Debt Forgiveness Law and Legal Definition

(A) In general, the term "debt forgiveness" is defined as “reducing or terminating a farmer program loan made or guaranteed under this title, in a manner that results in a loss to the Secretary, through--

(i) writing down or writing off a loan under section 353 [7 USCS § 2001];

(ii) compromising, adjusting, reducing, or charging-off a debt or claim under section 331 [7 USCS § 1981];

(iii) paying a loss on a guaranteed loan under section 357 [7 USCS § 2005]; or

(iv) discharging a debt as a result of bankruptcy.

(B) Exceptions - The term "debt forgiveness" does not include--

(i) consolidation, rescheduling, reamortization, or deferral of a loan; or

(ii) any write-down provided as part of a resolution of a discrimination complaint against the Secretary.” (7 USCS § 1991)