§ 570a-2

570A.2 Financial institution memorandum to agricultural supply dealers. 1. Upon the receipt of a certified request of an agricultural supply dealer, prior to or upon a sale on a credit basis of an agricultural supply to a farmer, a financial institution whichhas either a security interest in collateral owned by the farmer or an outstanding loan tothe farmer for an agricultural purpose shall issue within four business days a memorandumwhich states whether or not the farmer has a sufficient net worth or line of credit to assurepayment of the purchase price on the terms of the sale. The certified request submitted bythe agricultural supply dealer shall state the amount of the purchase and the terms of saleand shall be accompanied by a waiver of confidentiality signed by the farmer, and a fifteendollar fee. The waiver of confidentiality and the certified request may be combined andsubmitted as one document. If the financial institution states in its memorandum that thefarmer has a sufficient net worth or line of credit to assure payment of the purchase price,the memorandum is an irrevocable and unconditional letter of credit to the benefit of theagricultural supply dealer for a period

nt net worth or line of credit to assure payment of the purchase price,the memorandum is an irrevocable and unconditional letter of credit to the benefit of theagricultural supply dealer for a period of thirty days following the date on which the finalpayment is due for the amount of the purchase price which remains unpaid. If the financialinstitution does not state in its memorandum that the farmer has a sufficient net worth or lineof credit to assure payment of the purchase price, the financial institution shall transmit therelevant financial history which it holds on the person. This financial history shall remainconfidential between the financial institution, the agricultural supply dealer, and the farmer. 2. If within four business days of receipt of a certified request a financial institution fails to issue a memorandum upon the request of an agricultural supply dealer and the request fromthe agricultural supply dealer was proper under subsection 1, or if the memorandum fromthe financial institution is incomplete, or if the memorandum from the financial institutionstates that the farmer does not have a sufficient net worth or line of credit to assure paymentof the purchase

financial institution is incomplete, or if the memorandum from the financial institutionstates that the farmer does not have a sufficient net worth or line of credit to assure paymentof the purchase price, the agricultural supply dealer may decide to make the sale and securethe lien provided in section 570A.3. 3. Upon an action to enforce a lien secured under section 570A.3 against the interest of a financial institution secured to the same collateral as that of the lien, it shall be an affirmativedefense to a financial institution and complete proof of the superior priority of the financialinstitution’s lien that the financial institution either did not receive a certified request and awaiver signed by the farmer, or received the request and a waiver signed by the farmer andprovided the full and complete relevant financial history which it held on the farmer makingthe purchase from the agricultural supply dealer on which the lien is based and that financialhistory reasonably indicated that the farmer did not have a sufficient net worth or line ofcredit to assure payment of the purchase price.

l supply dealer on which the lien is based and that financialhistory reasonably indicated that the farmer did not have a sufficient net worth or line ofcredit to assure payment of the purchase price. 84 Acts, ch 1072, §2; 85 Acts, ch 204, §2; 90 Acts, ch 1168, §58; 2003 Acts, ch 82, §3Referred to in §570A.5 Sat Dec 23 11:07:35 2023 Iowa Code 2024, Section 570A.2 (15, 0)