§ 1715v. — Insurance of mortgages for housing for elderly persons.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 12USC1715v]
TITLE 12--BANKS AND BANKING
CHAPTER 13--NATIONAL HOUSING
SUBCHAPTER II--MORTGAGE INSURANCE
Sec. 1715v. Insurance of mortgages for housing for elderly
persons
(a) Purpose; definitions
The purpose of this section is to assist in relieving the shortage
of housing for elderly persons and to increase the supply of rental
housing for elderly persons.
For the purposes of this section--
(1) the term ``housing'' means eight or more new or
rehabilitated living units, not less than 50 per centum of which are
specially designed for the use and occupancy of elderly persons;
(2) the term ``elderly person'' means any person, married or
single, who is sixty-two years of age or over; and
(3) the terms ``mortgage'', ``mortgagee'', ``mortgagor'', and
``maturity date'' shall have the meanings respectively set forth in
section 1713 of this title.
(b) Authorization
The Secretary is authorized to insure any mortgage (including
advances on mortgages during construction) in accordance with the
provisions of this section upon such terms and conditions as he may
prescribe and to make commitments for insurance of such mortgages prior
to the date of their execution or disbursement thereon.
(c) Eligibility for insurance; maximum amount of mortgage; terms and
conditions
To be eligible for insurance under this section, a mortgage to
provide housing for elderly persons shall--
(1) Repealed. Pub. L. 93-383, title III, Sec. 304(f), Aug. 22,
1974, 88 Stat. 678.
(2)(A) 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), $35,978 per family unit
without a bedroom, $40,220 per family unit with one bedroom, $48,029
per family unit with two bedrooms, $57,798 per family unit with
three bedrooms, and $67,950 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 $40,876 per
family unit without a bedroom, $46,859 per family unit with one
bedroom, $56,979 per family unit with two bedrooms, $73,710 per
family unit with three bedrooms, and $80,913 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; (B) the
Secretary may, by regulation, increase any of the dollar limitations
in subparagraph (A) (as such limitations may have been adjusted in
accordance with section 1712a of this title) 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 \1\ of this title
(as such section existed immediately before November 30, 1983) is
involved; (C) the Secretary may, by regulation, increase any of the
dollar limitations in subparagraph (A) (as such limitations may have
been adjusted in accordance with section 1712a of this title) 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) \1\ 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;
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(3) if executed by a mortgagor which is a public instrumentality
or a private nonprofit corporation or association or other
acceptable private nonprofit organization regulated or supervised
under Federal or State laws or by political subdivisions of States,
or agencies thereof, or by the Secretary under a regulatory
agreement or otherwise, as to rents, charges, and methods of
operation, in such form and in such manner as, in the opinion of the
Secretary, will effectuate the purpose of this section, involve a
principal obligation not in excess 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
may include the land, the proposed physical improvements, utilities
within the boundaries of the land, architect's fees, taxes, interest
during construction, and other miscellaneous charges incident to
construction and approved by the Secretary): Provided, That in the
case of properties other than new construction, the principal
obligation shall not exceed the appraised value rather than the
Secretary's estimate of the replacement cost;
(4) if executed by a mortgagor which is approved by the
Secretary but is not a public instrumentality or a private nonprofit
organization, involve a principal obligation not in excess (in the
case of a property or project approved for mortgage insurance prior
to the beginning of construction) of 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 costs may include the land, the proposed physical
improvements, utilities within the boundaries of the land,
architect's fees, taxes, 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 principal obligation shall not exceed 90
per centum of the Secretary's estimate of the value of the property
or project: And provided further, That 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 operating, and for such purpose the Secretary may make
contracts with and acquire for not to exceed $100 such stock or
interest in any such mortgagor as the Secretary may deem necessary
to render effective such restrictions 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;
(5) provide for a complete amortization by periodic payments
(unless otherwise approved by the Secretary) within such terms as
the Secretary shall prescribe;
(6) bear interest at such rate as may be agreed upon by the
mortgagor and the mortgagee; and
(7) cover a property or project which is approved for mortgage
insurance prior to the beginning of construction or rehabilitation,
with 50 per centum or more of the units therein specially designed
for the use and occupancy of elderly persons in accordance with
standards established by the Secretary, and which may include such
commercial and special facilities as the Secretary deems adequate to
serve the occupants.
(d) Release of part of mortgaged property or project from lien;
preferences and priorities in rental of dwellings
The Secretary may consent to the release of a part or parts of the
mortgaged property or project from the lien of any mortgage insured
under this section upon such terms and conditions as he may prescribe,
and shall prescribe such procedures as in his judgment are necessary to
secure to elderly persons a preference or priority of opportunity to
rent the dwellings included in such property or project.
(e) Applicability of other laws
The provisions of subsections (d), (e), (g), (h), (i), (j), (k),
(l), and (n) of section 1713 of this title shall apply to mortgages
insured under this section and all references therein to section 1713 of
this title shall refer to this section.
(f) Handicapped family units and facilities; rental preference or
priority
Notwithstanding any of the provisions of this section, the housing
provided under this section may include family units which are specially
designed for the use and occupancy of any person or family qualifying as
a handicapped family as defined in section 1701q \2\ of this title, and
such special facilities as the Secretary deems adequate to serve
handicapped families (as so defined). The Secretary may also prescribe
procedures to secure to such families preference or priority of
opportunity to rent the living units specially designed for their use
and occupancy.
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\2\ See References in Text note below.
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(June 27, 1934, ch. 847, title II, Sec. 231, as added Pub. L. 86-372,
title II, Sec. 201(a), Sept. 23, 1959, 73 Stat. 665; amended Pub. L. 87-
70, title VI, Sec. 612(m), June 30, 1961, 75 Stat. 183; Pub. L. 88-560,
title I, Sec. 107(e), title II, Sec. 203(c), Sept. 2, 1964, 78 Stat.
776, 784; Pub. L. 89-117, title II, Sec. 207(e), title XI, Sec. 1108(l),
Aug. 10, 1965, 79 Stat. 467, 505; Pub. L. 90-19, Sec. 1(a)(3), (4), May
25, 1967, 81 Stat. 17; Pub. L. 90-301, Sec. 3(d), May 7, 1968, 82 Stat.
114; Pub. L. 91-152, title I, Sec. 113(g), Dec. 24, 1969, 83 Stat. 384;
Pub. L. 93-383, title III, Secs. 303(f), 304(f), Aug. 22, 1974, 88 Stat.
677, 678; Pub. L. 94-173, Sec. 3, Dec. 23, 1975, 89 Stat. 1027; Pub. L.
94-375, Sec. 8(a), (b)(6), Aug. 3, 1976, 90 Stat. 1071, 1072; Pub. L.
96-153, title III, Sec. 314, Dec. 21, 1979, 93 Stat. 1117; Pub. L. 96-
399, title III, Sec. 310(e), Oct. 8, 1980, 94 Stat. 1642; 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)(9), 446(e), Nov. 30, 1983, 97 Stat. 1209, 1228;
Pub. L. 100-242, title IV, Sec. 426(f), (h), Feb. 5, 1988, 101 Stat.
1916; Pub. L. 102-550, title V, Sec. 509(f), Oct. 28, 1992, 106 Stat.
3783; Pub. L. 107-73, title II, Sec. 213(f), Nov. 26, 2001, 115 Stat.
677; Pub. L. 107-326, Sec. 5(b)(6), Dec. 4, 2002, 116 Stat. 2795.)
References in Text
Section 1720 of this title, referred to in subsec. (c)(2)(B), 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. (c)(2)(C), 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.
The General Insurance Fund, referred to in subsec. (c)(4), was
established by section 1735c of this title.
Section 1701q of this title, referred to in subsec. (f), was amended
generally by Pub. L. 101-625, title VIII, Sec. 801(a), Nov. 28, 1990,
104 Stat. 4297, and, as so amended, no longer defines the term
``handicapped family''.
Amendments
2002--Subsec. (c)(2). Pub. L. 107-326 inserted ``(A)'' after ``(2)''
and substituted ``; (B) the Secretary may, by regulation, increase any
of the dollar limitations in subparagraph (A) (as such limitations may
have been adjusted in accordance with section 1712a of this title)'' for
``; and except that the Secretary may, by regulation, increase any of
the foregoing dollar amount limitations contained in this paragraph''
and ``; (C) the Secretary may, by regulation, increase any of the dollar
limitations in subparagraph (A) (as such limitations may have been
adjusted in accordance with section 1712a of this title)'' for ``:
Provided, That the Secretary may further increase the dollar amount
limitations which would otherwise apply for the purpose of this
section''.
2001--Subsec. (c)(2). Pub. L. 107-73 substituted ``$35,978'',
``$40,220'', ``$48,029'', ``$57,798'', and ``$67,950'' for ``$28,782'',
``$32,176'', ``$38,423'', ``$46,238'', and ``$54,360'', respectively,
and ``$40,876'', ``$46,859'', ``$56,979'', ``$73,710'', and ``$80,913''
for ``$32,701'', ``$37,487'', ``$45,583'', ``$58,968'', and ``$64,730'',
respectively.
1992--Subsec. (c)(2). Pub. L. 102-550 substituted ``$28,782'',
``$32,176'', ``$38,423'', ``$46,238'', and ``$54,360'' for ``$23,985'',
``$26,813'', ``$32,019'', ``$38,532'', and ``$45,300'', respectively,
and ``$32,701'', ``$37,487'', ``$45,583'', ``$58,968'', and ``$64,730''
for ``$27,251'', ``$31,239'', ``$37,986'', ``$49,140'', and ``$53,942'',
respectively.
1988--Subsec. (c)(2). Pub. L. 100-242 substituted ``$23,985'',
``$26,813'', ``$32,019'', ``$38,532'', and ``$45,300'' for ``$18,450'',
``$20,625'', ``$24,630'', ``$29,640'', and ``$34,846'', respectively,
and ``$27,251'', ``$31,239'', ``$37,986'', ``$49,140'', and ``$53,942''
for ``$20,962'', ``$24,030'', ``$29,220'', ``$37,800'', and ``$41,494'',
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. (c)(5). Pub. L. 98-181, Sec. 446(e), inserted
``(unless otherwise approved by the Secretary)'' after ``periodic
payments''.
Subsec. (c)(6). Pub. L. 98-181, Sec. 404(b)(9), substituted
provision that the interest rate be at such a rate as agreed upon by the
mortgagor and the mortgagee for provision that the interest rate,
exclusive of premium charges for insurance, 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.
1982--Subsec. (c)(2). 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. (c)(2). Pub. L. 97-35 inserted ``therein'' after
``installation'' and struck out ``therein'' after ``measure''.
1980--Subsec. (c)(2). Pub. L. 96-399 inserted proviso relating to
increase of dollar amount limitations due to installation of a solar
energy system.
1979--Subsec. (c)(2). Pub. L. 96-153 substituted ``75 per centum''
for ``50 per centum'' and inserted exception that the dollar amount
limitations may be exceeded by not be exceed 90 per centum where the
Secretary determines it to be necessary.
1976--Subsec. (c)(2). Pub. L. 94-375 substituted ``50 per centum in
any geographical area'' for ``75 per centum in any geographical area'',
``$18,450'' for ``$12,300'', ``$20,625'' for ``$17,188'', ``$24,630''
for ``$20,525'', ``$29,640'' for ``$24,700'', ``$34,846'' for
``$29,038'', ``$20,962'' for ``$13,975'', ``$24,030'' for ``$20,025'',
``$29,220'' for ``$24,350'', ``$37,800'' for ``$31,500'', and
``$41,494'' for ``$34,578''.
1975--Subsec. (c)(2). 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. (c)(1). Pub. L. 93-383, Sec. 304(f), struck out par.
(1) which set forth limits on principal obligations of mortgages.
Subsec. (c)(2). Pub. L. 93-383, Sec. 303(f), substituted ``$12,300''
for ``$8,800'', ``$13,975'' for ``$10,450'', ``$17,188'' for
``$12,375'', ``$20,025'' for ``$14,850'', ``$20,525'' for ``$14,850'',
``$24,350'' for ``$17,600'', ``$24,700'' for ``$18,700'', ``$29,038''
for ``$21,175'', ``$31,500'' for ``$22,000'', and ``$34,578'' for
``$25,025''.
1969--Subsec. (c)(2). Pub. L. 91-152 substituted ``$8,800'' for
``$8,000'', ``$10,450'' for ``$9,500'', ``$12,375'' for ``$11,250'',
``$14,850'' for ``$13,500'' wherever appearing, ``$17,600'' for
``$16,000'', ``$18,700'' for ``$17,000'', ``$21,175'' for ``$19,250'',
``$22,000'' for ``$20,000'', and ``$25,025'' for ``$22,750''.
1968--Subsec. (c)(6). Pub. L. 90-301 increased limitation on
interest rates from 5\1/2\ to 6 per centum per annum.
1967--Pub. L. 90-19, Sec. 1(a)(3), substituted ``Secretary'' for
``Commissioner'' wherever appearing in subsecs. (b), (c)(2) to (7), (d),
and (f).
Subsec. (c)(3), (4). Pub. L. 90-19, Sec. 1(a)(4), substituted
``Secretary's'' for ``Commissioner's''.
1965--Subsec. (c)(2). Pub. L. 89-117, Sec. 207(e), substituted
``$17,000 per family unit with three bedrooms, and $19,250 per family
unit with four or more bedrooms'' for ``and $17,000 per family unit with
three or more bedrooms'' and ``$20,000 per family unit with three
bedrooms, and $22,750 per family unit with four or more bedrooms'' for
``and $20,000 per family unit with three or more bedrooms''.
Subsec. (c)(4). Pub. L. 89-117, Sec. 1108(l)(1), substituted
``General Insurance Fund'' for ``section 207 Housing Insurance Fund''.
Subsec. (e). Pub. L. 89-117, Sec. 1108(l)(2), struck out references
to subsecs. (f), (m) and (p) of section 1713 of this title.
1964--Subsec. (c)(2). Pub. L. 88-560, Sec. 107(e), changed limits on
mortgages for property or project attributable to dwelling use from
``$2,250 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
``$8,000 per family unit without a bedroom, $11,250 per family unit with
one bedroom, $13,500 per family unit with two bedrooms, and $17,000 per
family unit with three or more bedrooms'', changed such mortgage limits
on project consisting of elevator-type structures from a sum ``of $2,250
per room to not to exceed $2,750 per room, and the dollar amount
limitation of $9,000 per family unit to not to exceed $9,400 per family
unit'' to dollar amount limitations ``per family unit to not to exceed
$9,500 per family unit without a bedroom, $13,500 per family unit with
one bedroom, $16,000 per family unit with two bedrooms, and $20,000 per
family unit with three or more bedrooms'', and substituted provisions
authorizing an increase ``by not to exceed 45 per centum'' of any of
such limits because of cost levels for former provision authorizing such
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). Pub. L. 88-560, Sec. 203(c), added subsec. (f).
1961--Subsec. (c)(2). Pub. L. 87-70 increased the maximum amount of
mortgages from not more than $9,000 per dwelling unit for such part of
such property or project as may be attributable to dwelling use to not
more than $2,250 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) for
such part of such property or project as may be attributable to dwelling
use (excluding exterior land improvements), and permitted an increase of
from $2,250 per room to not more than $2,750 per room to compensate for
the higher costs incident to the construction of elevator-type
structures.
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.
Repeals
The directory language of, but not the amendment made by, Pub. L.
90-301, Sec. 3(d), May 7, 1968, 82 Stat. 114, cited as a credit to this
section, was repealed by Pub. L. 98-181, title IV, Sec. 404(a), Nov. 30,
1983, 97 Stat. 1208.
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. (c)(5) 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 amendment to subsec. (c)(2) of this section
by section 107(e) of Pub. L. 88-560 or pre-amendment 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.
Section Referred to in Other Sections
This section is referred to in sections 1701s, 1712a, 1715c, 1715q,
1715r, 1717 of this title; title 42 sections 3013, 3535, 4822.
