§ 1715k. — Rehabilitation and neighborhood conservation housing insurance.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 12USC1715k]
TITLE 12--BANKS AND BANKING
CHAPTER 13--NATIONAL HOUSING
SUBCHAPTER II--MORTGAGE INSURANCE
Sec. 1715k. Rehabilitation and neighborhood conservation housing
insurance
(a) Purpose of section
The purpose of this section is to aid in the elimination of slums
and blighted conditions and the prevention of the deterioration of
residential property by supplementing the insurance of mortgages under
sections 1709 and 1713 of this title with a system of loan and mortgage
insurance designed to assist the financing required for the
rehabilitation of existing dwelling accommodations and the construction
of new dwelling accommodations where such dwelling accommodations are
located in an area referred to in paragraph (1) of subsection (d) of
this section.
(b) Authorization
The Secretary is authorized, upon application by the mortgagee, to
insure, as hereinafter provided, any mortgage (including advances during
construction on mortgages covering property of the character described
in paragraph (3)(B) of subsection (d) of this section) which is eligible
for insurance as hereinafter provided, and, upon such terms and
conditions as he may prescribe, to make commitments for the insurance of
such mortgages prior to the date of their execution or disbursement
thereon.
(c) Definitions
As used in this section, the terms ``mortgage'', ``first mortgage'',
``mortgagee'', ``mortgagor'', ``maturity date'', and ``State'' shall
have the same meaning as in section 1707 of this title.
(d) Eligibility for insurance; conditions; limits
To be eligible for insurance under this section a mortgage shall
meet the following conditions:
(1) The mortgaged property shall--
(A) be located in (i) the area of a slum clearance and urban
redevelopment project covered by a Federal-aid contract executed
or a prior approval granted, pursuant to title I of the Housing
Act of 1949 [42 U.S.C. 1450 et seq.] before August 2, 1954, or
(ii) an urban renewal area (as defined in title I of the Housing
Act of 1949, as amended), or (iii) the area of an urban renewal
project assisted under section 111 of the Housing Act of 1949
[42 U.S.C. 1462], or (iv) an area in which a program of
concentrated code enforcement activities is being carried out
pursuant to section 117 of the Housing Act of 1949 [42 U.S.C.
1468], or (v) an area, designated by the Secretary, where
concentrated housing, physical development, and public service
activities are being or will be carried out in a coordinated
manner, pursuant to a locally developed strategy for
neighborhood improvement, conservation, or preservation:
Provided, That, in the case of an area within the purview of
clause (i) or (ii) of this subparagraph, a redevelopment plan or
an urban renewal plan (as defined in title I of the Housing Act
of 1949, as amended), as the case may be, has been approved for
such area by the governing body of the locality involved and by
the Secretary of Housing and Urban Development and the Secretary
has determined that such plan conforms to a general plan for the
locality as a whole and that there exist the necessary authority
and financial capacity to assure the completion of such
redevelopment or urban renewal plan: And provided further, That,
in the case of an area within the purview of clause (iii) of
this subparagraph, an urban renewal plan (as required for
projects assisted under such section 111 [42 U.S.C. 1462]) has
been approved for such area by such governing body and by the
Secretary, and the Secretary has determined that such plan
conforms to definite local objectives respecting appropriate
land uses, improved traffic, public transportation, public
utilities, recreational and community facilities, and other
public improvements, and that there exist the necessary
authority and financial capacity to assure the completion of
such urban renewal plan, and
(B) meet such standards and conditions as the Secretary
shall prescribe to establish the acceptability of such property
for mortgage insurance under this section.
(2) The mortgaged property shall be held by--
(A) a mortgagor approved by the Secretary, and the Secretary
may in his discretion require such mortgagor to be regulated or
restricted as to rents or sales, charges, capital structure,
rate of return and methods of operation, and for such purpose
the Secretary may make such contracts with and acquire for not
to exceed $100 stock or interest in any such mortgagor as the
Secretary may deem necessary to render effective such
restriction or regulations. Such stock or interest shall be paid
for out of the General Insurance Fund and shall be redeemed by
the mortgagor at par upon the termination of all obligations of
the Secretary under the insurance; or
(B) by Federal or State instrumentalities, municipal
corporate instrumentalities of one or more States, or limited
dividend or redevelopment or housing corporations or other legal
entities restricted by or under Federal or State laws or
regulations of State banking or insurance departments as to
rents, charges, capital structure, rate of return, or methods of
operation.
(3) The mortgage shall--
(A)(i) involve a principal obligation (including such
initial service charges, appraisal, inspection, and other fees
as the Secretary shall approve) in an amount not to exceed the
applicable maximum principal obligation which may be insured in
the area under section 1709(b) of this title; or in the case of
a dwelling designed principally for residential use for more
than four families (but not exceeding such additional number of
family units as the Secretary may prescribe) the applicable
maximum principal obligation secured by a four-family residence
which may be insured in the area under section 1709(b) of this
title plus not to exceed $9,165 for each additional family unit
in excess of four located on such property; and not to exceed an
amount equal to the sum of (1) 97 per centum (but, in any case
where the dwelling is not approved for mortgage insurance prior
to the beginning of construction, unless the construction of the
dwelling was completed more than one year prior to the
application for mortgage insurance, 90 per centum) of $25,000 of
the Secretary's estimate of replacement cost of the property, as
of the date the mortgage is accepted for insurance and (2) 95
per centum of such value in excess of $25,000: Provided, That in
the case of properties other than new construction, the
foregoing limitations upon the amount of the mortgage shall be
based upon the sum of the estimated cost of repair and
rehabilitation and the Secretary's estimate of the value of the
property before repair and rehabilitation rather than upon the
Secretary's estimate of the replacement cost: Provided further,
That if the mortgagor is a veteran and the mortgage to be
insured under this section covers property upon which there is
located a dwelling designed principally for a one-family
residence, the principal obligation may be in an amount equal to
the sum of (1) 100 per centum of $25,000 of the Secretary's
estimate of replacement cost of the property, as of the date the
mortgage is accepted for insurance and (2) 95 per centum of such
value in excess of $25,000. As used herein, the term ``veteran''
means any person who served on active duty in the Armed Forces
of the United States for a period of not less than ninety days
(or is certified by the Secretary of Defense as having performed
extrahazardous service), and who was discharged or released
therefrom under conditions other than dishonorable, except that
persons enlisting in the armed forces after September 7, 1980,
or entering active duty after October 16, 1981, shall have their
eligibility determined in accordance with section 5303A(d) of
title 38; and
(ii) in no case involving refinancing have a principal
obligation in an amount exceeding the sum of the estimated cost
of repair and rehabilitation and the amount (as determined by
the Secretary) required to refinance existing indebtedness
secured by the property or project, plus any existing
indebtedness incurred in connection with improving, repairing,
or rehabilitating the property; or
(B)(i) Repealed. Pub. L. 93-383, title III, Sec. 304(d),
Aug. 22, 1974, 88 Stat. 678.
(ii) not exceed 90 per centum of the amount which the
Secretary estimates will be the replacement cost of the property
or project when the proposed improvements are completed (the
replacement cost of the property or project may include the
land, the proposed physical improvements, utilities within the
boundaries of the property or project, architect's fees, taxes,
and interest during construction, and other miscellaneous
charges incident to construction and approved by the Secretary,
and shall include an allowance for builder's and sponsor's
profit and risk of 10 per centum of all of the foregoing items
except the land unless the Secretary, after certification that
such allowance is unreasonable, shall by regulation prescribe a
lesser percentage: Provided, That in the case of properties
other than new construction, the foregoing limitations upon the
amount of the mortgage shall be based upon the sum of the
estimated cost of repair and rehabilitation and the Secretary's
estimate of the value of the property before repair and
rehabilitation rather than upon the Secretary's estimate of the
replacement cost: Provided further, That the mortgage may
involve the financing of the purchase of property which has been
rehabilitated by a local public agency with Federal assistance
pursuant to section 110(c)(8) of the Housing Act of 1949 [42
U.S.C. 1460(c)(8)], and, in such case the foregoing limitations
upon the amount of the mortgage shall be based upon the
appraised value of the property as of the date the mortgage is
accepted for insurance;
(iii)(I) not exceed, for such part of the property or
project as may be attributable to dwelling use (excluding
exterior land improvements as defined by the Secretary), $38,025
per family unit without a bedroom, $42,120 per family unit with
one bedroom, $50,310 per family unit with two bedrooms, $62,010
per family unit with three bedrooms, and $70,200 per family unit
with four or more bedrooms; except that as to projects to
consist of elevator-type structures the Secretary, may in his
discretion, increase the dollar amount limitations per family
unit to not to exceed $43,875 per family unit without a bedroom,
$49,140 per family unit with one bedroom, $60,255 per family
unit with two bedrooms, $75,465 per family unit with three
bedrooms, and $85,328 per family unit with four or more
bedrooms, as the case may be, to compensate for the higher costs
incident to the construction of elevator-type structures of
sound standards of construction and design; and (II) with
respect to rehabilitation projects involving not more than five
family units, the Secretary may by regulation increase by 25 per
centum any of the dollar amount limitations in subparagraph
(B)(iii)(I) (as such limitations may have been adjusted in
accordance with section 1712a of this title) which are
applicable to units with two, three, or four or more bedrooms
with respect to dollar amount limitations applicable to
rehabilitation projects described in subclause (II), the
Secretary may, by regulation, increase the dollar amount
limitations contained in subparagraph (B)(iii)(I) (as such
limitations may have been adjusted in accordance with section
1712a of this title)) \1\ by not to exceed 110 percent in any
geographical area where the Secretary finds that cost levels so
require and by not to exceed 140 percent where the Secretary
determines it necessary on a project-by-project basis, but in no
case may any such increase exceed 90 percent where the Secretary
determines that a mortgage purchased or to be purchased by the
Government National Mortgage Association in implementing its
special assistance functions under section 1720 \2\ of this
title (as such section existed immediately before November 30,
1983) is involved; (III) That nothing contained in this \3\
subparagraph (B)(iii)(I) shall preclude the insurance of
mortgages covering existing multifamily dwellings to be
rehabilitated or reconstructed for the purposes set forth in
subsection (a) of this section; (IV) with respect to
rehabilitation projects involving not more than five family
units, the Secretary may further increase any of the dollar
limitations which would otherwise apply to such projects by not
to exceed 20 per centum if such increase is necessary to account
for the increased cost of the project due to the installation
therein of a solar energy system (as defined in subparagraph (3)
of the last paragraph of section 1703(a) of this title) or
residential energy conservation measures (as defined in section
8211(11)(A) through (G) and (I) of title 42) \2\ in cases where
the Secretary determines that such measures are in addition to
those required under the minimum property standards and will be
cost-effective over the life of the measure; and
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\1\ So in original.
\2\ See References in Text note below.
\3\ So in original. The word ``this'' probably should not appear.
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(iv) include such nondwelling facilities as the Secretary
deems desirable and consistent with the urban renewal plan or,
where appropriate, with the locally developed strategy for
neighborhood improvement, conservation or preservation:
Provided, That the project shall be predominantly residential
and any nondwelling facility included in the mortgage shall be
found by the Secretary to contribute to the economic feasibility
of the project, and the Secretary shall give due consideration
to the possible effect of the project on other business
enterprises in the community.
(4) The mortgage shall provide for complete amortization by
periodic payments within such terms as the Secretary may prescribe,
but as to mortgages coming within the provisions of paragraph (3)(A)
of this subsection not to exceed the maximum maturity prescribed by
the provisions of section 1709(b)(3) of this title. The mortgage
shall bear interest at such rate as may be agreed upon by the
mortgagor and the mortgagee and contain such terms and provisions
with respect to the application of the mortgagor's periodic payment
to amortization of the principal of the mortgage, insurance,
repairs, alterations, payment of taxes, default reserves,
delinquency charges, foreclosure proceedings, anticipation of
maturity, additional and secondary liens, and other matters as the
Secretary may in the Secretary's discretion prescribe.
(e) Release of mortgagor or part of property
The Secretary may at any time, under such terms and conditions as he
may prescribe, consent to the release of the mortgagor from his
liability under the mortgage or the credit instrument secured thereby,
or consent to the release of parts of the mortgaged property from the
lien of the mortgage.
(f) Entitlement of mortgagee to benefits; payment in cash or debentures;
acquisition of mortgages; applicability of other provisions
The mortgagee shall be entitled to receive the benefits of the
insurance as hereinafter provided--
(1) as to mortgages meeting the requirements of paragraph (3)(A)
of subsection (d) of this section as provided in section 1710(a) of
this title with respect to mortgages insured under section 1709 of
this title, and the provisions of subsections (b), (c), (d), (e),
(f), (g), (h),\2\ (j), and (k) \2\ of section 1710 of this title
shall be applicable to such mortgages insured under this section,
except that all references therein to the Mutual Mortgage Insurance
Fund or the Fund shall be construed to refer to the General
Insurance Fund and all references therein to section 1709 of this
title shall be construed to refer to this section;
(2) as to mortgages meeting the requirements of paragraph (3)(B)
of subsection (d) of this section, as provided in section 1713(g) of
this title with respect to mortgages insured under said section
1713, and the provisions of subsections (h), (i), (j), (k), and (l)
of section 1713 of this title shall be applicable to such mortgages
insured under this section, and all references therein to the
Housing Insurance Fund or the Housing Fund shall be construed to
refer to the General Insurance Fund; or
(3) as to mortgages meeting the requirements of this section
that are insured or initially endorsed for insurance on or after
June 30, 1961, notwithstanding the provisions of paragraphs (1) and
(2) of this subsection, the Secretary in his discretion, in
accordance with such regulations as he may prescribe, may make
payments pursuant to such paragraphs in cash or in debentures (as
provided in the mortgage insurance contract), or may acquire a
mortgage loan that is in default and the security therefor upon
payment to the mortgagee in cash or in debentures (as provided in
the mortgage insurance contract) of a total amount equal to the
unpaid principal balance of the loan plus any accrued interest and
any advances approved by the Secretary and made previously by the
mortgagee under the provisions of the mortgage. After the
acquisition of the mortgage by the Secretary the mortgagee shall
have no further rights, liabilities, or obligations with respect to
the loan or the security for the loan. The appropriate provisions of
sections 1710 and 1713 of this title relating to the rights,
liabilities, and obligations of a mortgagee shall apply with respect
to the Secretary when he has acquired an insured mortgage under this
paragraph, in accordance with and subject to regulations (modifying
such provisions to the extent necessary to render their application
for such purposes appropriate and effective) which shall be
prescribed by the Secretary, except that as applied to mortgages so
acquired (A) all references in section 1710 of this title to the
Mutual Mortgage Insurance Fund or the Fund shall be construed to
refer to the General Insurance Fund, and (B) all references in
section 1710 of this title to section 1709 of this title shall be
construed to refer to this section. If the insurance payment is made
in cash, there shall be added to such payment an amount equivalent
to the interest which the debentures would have earned, computed to
a date to be established pursuant to regulations issued by the
Secretary.
(g) Repealed. Pub. L. 89-117, title XI, Sec. 1108(h)(3), Aug. 10, 1965,
79 Stat. 505
(h) Home improvement loans; eligibility; conditions; refinancing;
premium charge; defaults; debentures; exception; limitation
(1) To assist further in the conservation, improvement, repair, and
rehabilitation of property located in the area of an urban renewal
project or in an area in which a program of concentrated code
enforcement activities is being carried out pursuant to section 117 of
the Housing Act of 1949 [42 U.S.C. 1468], as provided in paragraph (1)
of subsection (d) of this section, the Secretary is authorized upon such
terms and conditions as he may prescribe to make commitments to insure
and to insure home improvement loans (including advances during
construction or improvement) made by financial institutions on and after
June 30, 1961. As used in this subsection--
(A) the term ``home improvement loan'' means a loan, advance of
credit, or purchase of an obligation representing a loan or advance
of credit made--
(i) for the purpose of financing the improvement of an
existing structure (or in connection with an existing structure)
which was constructed not less than ten years prior to the
making of such loan, advance of credit, or purchase, and which
is used or will be used primarily for residential purposes:
Provided, That a home improvement loan shall include a loan,
advance, or purchase with respect to the improvement of a
structure which was constructed less than ten years prior to the
making of such loan, advance, or purchase if the proceeds are or
will be used primarily for major structural improvements, or to
correct defects which were not known at the time of the
completion of the structure or which were caused by fire, flood,
windstorm, or other casualty; or
(ii) for the purpose of enabling the borrower to pay that
part of the cost of the construction or installation of
sidewalks, curbs, gutters, street paving, street lights, sewers,
or other public improvements, adjacent to or in the vicinity of
property owned by him and used primarily for residential
purposes, which is assessed against him or for which he is
otherwise legally liable as the owner of such property;
(B) the term ``improvement'' means conservation, repair,
restoration, rehabilitation, conversion, alteration, enlargement, or
remodeling; and
(C) the term ``financial institution'' means a lender approved
by the Secretary as eligible for insurance under section 1703 of
this title or a mortgagee approved under section 1709(b)(1) of this
title.
(2) To be eligible for insurance under this subsection a home
improvement loan shall--
(i) not exceed the Secretary's estimate of the cost of
improvement, or $12,000 per family unit, whichever is the lesser,
and be limited as required by paragraph (11): Provided, That the
Secretary may, by regulation, increase such amount by not to exceed
45 per centum in any geographical area where he finds that cost
levels so require;
(ii) be limited to an amount which when added to any outstanding
indebtedness related to the property (as determined by the
Secretary) creates a total outstanding indebtedness which does not
exceed the limits provided in subsection (d)(3) of this section for
properties (of the same type) other than new construction;
(iii) bear interest at such rate as may be agreed upon by the
mortgagor and the mortgagee;
(iv) have a maturity satisfactory to the Secretary, but not to
exceed twenty years from the beginning of amortization of the loan;
(v) comply with such other terms, conditions, and restrictions
as the Secretary may prescribe; and
(vi) represent the obligation of a borrower who is the owner of
the property improved, or a lessee of the property under a lease for
not less than 99 years which is renewable or under a lease having an
expiration date in excess of 10 years later than the maturity date
of the loan.
(3) Any home improvement loan insured under this subsection may be
refinanced and extended in accordance with such terms and conditions as
the Secretary may prescribe, but in no event for an additional amount or
term in excess of the maximum provided for in this subsection.
(4) Repealed. Pub. L. 89-117, title XI, Sec. 1108(h)(3), Aug. 10,
1965, 79 Stat. 505.
(5) The Secretary is authorized to fix a premium charge for the
insurance of home improvement loans under this subsection but in the
case of any such loan such charge shall not be less than an amount
equivalent to one-half of 1 per centum per annum nor more than an amount
equivalent to 1 per centum per annum of the amount of the principal
obligation of the loan outstanding at any time, without taking into
account delinquent payments or prepayments. Such premium charges shall
be payable by the financial institution either in cash or in debentures
(at par plus accrued interest) issued by the Secretary as obligations of
the General Insurance Fund, in such manner as may be prescribed by the
Secretary, and the Secretary may require the payment of one or more such
premium charges at the time the loan is insured, at such discount rate
as he may prescribe not in excess of the interest rate specified in the
loan. If the Secretary finds upon presentation of a loan for insurance
and the tender of the initial premium charge or charges so required that
the loan complies with the provisions of this subsection, such loan may
be accepted for insurance by endorsement or otherwise as the Secretary
may prescribe. In the event the principal obligation of any loan
accepted for insurance under this subsection is paid in full prior to
the maturity date, the Secretary is authorized to refund to the
financial institution for the account of the borrower all, or such
portions as he shall determine to be equitable, of the current unearned
premium charges theretofore paid.
(6) In cases of defaults on loans insured under this subsection,
upon receiving notice of default, the Secretary, in accordance with such
regulations as he may prescribe, may acquire the loan and any security
therefor upon payment to the financial institution in cash or in
debentures (as provided in the loan insurance contract) of a total
amount equal to the unpaid principal balance of the loan, plus any
accrued interest, any advances approved by the Secretary made previously
by the financial institution under the provisions of the loan
instruments, and reimbursement for such collection costs, court costs,
and attorney fees as may be approved by the Secretary. If the insurance
payment is made in cash, there shall be added to such payment an amount
equivalent to the interest which the debentures would have earned,
computed to a date to be established pursuant to regulations issued by
the Secretary.
(7) Debentures issued under this subsection shall be executed in the
name of the General Insurance Fund as obligor, shall be negotiable, and,
if in book entry form, transferable, in the manner described by the
Secretary in regulations, and shall be dated as of the date the loan is
assigned to the Secretary and shall bear interest from that date. They
shall bear interest at a rate established by the Secretary pursuant to
section 1715o of this title, payable semiannually on the 1st day of
January and the 1st day of July of each year, and shall mature ten years
after their date of issuance. They shall be exempt from taxation as
provided in section 1713(i) of this title with respect to debentures
issued under that section. They shall be paid out of the General
Insurance Fund which shall be primarily liable therefor and they shall
be fully and unconditionally guaranteed as to principal and interest by
the United States, and, in the case of debentures issued in certificated
registered form, the guaranty shall be expressed on the face of the
debentures. In the event the General Insurance Fund fails to pay upon
demand, when due, the principal of or interest on any debentures so
guaranteed, the Secretary of the Treasury shall pay to the holders the
amount thereof which is authorized to be appropriated, out of any money
in the Treasury not otherwise appropriated, and thereupon, to the extent
of the amounts so paid, the Secretary of the Treasury shall succeed to
all the rights of the holders of such debentures. Debentures issued
under this subsection shall be in such form and amounts; shall be
subject to such terms and conditions; and shall include such provisions
for redemption, if any, as may be prescribed by the Secretary of Housing
and Urban Development, with the approval of the Secretary of the
Treasury; and may be in book entry or certificated registered form, or
such other form as the Secretary of Housing and Urban Development may
prescribe in regulations.
(8) The provisions of subsections (c), (d), and (h) of section 1703
of this title shall apply to home improvement loans insured under this
subsection, and for the purposes of this subsection references in
subsections (c), (d), and (h) of section 1703 of this title to ``this
section'' or ``this subchapter'' shall be construed to refer to this
subsection.
(9)(A) Notwithstanding any other provisions of this chapter, no home
improvement loan executed in connection with the improvement of a
structure for use as rental accommodations for five or more families
shall be insured under this subsection unless the borrower has agreed
(i) to certify, upon completion of the improvement and prior to final
endorsement of the loan, either that the actual cost of improvement
equaled or exceeded the proceeds of the home improvement loan, or the
amount by which the proceeds of the loan exceed the actual cost, as the
case may be, and (ii) to pay forthwith to the financial institution, for
application to the reduction of the principal of the loan, the amount,
if any, certified to be in excess of the actual cost of improvement.
Upon the Secretary's approval of the borrower's certification as
required under this paragraph, the certification shall be final and
incontestable, except for fraud or material misrepresentation on the
part of the borrower.
(B) As used in subparagraph (A), the term ``actual cost'' means the
cost to the borrower of the improvement, including the amounts paid for
labor, materials, construction contracts, off-site public utilities,
streets, organization and legal expenses, such allocations of general
overhead items as are acceptable to the Secretary, and other items of
expense approved by the Secretary, plus a reasonable allowance for
builder's profit if the borrower is also the builder, as defined by the
Secretary, and excluding the amount of any kickbacks, rebates, or trade
discounts received in connection with the improvement.
(10) Notwithstanding any other provision of this chapter, the
Secretary is authorized and empowered (i) to make expenditures and
advances out of funds made available by this chapter to preserve and
protect his interest in any security for, or the lien or priority of the
lien securing, any loan or other indebtedness owing to, insured by, or
acquired by the Secretary or by the United States under this subsection,
or section 1703 or 1709(k) of this title; and (ii) to bid for and to
purchase at any foreclosure or other sale or otherwise acquire property
pledged, mortgaged, conveyed, attached, or levied upon to secure the
payment of any loan or other indebtedness owing to or acquired by the
Secretary or by the United States under this subsection or section 1703
or 1709(k) of this title. The authority conferred by this paragraph may
be exercised as provided in the last sentence of section 1710(g) of this
title.
(11) Notwithstanding any other provision of this chapter, no home
improvement loan made in whole or in part for the purpose specified in
clause (A)(ii) of the second sentence of paragraph (1) shall be insured
under this subsection if such loan (or the portion thereof which is
attributable to such purpose), when added to the aggregate principal
balance of any outstanding loans insured under this subsection or
section 1709(k) of this title which were made to the same borrower for
the purpose so specified (or the portion of such aggregate balance which
is attributable to such purpose), would exceed $10,000 or such
additional amount as the Secretary has by regulation prescribed in any
geographical area where he finds cost levels so require pursuant to the
authority vested in him by the proviso in paragraph (2)(i) of this
subsection.
(June 27, 1934, ch. 847, title II, Sec. 220, as added Aug. 2, 1954, ch.
649, title I, Sec. 123, 68 Stat. 596; amended Aug. 11, 1955, ch. 783,
title I, Sec. 102(c), (g), 69 Stat. 635, 636; Aug. 7, 1956, ch. 1029,
title I, Sec. 107, title III, Sec. 307(b), 70 Stat. 1094, 1102; Pub. L.
85-10, Sec. 3, Mar. 27, 1957, 71 Stat. 8; Pub. L. 85-104, title I,
Secs. 102, 112, July 12, 1957, 71 Stat. 295, 297; Pub. L. 85-364,
Sec. 1(b), Apr. 1, 1958, 72 Stat. 73; Pub. L. 86-372, title I,
Secs. 109, 116(b), Sept. 23, 1959, 73 Stat. 657, 664; Pub. L. 87-70,
title I, Sec. 102(a), title VI, Secs. 609, 612(g), June 30, 1961, 75
Stat. 154, 179, 181; Pub. L. 88-560, title I, Secs. 105(c)(1), 107(c),
110-113, Sept. 2, 1964, 78 Stat. 772, 775, 777, 778; Pub. L. 89-117,
title II, Secs. 207(c), 209-211, title III, Sec. 311(c), (d), title XI,
Sec. 1108(h), Aug. 10, 1965, 79 Stat. 467, 469, 470, 478, 505; Pub. L.
89-754, title III, Secs. 305, 306, Nov. 3, 1966, 80 Stat. 1267; Pub. L.
90-19, Sec. 1(a)(3), (4), (g), May 25, 1967, 81 Stat. 17, 18; Pub. L.
90-448, title III, Sec. 311(a), title XVII, Sec. 1722(g), Aug. 1, 1968,
82 Stat. 510, 611; Pub. L. 91-152, title I, Secs. 102(b), 104, 113(d),
Dec. 24, 1969, 83 Stat. 380, 381, 384; Pub. L. 93-383, title III,
Secs. 302(b), 303(c), 304(d), 310(b), Aug. 22, 1974, 88 Stat. 676-678,
682; Pub. L. 94-173, Sec. 3, Dec. 23, 1975, 89 Stat. 1027; Pub. L. 94-
375, Sec. 8(a), (b)(3), Aug. 3, 1976, 90 Stat. 1071, 1072; Pub. L. 95-
24, title I, Sec. 105(b), Apr. 30, 1977, 91 Stat. 56; Pub. L. 95-128,
title III, Secs. 303(b), 304(b), Oct. 12, 1977, 91 Stat. 1132, 1133;
Pub. L. 96-153, title III, Secs. 312(b), 314, Dec. 21, 1979, 93 Stat.
1116, 1117; Pub. L. 96-399, title III, Secs. 310(c), 311, 333(b),
336(b), Oct. 8, 1980, 94 Stat. 1642, 1643, 1653, 1654; Pub. L. 97-35,
title III, Sec. 339B(a), Aug. 13, 1981, 95 Stat. 417; Pub. L. 97-377,
title I, Sec. 101(g), Dec. 21, 1982, 96 Stat. 1908; Pub. L. 98-181,
title IV, Secs. 404(b)(6), (7), 432(a), 446(c), Nov. 30, 1983, 97 Stat.
1209, 1220, 1228; Pub. L. 100-242, title IV, Secs. 405(2), 406(b)(9),
426(c), (h), Feb. 5, 1988, 101 Stat. 1899, 1901, 1916; Pub. L. 102-40,
title IV, Sec. 402(d)(2), May 7, 1991, 105 Stat. 239; Pub. L. 102-550,
title V, Secs. 509(c), 516(c), Oct. 28, 1992, 106 Stat. 3783, 3791; Pub.
L. 103-233, title III, Sec. 306, Apr. 11, 1994, 108 Stat. 373; Pub. L.
107-73, title II, Sec. 213(c), Nov. 26, 2001, 115 Stat. 676; Pub. L.
107-326, Sec. 5(b)(3), Dec. 4, 2002, 116 Stat. 2795.)
References in Text
The Housing Act of 1949, as amended, referred to in subsecs.
(d)(1)(A), (B)(ii), and (h)(1), is act July 15, 1949, ch. 338, 63 Stat.
413, as amended. Title I of the Housing Act of 1949, which was
classified generally to subchapter II (Sec. 1450 et seq.) of chapter 8A
of Title 42, The Public Health and Welfare, including sections 110, 111,
and 117 [42 U.S.C. 1460, 1462, 1468], was omitted from the Code pursuant
to section 5316 of Title 42 which terminated the authority to make loans
or grants under such title I after Jan. 1, 1975. For complete
classification of this Act to the Code, see Short Title note set out
under section 1441 of Title 42 and Tables.
Section 1720 of this title, referred to in subsec.
(d)(3)(B)(iii)(II), was repealed by Pub. L. 98-181, title IV,
Sec. 483(a), Nov. 30, 1983, 97 Stat. 1240.
Section 8211 of title 42, referred to in subsec. (d)(3)(B)(iii)(IV),
was omitted from the Code pursuant to section 8229 of Title 42, The
Public Health and Welfare, which terminated authority under that section
on June 30, 1989.
Subsection (h) of section 1710 of this title, referred to in subsec.
(f)(1), was redesignated subsec. (i) by Pub. L. 105-276, title VI,
Sec. 602(1), Oct. 21, 1998, 112 Stat. 2674.
Subsection (k) of section 1710 of this title, referred to in subsec.
(f)(1), was repealed by Pub. L. 105-276, title VI, Sec. 601(c), Oct. 21,
1998, 112 Stat. 2673.
Amendments
2002--Subsec. (d)(3)(B)(iii). Pub. L. 107-326 inserted subcl. (I)
designation after ``(iii)'' and substituted ``design; and (II)'' for
``design; and except that'', ``any of the dollar amount limitations in
subparagraph (B)(iii)(I) (as such limitations may have been adjusted in
accordance with section 1712a of this title)'' for ``any of the
foregoing dollar amount limitations contained in this clause'', ``with
respect to dollar amount limitations applicable to rehabilitation
projects described in subclause (II), the Secretary may, by regulation,
increase the dollar amount limitations contained in subparagraph
(B)(iii)(I) (as such limitations may have been adjusted in accordance
with section 1712a of this title)'' for ``: Provided, That the Secretary
may, by regulation, increase any of the foregoing dollar amount
limitations contained in this clause (as determined after the
application of the preceding proviso'', ``; (III)'' for ``: Provided
further,'', ``subparagraph (B)(iii)(I) shall preclude'' for
``subparagraph shall preclude'', and ``; (IV) with respect to
rehabilitation projects involving not more than five family units, the
Secretary may further increase any of the dollar limitations which would
otherwise apply to such projects'' for ``: And provided further, That
the Secretary may further increase any of the dollar amount limitations
which would otherwise apply for the purpose of this clause''.
2001--Subsec. (d)(3)(B)(iii). Pub. L. 107-73 substituted
``$38,025'', ``$42,120'', ``$50,310'', ``$62,010'', and ``$70,200'' for
``$30,420'', ``$33,696'', ``$40,248'', ``$49,608'', and ``$56,160'',
respectively, and ``$43,875'', ``$49,140'', ``$60,255'', ``$75,465'',
and ``$85,328'' for ``$35,100'', ``$39,312'', ``$48,204'', ``$60,372'',
and ``$68,262'', respectively.
1994--Subsec. (d)(3)(B)(iii). Pub. L. 103-233 substituted
``$56,160'' for ``$59,160''.
1992--Subsec. (d)(3)(B)(iii). Pub. L. 102-550, Sec. 509(c),
substituted ``$30,420'', ``$33,696'', ``$40,248'', ``$49,608'', and
``$59,160'' for ``$25,350'', ``$28,080'', ``$33,540'', ``$41,340'', and
``$46,800'', respectively, and ``$35,100'', ``$39,312'', ``$48,204'',
``$60,372'', and ``$68,262'' for ``$29,250'', ``$32,760'', ``$40,170'',
``$50,310'', and ``$56,885'', respectively.
Subsec. (h)(7). Pub. L. 102-550, Sec. 516(c), in first sentence,
substituted ``shall be negotiable, and, if in book entry form,
transferable, in the manner described by the Secretary in regulations''
for ``shall be signed by the Secretary, by either his written or
engraved signature, shall be negotiable'', in fourth sentence,
substituted ``and, in the case of debentures issued in certificated
registered form, the guaranty'' for ``and the guaranty'', inserted after
fifth sentence ``Debentures issued under this subsection shall be in
such form and amounts; shall be subject to such terms and conditions;
and shall include such provisions for redemption, if any, as may be
prescribed by the Secretary of Housing and Urban Development, with the
approval of the Secretary of the Treasury; and may be in book entry or
certificated registered form, or such other form as the Secretary of
Housing and Urban Development may prescribe in regulations.'' and struck
out at end ``Debentures issued under this subsection shall be in such
form and denominations in multiples of $50, shall be subject to such
terms and conditions, and shall include such provisions for redemption,
if any, as may be prescribed by the Secretary with the approval of the
Secretary of the Treasury, and they may be in coupon or registered form.
Any difference between the amount of the debentures to which the
financial institution is entitled, and the aggregate face value of the
debentures issued, not to exceed $50, shall be adjusted by the payment
of cash by the Secretary to the financial institution from the General
Insurance Fund.''
1991--Subsec. (d)(3)(A)(i). Pub. L. 102-40 substituted ``section
5303A(d) of title 38'' for ``section 3103A(d) of title 38''.
1988--Subsec. (d)(3)(A)(i). Pub. L. 100-242, Sec. 405(2), inserted
before semicolon at end ``, except that persons enlisting in the armed
forces after September 7, 1980, or entering active duty after October
16, 1981, shall have their eligibility determined in accordance with
section 3103A(d) of title 38''.
Subsec. (d)(3)(A)(ii) to (iv). Pub. L. 100-242, Sec. 406(b)(9),
redesignated former cl. (iv) as (ii) and struck out ``(except as
provided in cl. (iii))'', and struck out former cls. (ii) and (iii)
which read as follows:
``(ii) in a case where the mortgagor is not the occupant of the
property and intends to hold the property for rental purposes, have a
principal obligation in an amount not to exceed 93 per centum of the
amount computed under the provisions of clause (i);
``(iii) in a case where the mortgagor is not the occupant of the
property and intends to hold the property for the purpose of sale, have
a principal obligation in an amount not to exceed 85 per centum of the
amount computed under the provisions of clause (i), or in the
alternative, in an amount equal to the amount computed under the
provisions of clause (i) if the mortgagor and mortgagee assume
responsibility in a manner satisfactory to the Secretary for the
reduction of the mortgage by an amount not less than 15 per centum of
the outstanding principal amount thereof, or by such greater amount as
may be required to meet the limitations of clause (iv), in the event the
mortgaged property is not, prior to the due date of the eighteenth
amortization payment of the mortgage, sold to a purchaser acceptable to
the Secretary who is the occupant of the property and who assumes and
agrees to pay the mortgage indebtedness; and''.
Subsec. (d)(3)(B)(iii). Pub. L. 100-242, Sec. 426(c), (h),
substituted ``$25,350'', ``$28,080'', ``$33,540'', ``$41,340'', and
``$46,800'' for ``$19,500'', ``$21,600'', ``$25,800'', ``$31,800'', and
``$36,000'', respectively, and ``$29,250'', ``$32,760'', ``$40,170'',
``$50,310'', and ``$56,885'' for ``$22,500'', ``$25,200'', ``$30,900'',
``$38,700'', and ``$43,758'', respectively, and substituted ``not to
exceed 110 percent in any geographical area where the Secretary finds
that cost levels so require and by not to exceed 140 percent where the
Secretary determines it necessary on a project-by-project basis, but in
no case may any such increase exceed 90 percent where the Secretary
determines that a mortgage purchased or to be purchased by the
Government National Mortgage Association in implementing its special
assistance functions under section 1720 of this title (as such section
existed immediately before November 30, 1983) is involved'' for ``not to
exceed 75 per centum in any geographical area where he finds that cost
levels so require, except that, where the Secretary determines it
necessary on a project by project basis, the foregoing dollar amount
limitations contained in this paragraph may be exceeded by not to exceed
90 per centum (by not to exceed 140 per centum where the Secretary
determines that a mortgage other than one purchased or to be purchased
under section 1720 of this title by the Government National Mortgage
Association in implementing its special assistance functions is
involved) in such an area''.
1983--Subsec. (d)(3)(B)(ii). Pub. L. 98-181, Sec. 432(a), struck out
proviso that in no case involving refinancing would the mortgage exceed
the estimated cost of repair and rehabilitation and the amount, as
determined by the Secretary, required to refinance existing indebtedness
secured by the property or project.
Subsec. (d)(4). Pub. L. 98-181, Sec. 404(b)(6), substituted
provision that the interest rate be at such rate as agreed upon by the
mortgagor and mortgagee for provision that the interest rate, exclusive
of premium charges for insurance and service charges if any, not exceed
5 per centum per annum on the amount of the principal obligation
outstanding at any time, or not exceed such per centum per annum not in
excess of 6 per centum as the Secretary finds necessary to meet the
mortgage market.
Pub. L. 98-181, Sec. 446(c), inserted ``(unless otherwise approved
by the Secretary)'' after ``periodic payments''.
Subsec. (h)(2)(iii). Pub. L. 98-181, Sec. 404(b)(7), substituted
provision that the rate of interest be such rate as agreed upon by the
mortgagor and mortgagee for provision that the rate of interest not
exceed the rate prescribed by the Secretary, but not in excess of 6 per
centum per annum of the amount of the principal obligation outstanding
at any time, and such other charges as approved by the Secretary.
1982--Subsec. (d)(3)(B)(iii). Pub. L. 97-377 inserted ``(by not to
exceed 140 per centum where the Secretary determines that a mortgage
other than one purchased or to be purchased under section 1720 of this
title by the Government National Mortgage Association in implementing
its special assistance functions is involved)'' after ``90 per centum''.
1981--Subsec. (d)(3)(B)(iii). Pub. L. 97-35 inserted ``therein''
after ``installation'' and struck out ``therein'' after ``measure''.
1980--Subsec. (d)(1)(A)(v). Pub. L. 96-399, Sec. 311(a), added cl.
(v).
Subsec. (d)(3)(A)(i). Pub. L. 96-399, Sec. 336(b), substituted
provisions relating to the applicable maximum principal obligation which
may be insured in the area under section 1709(b) of this title, for
provisions setting forth dollar amounts of $67,500 for one-family
property, $76,000 for two-family, $92,000 for three-family, and $107,000
for four-family or more than four-family, and substituted ``$9,165'' for
``$8,250''.
Subsec. (d)(3)(B)(iii). Pub. L. 96-399, Sec. 310(c), inserted
proviso relating to increases in dollar amount limitations.
Subsec. (d)(3)(B)(iv). Pub. L. 96-399, Sec. 311(b), inserted
provisions relating to locally developed strategy for neighborhood
improvement, etc.
Subsec. (h)(2)(iv). Pub. L. 96-399, Sec. 333(b), struck out ``or
three-quarters of the remaining economic life of the structure,
whichever is the lesser'' after ``loan''.
1979--Subsec. (d)(3)(A)(i). Pub. L. 96-153, Sec. 312(b), substituted
``$67,500'' for ``$60,000'', ``$76,000'' for ``$65,000'' where it first
appeared, ``$92,000'' for ``$65,000'' where it appeared the second time,
``$107,000'' for ``$75,000'', and ``$8,250'' for ``$7,700''.
Subsec. (d)(3)(B)(iii). Pub. L. 96-153, Sec. 314, in first proviso
substituted ``75 per centum'' for ``50 per centum'' and inserted
exception that the dollar amount limitations may be exceeded not to
exceed 90 per centum where the Secretary determines it to be necessary.
1977--Subsec. (d)(1)(A)(ii). Pub. L. 95-24 struck out ``in a
community respecting which the Secretary of Housing and Urban
Development has made the determination provided for by section 101(c) of
the Housing Act of 1949, as amended after ``(as defined in title I of
the Housing Act of 1949, as amended)''.
Subsec. (d)(3)(A). Pub. L. 95-128 substituted ``$60,000'' for
``$45,000'', ``$65,000'' for ``$48,750'' and ``$75,000'' for ``$56,000''
wherever appearing in provisions preceding cl. (1); substituted in text
preceding first proviso ``and (2) 95 per centum of such value in excess
of $25,000'' for ``, (2) 90 per centum of such replacement cost in
excess of $25,000 but not in excess of $35,000, (3) 80 per centum of
such replacement cost in excess of $35,000'' and in second proviso ``and
(2) 95 per centum of such value in excess of $25,000'' for ``, (2) 90
per centum of such replacement cost in excess of $25,000 but not in
excess of $35,000, and (3) 85 per centum of such replacement cost in
excess of $35,000''.
1976--Subsec. (d)(3)(B)(iii). Pub. L. 94-375 substituted ``50 per
centum in any geographical area'' for ``75 per centum in any
geographical area'', ``$19,500'' for ``$13,000'', ``$21,600'' for
``$18,000'', ``$25,800'' for ``$21,500'', ``$31,800'' for ``$26,500'',
``$36,000'' for ``$30,000'', ``$22,500'' for ``$15,000'', ``$25,200''
for ``$21,000'', ``$30,900'' for ``$25,750'', ``$38,700'' for
``$32,250'', and ``$43,758'' for ``$36,465''.
1975--Subsec. (d)(3)(B)(iii). Pub. L. 94-173 raised from 45 per
centum to 75 per centum the amount by which any dollar limitation may,
by regulation, be increased.
1974--Subsec. (d)(3)(A)(i). Pub. L. 93-383, Sec. 302(b), substituted
``$45,000'' for ``$33,000'', ``$48,750'' for ``$35,750'', and
``$56,000'' for ``$41,250'' wherever appearing in provisions preceding
cl. (1).
Subsec. (d)(3)(A)(i)(1). Pub. L. 93-383, Sec. 310(b)(1), substituted
``$25,000'' for ``$15,000''.
Subsec. (d)(3)(A)(i)(2). Pub. L. 93-383, Sec. 310(b)(2), substituted
``$25,000'' for ``$15,000'' and ``$35,000'' for ``$25,000''.
Subsec. (d)(3)(A)(i)(3). Pub. L. 93-383, Sec. 310(b)(3), substituted
``$35,000'' for ``$25,000''.
Subsec. (d)(3)(B)(i). Pub. L. 93-383, Sec. 304(d), struck out cl.
(i) which set forth mortgage ceiling of $50,000,000.
Subsec. (d)(3)(B)(iii). Pub. L. 93-383, Sec. 303(c), substituted
``$13,000'' for ``$9,900'', ``$15,000'' for ``$11,550'', ``$18,000'' for
``$13,750'', ``$21,000'' for ``$16,500'', ``$21,500'' for ``$16,500'',
``$25,750'' for ``$19,800'', ``$26,500'' for ``$20,350'', ``$30,000''
for ``$23,100'', ``$32,250'' for ``$24,750'', and ``$36,465'' for
``$28,050''.
1969--Subsec. (d)(3)(A)(i). Pub. L. 91-152, Secs. 102(b), 113(d)(1),
substituted ``$7,700'' for ``$7,000'', ``$25,000'' for ``$20,000''
wherever appearing, ``$33,000'' for ``$30,000'', ``$35,750'' for
``$32,500'', and ``$41,250'' for ``$37,500'' wherever appearing.
Subsec. (d)(3)(B)(i). Pub. L. 91-152, Sec. 104, substituted
provisions that the mortgage not exceed $50,000,000 for provisions that
the mortgage not exceed $30,000,000, or, if executed by a mortgagor
within subsec. (d)(2)(B) of this section, not exceed $50,000,000.
Subsec. (d)(3)(B)(iii). Pub. L. 91-152, Sec. 113(d)(2), (3),
substituted ``$9,900'' for ``$9,000'', ``$11,550'' for ``$10,500'',
``$13,750'' for ``$12,500'', ``$16,500'' for ``$15,000'' wherever
appearing, ``$19,800'' for ``$18,000'', ``$20,350'' for ``$18,500'',
``$23,100'' for ``$21,000'', ``$24,750'' for ``$22,500'', and
``$28,050'' for ``$25,000''.
Subsec. (h)(2)(i). Pub. L. 91-152, Sec. 113(d)(4), substituted
``$12,000'' for ``$10,000''.
1968--Subsec. (d)(2)(B). Pub. L. 90-448, Sec. 1722(g), substituted
``corporations or other legal entities restricted by or under'' for
``corporations restricted by''.
Subsec. (d)(3)(B)(ii). Pub. L. 90-448, Sec. 311(a), inserted proviso
to permit the mortgage to involve the financing of the purchase of
property which has been rehabilitated by a local public agency with
Federal assistance pursuant to section 1460(c)(8) of Title 42.
1967--Pub. L. 90-19, Sec. 1(a)(3), substituted ``Secretary'' for
``Commissioner'' wherever appearing in subsecs. (b), (d)(1)(B),
(d)(2)(A), (d)(3)(A)(i), (iii), (iv), (d)(3) (B)(ii) to (iv), (d)(4),
(e), (f)(3), (h) (1), (h)(1)(C), (h)(2)(i) to (v), (h)(3), (5) to (7),
(h)(9)(B), and (h)(10), (11).
Pub. L. 90-19, Sec. 1(a)(4), substituted ``Secretary's'' for
``Commissioner's'' wherever appearing in subsecs. (d)(3)(A)(i)(B), (ii)
and (h)(2)(i), (9)(A).
Subsec. (d)(1)(A). Pub. L. 90-19, Sec. 1(g)(1)-(4), substituted
``Secretary of Housing and Urban Development'' and ``Secretary'' for
``Housing and Home Finance Administrator'' and ``Administrator''
wherever appearing, ``determination'' for ``certification to the
Commissioner'', and ``determined'' for ``certified to the Commissioner''
wherever appearing, respectively.
1966--Subsec. (d)(3)(A)(i). Pub. L. 89-754, Sec. 305, increased the
rate in cl. (3) from 75 to ``80 per centum of such replacement cost in
excess of $20,000'' and inserted proviso respecting mortgage limits of a
mortgagor who is a veteran and the mortgage to be insured covers
property upon which there is located a dwelling designed principally for
a one-family residence and definition of ``veteran''.
Subsec. (d)(3)(B)(iii). Pub. L. 89-754, Sec. 306, provided that with
respect to rehabilitation projects involving not more than five family
units, the Secretary may by regulation increase by 25 per centum any of
the dollar amount limitations contained in this clause which are
applicable to units with two, three, or four or more bedrooms, inserted
``as determined after the application of the preceding proviso'' before
``by not to exceed 45 per centum'', and substituted ``Provided further,
That nothing'' for ``Provided, That nothing''.
1965--Subsec. (d)(1)(A). Pub. L. 89-117, Sec. 311(c), inserted cl.
(iv).
Subsec. (d)(2). Pub. L. 89-117, Sec. 1108(h)(1), substituted ``the
General Insurance Fund'' for ``the section 220 Housing Insurance Fund''
wherever appearing.
Subsec. (d)(3)(A)(i). Pub. L. 89-117, Sec. 209(1), struck out a
second proviso which, in a case involving refinancing, prohibited the
mortgage to exceed the estimated cost of repair and rehabilitation and
the amount required to refinance existing indebtedness secured by the
property or project.
Subsec. (d)(3)(A)(ii). Pub. L. 89-117, Sec. 209(2), substituted
provisions prohibiting the mortgage, in a case where the mortgagor is
not the occupant of the property and intends to hold the property for
rental purposes, to have a principal obligation in an amount in excess
of 93 per centum of the amount computed under the provisions of cl. (i)
for provisions which prohibited the mortgage, in a case where a
mortgagor is not the occupant of the property, to have a principal
obligation in excess of an amount equal to 85 per centum of the amount
computed under cl. (i).
Subsec. (d)(3)(A)(iii), (iv). Pub. L. 89-117, Sec. 209(2), added
cls. (iii) and (iv).
Subsec. (d)(3)(B)(iii). Pub. L. 89-117, Sec. 207(c), substituted
``$18,500 per family unit with three bedrooms, and $21,000 per family
unit with four or more bedrooms'' for ``and $18,500 per family unit with
three or more bedrooms'' and ``$22,500 per family unit with three
bedrooms, and $25,500 per family unit with four or more bedrooms'' for
``and $22,500 per family unit with three or more bedrooms''.
Subsec. (d)(3)(B)(iv). Pub. L. 89-117, Sec. 210, substituted
``desirable and consistent with the urban renewal plan'' for ``adequate
to serve the needs of the occupants of the property and of other housing
in the neighborhood'', and inserted proviso.
Subsec. (f). Pub. L. 89-117, Sec. 1108(h)(1), (2), substituted ``the
General Insurance Fund'' for ``the section 220 Housing Insurance Fund''
wherever appearing and, in par. (3), struck out provision that, as to
mortgages acquired hereunder, all references in section 1713 of this
title to the Housing Insurance Fund, the Housing Fund, or the Fund shall
be construed to refer to the section 220 Housing Insurance Fund.
Subsec. (g). Pub. L. 89-117, Sec. 1108(h)(3), repealed subsec. (g)
which created the section 220 Housing Insurance Fund, provided for
transfer of funds thereto, and authorized purchase and cancellation of
debentures and the receipt and payment of charges and fees.
Subsec. (h)(1). Pub. L. 89-117, Sec. 311(d), inserted ``or in an
area in which a program of concentrated code enforcement activities is
being carried out pursuant to section 1468 of title 42''.
Subsec. (h)(2)(i). Pub. L. 89-117, Sec. 211(a), inserted proviso
permitting the Commissioner by regulation to increase the amount by not
to exceed 45 per centum in any geographical area where he finds that
cost levels so require.
Subsec. (h)(4). Pub. L. 89-117, Sec. 1108(h)(3), repealed par. which
created the Home Improvement Account and provided for the transfer of
funds thereto, credit and charges to such Account, and disposition of
surplus moneys.
Subsec. (h)(5), (7). Pub. L. 89-117, Sec. 1108(h)(4), substituted
``General Insurance Fund'' for ``section 220 Home Improvement Account''
wherever appearing.
Subsec. (h)(11). Pub. L. 89-117, Sec. 211(b), inserted ``or such
additional amount as the Commissioner has by regulation prescribed in
any geographical area where he finds cost levels so require pursuant to
the authority vested in him by proviso in paragraph (2)(i) of this
subsection''.
1964--Subsec. (d)(3)(A)(i). Pub. L. 88-560, Sec. 110, increased the
maximum amount of the principal obligation for one-family residences
from $25,000 to $30,000, for two-family residences from $27,500 to
$32,500, for three-family residences from $30,000 to $32,500, for four-
family residences from $35,000 to $37,500, and for more-than-four-family
residences from $35,000 to $37,500.
Subsec. (d)(3)(B)(i). Pub. L. 88-560, Sec. 111, substituted
``$30,000,000'' for ``$20,000,000''.
Subsec. (d)(3)(B)(iii). Pub. L. 88-560, Sec. 107(c), changed limits
on mortgages for property or project attributable to dwelling use from
``$2,500 per room (or $9,000 per family unit if the number of rooms in
such property or project is less than four per family unit)'' to
``$9,000 per family unit without a bedroom, $12,500 per family unit with
one bedroom, $15,000 per family unit with two bedrooms, and $18,500 per
family unit with three or more bedrooms'', changed such mortgage limits
on project consisting of elevator-type structures from a sum ``of $2,500
per room to not exceed $3,000 per room and the dollar amount limitation
of $9,000 per family unit to not exceed $9,400 per family unit'' to
dollar amount limitations ``per family unit to not to exceed $10,500 per
family unit without a bedroom, $15,000 per family unit with one bedroom,
$18,000 per family unit with two bedrooms, and $22,500 per family unit
with three or more bedrooms'', and substituted provision authorizing an
increase ``by not to exceed 45 per centum'' of any of such limits
because of cost levels for former provision authorizing such an increase
``by not to exceed $1,250 per room without regard to the number of rooms
being less than four, or four or more''.
Subsec. (f)(3). Pub. L. 88-560, Sec. 105(c)(1), inserted ``If the
insurance payment is made in cash, there shall be added to such payment
an amount equivalent to the interest which the debentures would have
earned, computed to a date to be established pursuant to regulations
issued by the Commissioner''.
Subsec. (h)(1). Pub. L. 88-560, Sec. 112(a), designated definitions
of ``home improvement loan'', ``improvement'', and ``financial
institution'' in second sentence as cls. (A)(i), (B), and (C),
respectively, and added cl. (A)(ii) to definition of ``home improvement
loan''.
Subsec. (h)(2)(i). Pub. L. 88-560, Sec. 112(b), inserted ``, and be
limited as required by paragraph (11) of this subsection''.
Subsec. (h)(2)(vi). Pub. L. 88-560, Sec. 113, substituted ``an
expiration date in excess of 10 years later than the maturity date of
the loan'' for ``a period of not less than 50 years to run from the date
of the loan''.
Subsec. (h)(6). Pub. L. 88-560, Sec. 105(c)(1), inserted ``If the
insurance payment is made in cash, there shall be added to such payment
an amount equivalent to the interest which the debentures would have
earned, computed to a date to be established pursuant to regulations
issued by the Commissioner''.
Subsec. (h)(11). Pub. L. 88-560, Sec. 112(c), added par. (11).
1961--Subsec. (a). Pub. L. 87-70, Sec. 102(a)(2), substituted ``loan
and mortgage insurance'' for ``mortgage insurance''.
Subsec. (d)(3)(A)(i). Pub. L. 87-70, Secs. 102(a)(1), 609, increased
the maximum amount of the principal obligation for one-family residences
from $22,500 to $25,000, and for two-family residences from $25,000 to
$27,500, substituted ``$15,000'' for ``$13,500'' in two places,
``$20,000'' for ``$18,000'' in two places, ``75 per centum'' for ``70
per centum'', and ``shall be based upon the sum of the estimated cost of
repair and rehabilitation and the Commissioner's estimate of the value
of the property before repair and rehabilitation rather than upon the
Commissioner's estimate of the replacement cost'' for ``shall be based
upon appraised value rather than upon the Commissioner's estimate of the
replacement cost'' in proviso relating to limitations upon the amount of
the mortgage in the case of properties other than new construction, and
inserted proviso which limits, in cases involving refinancing, the
amount of the mortgage to not more than the estimated cost of repair and
rehabilitation and the amount (as determined by the Commissioner)
required to refinance existing indebtedness secured by the property or
project.
Subsec. (d)(3)(B)(ii). Pub. L. 87-70, Sec. 102(a)(1), substituted
``shall be based upon the sum of the estimated cost of repair and
rehabilitation and the Commissioner's estimate of the value of the
property before repair and rehabilitation rather than upon the
Commissioner's estimate of the replacement cost'' for ``shall be based
upon appraised value rather than upon the Commissioner's estimate of the
replacement cost'' in proviso relating to limitations upon the amount of
the mortgage in the case of properties other than new construction, and
inserted the proviso which limits, in cases involving refinancing, the
amount of the mortgage to not more than the estimated cost of repair and
rehabilitation and the amount (as determined by the Commissioner)
required to refinance existing indebtedness secured by the property or
project.
Subsec. (f)(3). Pub. L. 87-70, Sec. 612(g), added par. (3).
Subsec. (h). Pub. L. 87-70, Sec. 102(a)(3), added subsec. (h).
1959--Subsec. (d)(3)(A)(i). Pub. L. 86-372, Sec. 109(a)(1), (2),
increased the maximum amount of the principal obligation for one-family
residences from $20,000 to $22,500, for two-family residences from
$20,000 to $25,000, and for three-family residences from $27,500 to
$30,000, and increased the maximum amount of loans over $13,500 from 85
percent of the value in excess of $13,500 but not in excess of $16,000
to 90 percent of the value in excess of $13,500 but not in excess of
$18,000.
Pub. L. 86-372, Sec. 109(a)(3), inserted proviso in subsec.
(d)(3)(A)(ii) making the 85 per centum limitation inapplicable if the
mortgagor and mortgagee assume responsibility for the reduction of the
mortgage by an amount not less than 15 per centum of the outstanding
principal amount thereof in the event the mortgaged property is not,
prior to the due date of the 18th amortization payment of the mortgage,
sold to a purchaser acceptable to the Commissioner who is the occupant
of the property and who assumes and agrees to pay the mortgage
indebtedness.
Subsec. (d)(3)(B)(i). Pub. L. 86-372, Sec. 109(b), substituted
``$20,000,000'' for ``$12,500,000''.
Subsec. (d)(3)(B)(iii). Pub. L. 86-372, Sec. 109(c)-(e), inserted
``(excluding exterior land improvements as defined by the
Commissioner)'' after ``dwelling use'', and substituted ``$2,500'' for
``$2,250'' in two places, ``$9,000'' for ``$8,100'' in two places,
``$3,000'' for ``$2,700'', ``$9,400'' for ``$8,400'', and ``$1,250'' for
``$1,000''.
Subsec. (d)(3)(B)(iv). Pub. L. 86-372, Sec. 109(e), added cl. (iv).
Subsec. (f)(1). Pub. L. 86-372, Sec. 116(b), inserted reference to
subsec. (k) of section 1710 of this title.
1958--Subsec. (d)(3)(A)(i). Pub. L. 85-364 substituted ``$13,500''
for ``$10,000'' in two places.
1957--Subsec. (d)(3). Pub. L. 85-104, Sec. 102, amended provisions
generally, and, among other changes, raised maximum mortgage obligation
from 95 to 97 percent, inserted ``unless the construction of the
dwelling was completed more than one year prior to the application for
mortgage insurance'', and as to estimated replacement cost, raised
figure from $9,000 to $10,000 and provided for 85 percent of such
replacement cost in excess of $10,000 and 70 percent in excess of
$16,000, in lieu of former provisions allowing 75 percent of such cost
in excess of $9,000 with Presidential authority to increase dollar
amounts to $10,000.
Subsec. (d)(3)(B)(iii). Pub. L. 85-10 substituted ``without regard
to the number of rooms being less than four, or four or more'' for ``or
per family unit, as the case may be'', in second proviso.
Subsec. (f)(1). Pub. L. 85-104, Sec. 112, substituted ``(h), and (j)
of section 1710 of this title'' for ``and (h) of section 1710 of this
title''.
1956--Subsec. (d)(1)(A). Act Aug. 7, 1956, Sec. 307(b), provided
mortgage insurance assistance for urban renewal areas under section 1462
of this title without requiring the programs required of areas in cl.
(i) or cl. (ii).
Subsec. (d)(3)(B)(ii). Act Aug. 7, 1956, Sec. 107(a), inserted ``,
and shall include an allowance for builder's and sponsor's profit and
risk of 10 per centum of all of the foregoing items except the land
unless the Commissioner, after certification that such allowance is
unreasonable, shall by regulation prescribe a lesser percentage'' after
``approved by the Secretary''.
Subsec. (d)(3)(B)(iii). Act Aug. 7, 1956, Sec. 107(b), substituted
``Provided further'' for ``except'', substituted ``any of the foregoing
dollar amount limitations'' for ``the foregoing limits'' and inserted
``or per family unit, as the case may be,'' after ``$1,000 per room''.
1955--Subsec. (d)(3)(A). Act Aug. 11, 1955, Sec. 102(g)(1), provided
that the maximum amount of a mortgage to be insured may be determined on
the bases of estimated replacement cost, and required determination upon
appraised value in case of properties other than new construction.
Subsec. (d)(3)(B). Act Aug. 11, 1955, Sec. 102(c), (g)(2), increased
from $5,000,000 to $12,500,000 the limitation on the maximum amount of a
mortgage, provided that the maximum amount of a mortgage to be insured
may be determined on the bases of estimated replacement cost, and
required determination upon appraised value in case of properties other
than new construction.
Effective Date of 1988 Amendment
Amendment by section 406(b)(9) of Pub. L. 100-242 applicable only
with respect to mortgages insured pursuant to conditional commitment
issued on or after Feb. 5, 1988, or in accordance with direct
endorsement program (24 CFR 200.163), if approved underwriter of
mortgagee signs appraisal report for property on or after Feb. 5, 1988,
see section 406(d) of Pub. L. 100-242, set out as a note under section
1709 of this title.
Effective Date of 1981 Amendment
Amendment by Pub. L. 97-35 effective Oct. 1, 1981, see section 371
of Pub. L. 97-35, set out as an Effective Date note under section 3701
of this title.
Limitation on Number of Dwelling Units With Mortgages Not Providing for
Complete Amortization
For limitation on the number of dwelling units with mortgages not
providing for complete amortization pursuant to authority granted by
amendment to subsec. (d)(4) by section 446 of Pub. L. 98-181, see
section 446(f) of Pub. L. 98-181, set out as a note under section 1713
of this title.
Amendments to Provisions for Family Unit Limits on Rental Housing;
Equitable Application of Such Amendments or Pre-Amendment Provisions to
Projects Submitted for Consideration Prior to September 2, 1964
Equitable application of amendments to subsec. (d)(3)(B)(iii) of
this section by section 107(c) of Pub. L. 88-560 or pre-amended
provisions to projects submitted for consideration prior to Sept. 2,
1964, see section 107(g) of Pub. L. 88-560, set out as a note under
section 1713 of this title.
Labor Standards
Application of section 1715c of this title, relating to labor
standards, to certain mortgage insurance under this section, see subsec.
(a) of section 1715c.
Section Referred to in Other Sections
This section is referred to in sections 1709, 1712a, 1713, 1715c,
1715l, 1715o, 1715q, 1715r, 1715w, 1715z-2, 1715z-5, 1717, 1731b of this
title.
