46 U.S.C. § 31322: Preferred mortgages

includes the whole of the vessel; is filed in substantial compliance with section 31321 of this title ; covers a documented vessel; or covers a vessel for which an application for documentation is filed that is in substantial compliance with the requirements of chapter 121 of this title and the regulations prescribed under that chapter; and a person eligible to own a vessel with a fishery endorsement under section 12113(c) of this title ; a State or federally chartered financial institution that is insured by the Federal Deposit Insurance Corporation; a farm credit lender established under title 12, chapter 23 of the United States Code; a commercial fishing and agriculture bank established pursuant to State law; a commercial lender organized under the laws of the United States or of a State and eligible to own a vessel for purposes of documentation under section 12103 of this title ; or a mortgage trustee under subsection (f) of this section. Any indebtedness secured by a preferred mortgage that is filed or recorded under this chapter, or that is subject to a mortgage, security agreement, or instruments granting a security interest that is deemed to be a preferred mortgage under subsection (d) of this section, may have any rate of interest to which the parties agree. If a preferred mortgage includes more than one vessel or property that is not a vessel, the mortgage may provide for the separate discharge of each vessel and all property not a vessel by the payment of a part of the mortgage indebtedness. the mortgage constitutes a lien on that vessel in the full amount of the outstanding mortgage indebtedness; and an allocation of mortgage indebtedness for purposes of separate discharge may not be made among the vessel and other property covered by the mortgage. the Secretary certifies that the State titling system complies with the Secretary’s guidelines for a titling system under section 13107(b)(8) of this title ; and information on the vessel covered by the mortgage, security agreement, or instrument is made available to the Secretary under chapter 125 of this title. the Secretary’s certification under paragraph (1)(A) of this subsection; and the State begins making information available to the Secretary under chapter 125 of this title. A preferred mortgage under this subsection continues to be a preferred mortgage even if the vessel is no longer titled in the State where the mortgage, security agreement, or instrument granting a security interest became a preferred mortgage under this subsection. the status of the preferred mortgage covering the vessel to be titled in the State is determined by the law of the jurisdiction where the vessel is currently titled or documented; and the status of the preferred mortgage covering the vessel to be documented under chapter 121 is determined by subsection (a) of this section. is eligible to be a preferred mortgagee under subsection (a)(4), subparagraphs (A)–(E) of this section; is organized as a corporation, and is doing business, under the laws of the United States or of a State; is authorized under those laws to exercise corporate trust powers; is subject to supervision or examination by an official of the United States Government or a State; has a combined capital and surplus (as stated in its most recent published report of condition) of at least $3,000,000; and meets any other requirements prescribed by the Secretary. If the beneficiary under the trust arrangement is not a commercial lender, a lender syndicate or eligible to be a preferred mortgagee under subsection (a)(4), subparagraphs (A)–(E) of this section, the Secretary must determine that the issuance, assignment, transfer, or trust arrangement does not result in an impermissible transfer of control of the vessel to a person not eligible to own a vessel with a fishery endorsement under section 12113(c) of this title . A vessel with a fishery endorsement may be operated by a mortgage trustee only with the approval of the Secretary. A right under a mortgage of a vessel with a fishery endorsement may be issued, assigned, or transferred to a person not eligible to be a mortgagee of that vessel under this section only with the approval of the Secretary. The issuance, assignment, or transfer of an instrument or evidence of indebtedness contrary to this subsection is voidable by the Secretary. For purposes of this section a “commercial lender” means an entity primarily engaged in the business of lending and other financing transactions with a loan portfolio in excess of $100,000,000, of which not more than 50 per centum in dollar amount consists of loans to borrowers in the commercial fishing industry, as certified to the Secretary by such lender. For purposes of this section a “lender syndicate” means an arrangement established for the combined extension of credit of not less than $20,000,000 made up of four or more entities that each have a beneficial interest, held through an agent, under a trust arrangement established pursuant to subsection (f), no one of which may exercise powers thereunder without the concurrence of at least one other unaffiliated beneficiary.