate provision is made for servicing the 
loan on reasonable terms and protecting the fi-
nancial interest of the United States; 
‘‘(B) except to the extent that appropria-
tions of budget authority to cover their costs 
are made in advance, as required under section 
504 of the Federal Credit Reform Act of 1990; 
and 
‘‘(C) if— 
‘‘(i) the income from such loan is ex-
cluded from gross income for purposes of 
chapter 1 of the Internal Revenue Code of 
1986; or 
‘‘(ii) the guarantee provides signifi-
cant collateral or security, as determined 
by the Administrator, for other obligations 
the income from which is so excluded. 
‘‘(3) GUARANTEES.—A loan guarantee provided 
under this section shall be conclusive evidence that— 
‘‘(A) the guarantee has been properly ob-
tained; 
‘‘(B) the underlying loan qualified for such 
guarantee; and 
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‘‘(C) absent fraud or material misrepresen-
tation by the holder and the lender, the guar-
antee is presumed to be valid, legal, and en-
forceable. 
‘‘(g) PAYMENT OF LOSSES.— 
‘‘(1) IN GENERAL.—If, as a result of a default 
by a borrower under a loan guaranteed under this 
section, and after the holder of the loan has made 
collection efforts and instituted enforcement pro-
ceedings as the Administrator may require, the Ad-
ministrator determines that the holder of the loan 
has suffered a loss, the Administrator shall pay to 
such holder the percentage of such loss specified in 
the guarantee contract. Upon making any such pay-
ment, the Administrator shall be subrogated to all 
the rights of the recipient of the payment. The Ad-
ministrator shall be entitled to recover from the bor-
rower the amount of any payments made to the 
holder of the loan under this paragraph. 
‘‘(2) FORBEARANCE.—Nothing in this section 
may be construed to preclude any forbearance for 
the benefit of the borrower which may be agreed 
upon by the parties to the guaranteed loan and ap-
proved by the Administrator, if budget authority for 
any resulting subsidy costs (as defined in section 
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502(5) of the Federal Credit Reform Act of 1990) 
is available. 
‘‘(3) MANAGEMENT
OF
PROPERTY.—Notwith-
standing any other provision of law relating to the 
acquisition, handling, or disposal of property by the 
United States, the Administrator may complete, re-
condition, reconstruct, renovate, repair, maintain, 
operate, or sell any property acquired by the Admin-
istrator pursuant to this section. 
‘‘(h) SUNSET OF AUTHORITY.—The authority of the 
Administrator to make new loan guarantees under this 
section shall terminate after the end of the 5-year period 
beginning on the date of the enactment of this section.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall take effect on the date that is 180 
days after the date of the enactment of this Act. 
Æ 
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