12480. A mortgage insurer shall not make or purchase any
investments or loans except as authorized by this chapter unless:
(a) The loan or investment was legally made or purchased by the
insurer before August 21, 1933.
(b) The loan is a renewal or extension of any loan legally made
before August 21, 1933.
12481. A mortgage insurer shall not, directly or indirectly, make
any loan to any of its officers, directors or other employees.
12482. A mortgage insurer shall invest in, hold or own any of the
capital stock of any other corporation or make any loan, in whole or
in part, on security of such stock only as expressly permitted by
this article.
12483. In connection with its investment in an authorized real
estate security, a mortgage insurer may, in its own name as pledgee,
take stock, in a water or power corporation, where such stock
represents the right to receive or obtain water or power for
beneficial use on the real estate securing its investment, whether or
not such right is appurtenant to the investment. The insurer may
hold, use, or dispose of any such stock for the benefit and
protection of such investment.
12484. A mortgage insurer may invest in, hold, buy and sell, and
may make collateral loans secured by:
(a) The securities specified in sections 1170 to 1175, inclusive.
(b) Authorized real estate securities, but not in excess of
fifteen per cent of the insurer's paid-in capital in any one
security.
(c) Securities, the payment of which is insured by itself or
another domestic admitted mortgage insurer, and mortgage
participation certificates issued by itself or another insurer
pursuant to this chapter.
(d) Collateral trust bonds or notes secured by deposit with a
trustee of securities authorized for investment by this article if
such securities have a market value at least equal to one hundred
fifteen per cent of the par value of the collateral trust bonds or
notes then outstanding.
(e) The stock issued by any Federal Home Loan Bank or other
similar Federal agency of which such mortgage insurer is eligible to
become a member, and the bonds, debentures and notes issued by any
Federal Home Loan Bank or other similar Federal agency.
(f) Bonds of a metropolitan water district.
(g) Stock of any corporation organized under the laws of
California to transact the business of insurance agent or insurance
broker; but a mortgage insurer shall not invest in the stock of such
corporation unless it acquires at least fifty-one per cent of the
voting stock thereof; provided, further, no insurer shall acquire, or
purchase any stock pursuant to the provisions of this paragraph
without having first obtained the approval in writing of the
commissioner.
(h) Stocks, bonds, debentures, or other securities of any
corporation where the same or any thereof are acquired by a mortgage
insurer in full or partial satisfaction of a debt previously
contracted or an obligation previously acquired in good faith and
owned or insured by such insurer, or in exchange for any such debt or
obligation; also stocks, bonds, debentures, or other securities of
any corporation where the same or any thereof are acquired in
connection with the sale or liquidation of any real estate owned by
such insurer or held in any mortgage participation trust of such
insurer, also stocks, bonds, debentures, or other securities of any
corporation where the same or any thereof are acquired in connection
with or as a part of any plan or agreement of reorganization,
readjustment or rehabilitation of such insurer, which plan or
agreement has been approved in the manner required by any present or
future law or in connection with the amendment, modification or
termination in a manner provided by any present or future law of any
or all mortgage participation certificates issued by such insurer or
of all or any part of the mortgage participation trusts created by
such insurer; also stocks, bonds, debentures, or other securities of
any corporation organized to take over and acquire all or any part of
the assets of such mortgage insurer and all or any part of the
assets of any existing mortgage participation trust or trusts created
by such insurer; provided, however, no mortgage insurer shall
acquire or invest in stocks, bonds, debentures, or other securities
of any corporation in an amount greater than ten per cent of the then
authorized, issued and outstanding capital stock of such mortgage
insurer or in an amount greater than $25,000, without having first
obtained the written consent of the commissioner.
(i) Any note or notes secured by a second mortgage or second deed
of trust where such note is acquired in full or partial satisfaction
of a debt, or in the sale or liquidation of any asset acquired in
connection with the full or partial satisfaction of any debt.
A mortgage insurer may renew or extend any loan heretofore legally
made or purchased or accept and hold any purchase money mortgage or
deed of trust in connection with the liquidation of any real estate.
12485. Mortgage insurers may make deposits with any bank or savings
and loan associations the accounts of which are insured by an agency
or instrumentality of the federal government. The making and
maintenance of such deposits and investments is not subject to
restrictions relating to investments.
12486. Any mortgage insurer may purchase and hold or convey real
estate of the following character only:
(a) Subject to the limit on aggregate cost contained in
subdivision (b), the land, with improvements thereon, on which its
office is located, if the cost of the land together with improvements
does not exceed twenty-five per cent of its paid-in capital.
(b) Such as is requisite for its accommodation in the convenient
transaction of its business. The aggregate cost of real estate with
improvements acquired under the authority granted in subdivisions (a)
and (b) shall not exceed twenty-five per cent of its paid-in
capital.
(c) Such as is conveyed to it or to any person for it to secure or
provide for the payment of loans contracted or moneys due.
(d) Subject to the provisions of section 12488, such as is
purchased at sales under mortgages or judgments for such loans or
moneys.
(e) Subject to the provisions of section 12488, such as is
conveyed to it in full or partial satisfaction of any debts
previously contracted in the course of its dealings.
(f) Subject to the provisions of section 12488, such as is
acquired by it by virtue of the provisions of any mortgage policy
issued by it or for its protection from loss under such policy.
(g) Subject to the provisions of section 12488 such as is conveyed
to it by a trustee under the provisions of a mortgage participation
trust created by it.
(h) Subject to the provisions of section 12488, all such other
real estate as in the opinion of the board of directors of the
insurer may be necessary or desirable for the protection or
enhancement of the value of any property owned by such insurer or
held in any mortgage participation trust, if the acquisition thereof
is first approved in writing by the commissioner.
12487. All real estate held by a mortgage insurer may be sold,
conveyed or exchanged by it. Property received by it upon such sale
or exchange need not be of the classes permitted for investment by
this article, but, except with the consent of the commissioner, an
exchange shall not be made which results in increasing the total
amount of all encumbrances then outstanding against the assets of the
insurer.
12488. After five years have elapsed from the date of the
acquisition by any insurer of any real estate acquired under the
provisions of subdivisions (d), (e), (f), (g) and (h) of section
12486 and as well any real estate obtained on the sale or exchange
thereof, the commissioner may, in his discretion, require such
insurer to set up on its books a reserve account for such real estate
in such an amount as he may designate, but not in excess of the cost
value at which such assets are carried on the books.
12489. A mortgage insurer may purchase furniture or other personal
property in order to operate or sell any real estate, if such
purchase is advisable in the opinion of the officers of such insurer.
A mortgage insurer may make such expenditure as its officers deem
advisable in the repair, maintenance or improvement of any real
estate acquired by it, including the construction of buildings
thereon.
12490. Irrespective of any other provision of this code, a mortgage
insurer may invest in, hold, buy and sell and make collateral loans
secured by shares of stock, bonds, notes, debentures or other
obligations of any national mortgage association or other similar
credit institution now or hereafter organized under the National
Housing Act and any amendments thereto; also the stock, bonds,
debentures, notes and other securities or instruments issued by any
Federal agency or corporation organized under Federal authority whose
powers include loaning money on real estate or guaranteeing or
insuring loans on real estate or otherwise dealing in such loans.
Irrespective of any other provision of this code, a mortgage
insurer (a) either with or without security, may make loans, advance
credit, and purchase obligations representing loans and advances of
credit, for the purpose of financing alterations, repairs, and
improvements pursuant to the National Housing Act and any amendments
thereto upon real property securing a loan then held by or insured by
such mortgage insurer, if the Federal Housing Administrator shall
insure such mortgage insurer against losses which it may sustain as a
result of such loans, advances of credit and purchases made by such
mortgage insurer for such purpose to the extent provided in Title I
of the National Housing Act and any amendments thereto; (b) may make
loans upon the security of real property pursuant to the Federal
Housing Act and any amendments thereto, if the Federal Housing
Administrator pursuant to said act shall have insured, or shall have
made a commitment to insure, such mortgage insurer against losses of
principal which it may sustain as a result of such loans; and (c) may
secure insurance pursuant to said National Housing Act and any
amendments thereto. No law of this State prescribing the nature,
amount or form of security or requiring security upon which loans or
advances of credit may be made or prescribing or limiting the period
for which loans or advances of credit may be made, and no provision
of this code prescribing or limiting interest rates upon loans or
advances of credit, shall apply to loans, advances of credit or
purchases made pursuant to this section.
12480. A mortgage insurer shall not make or purchase any
investments or loans except as authorized by this chapter unless:
(a) The loan or investment was legally made or purchased by the
insurer before August 21, 1933.
(b) The loan is a renewal or extension of any loan legally made
before August 21, 1933.
12481. A mortgage insurer shall not, directly or indirectly, make
any loan to any of its officers, directors or other employees.
12482. A mortgage insurer shall invest in, hold or own any of the
capital stock of any other corporation or make any loan, in whole or
in part, on security of such stock only as expressly permitted by
this article.
12483. In connection with its investment in an authorized real
estate security, a mortgage insurer may, in its own name as pledgee,
take stock, in a water or power corporation, where such stock
represents the right to receive or obtain water or power for
beneficial use on the real estate securing its investment, whether or
not such right is appurtenant to the investment. The insurer may
hold, use, or dispose of any such stock for the benefit and
protection of such investment.
12484. A mortgage insurer may invest in, hold, buy and sell, and
may make collateral loans secured by:
(a) The securities specified in sections 1170 to 1175, inclusive.
(b) Authorized real estate securities, but not in excess of
fifteen per cent of the insurer's paid-in capital in any one
security.
(c) Securities, the payment of which is insured by itself or
another domestic admitted mortgage insurer, and mortgage
participation certificates issued by itself or another insurer
pursuant to this chapter.
(d) Collateral trust bonds or notes secured by deposit with a
trustee of securities authorized for investment by this article if
such securities have a market value at least equal to one hundred
fifteen per cent of the par value of the collateral trust bonds or
notes then outstanding.
(e) The stock issued by any Federal Home Loan Bank or other
similar Federal agency of which such mortgage insurer is eligible to
become a member, and the bonds, debentures and notes issued by any
Federal Home Loan Bank or other similar Federal agency.
(f) Bonds of a metropolitan water district.
(g) Stock of any corporation organized under the laws of
California to transact the business of insurance agent or insurance
broker; but a mortgage insurer shall not invest in the stock of such
corporation unless it acquires at least fifty-one per cent of the
voting stock thereof; provided, further, no insurer shall acquire, or
purchase any stock pursuant to the provisions of this paragraph
without having first obtained the approval in writing of the
commissioner.
(h) Stocks, bonds, debentures, or other securities of any
corporation where the same or any thereof are acquired by a mortgage
insurer in full or partial satisfaction of a debt previously
contracted or an obligation previously acquired in good faith and
owned or insured by such insurer, or in exchange for any such debt or
obligation; also stocks, bonds, debentures, or other securities of
any corporation where the same or any thereof are acquired in
connection with the sale or liquidation of any real estate owned by
such insurer or held in any mortgage participation trust of such
insurer, also stocks, bonds, debentures, or other securities of any
corporation where the same or any thereof are acquired in connection
with or as a part of any plan or agreement of reorganization,
readjustment or rehabilitation of such insurer, which plan or
agreement has been approved in the manner required by any present or
future law or in connection with the amendment, modification or
termination in a manner provided by any present or future law of any
or all mortgage participation certificates issued by such insurer or
of all or any part of the mortgage participation trusts created by
such insurer; also stocks, bonds, debentures, or other securities of
any corporation organized to take over and acquire all or any part of
the assets of such mortgage insurer and all or any part of the
assets of any existing mortgage participation trust or trusts created
by such insurer; provided, however, no mortgage insurer shall
acquire or invest in stocks, bonds, debentures, or other securities
of any corporation in an amount greater than ten per cent of the then
authorized, issued and outstanding capital stock of such mortgage
insurer or in an amount greater than $25,000, without having first
obtained the written consent of the commissioner.
(i) Any note or notes secured by a second mortgage or second deed
of trust where such note is acquired in full or partial satisfaction
of a debt, or in the sale or liquidation of any asset acquired in
connection with the full or partial satisfaction of any debt.
A mortgage insurer may renew or extend any loan heretofore legally
made or purchased or accept and hold any purchase money mortgage or
deed of trust in connection with the liquidation of any real estate.
12485. Mortgage insurers may make deposits with any bank or savings
and loan associations the accounts of which are insured by an agency
or instrumentality of the federal government. The making and
maintenance of such deposits and investments is not subject to
restrictions relating to investments.
12486. Any mortgage insurer may purchase and hold or convey real
estate of the following character only:
(a) Subject to the limit on aggregate cost contained in
subdivision (b), the land, with improvements thereon, on which its
office is located, if the cost of the land together with improvements
does not exceed twenty-five per cent of its paid-in capital.
(b) Such as is requisite for its accommodation in the convenient
transaction of its business. The aggregate cost of real estate with
improvements acquired under the authority granted in subdivisions (a)
and (b) shall not exceed twenty-five per cent of its paid-in
capital.
(c) Such as is conveyed to it or to any person for it to secure or
provide for the payment of loans contracted or moneys due.
(d) Subject to the provisions of section 12488, such as is
purchased at sales under mortgages or judgments for such loans or
moneys.
(e) Subject to the provisions of section 12488, such as is
conveyed to it in full or partial satisfaction of any debts
previously contracted in the course of its dealings.
(f) Subject to the provisions of section 12488, such as is
acquired by it by virtue of the provisions of any mortgage policy
issued by it or for its protection from loss under such policy.
(g) Subject to the provisions of section 12488 such as is conveyed
to it by a trustee under the provisions of a mortgage participation
trust created by it.
(h) Subject to the provisions of section 12488, all such other
real estate as in the opinion of the board of directors of the
insurer may be necessary or desirable for the protection or
enhancement of the value of any property owned by such insurer or
held in any mortgage participation trust, if the acquisition thereof
is first approved in writing by the commissioner.
12487. All real estate held by a mortgage insurer may be sold,
conveyed or exchanged by it. Property received by it upon such sale
or exchange need not be of the classes permitted for investment by
this article, but, except with the consent of the commissioner, an
exchange shall not be made which results in increasing the total
amount of all encumbrances then outstanding against the assets of the
insurer.
12488. After five years have elapsed from the date of the
acquisition by any insurer of any real estate acquired under the
provisions of subdivisions (d), (e), (f), (g) and (h) of section
12486 and as well any real estate obtained on the sale or exchange
thereof, the commissioner may, in his discretion, require such
insurer to set up on its books a reserve account for such real estate
in such an amount as he may designate, but not in excess of the cost
value at which such assets are carried on the books.
12489. A mortgage insurer may purchase furniture or other personal
property in order to operate or sell any real estate, if such
purchase is advisable in the opinion of the officers of such insurer.
A mortgage insurer may make such expenditure as its officers deem
advisable in the repair, maintenance or improvement of any real
estate acquired by it, including the construction of buildings
thereon.
12490. Irrespective of any other provision of this code, a mortgage
insurer may invest in, hold, buy and sell and make collateral loans
secured by shares of stock, bonds, notes, debentures or other
obligations of any national mortgage association or other similar
credit institution now or hereafter organized under the National
Housing Act and any amendments thereto; also the stock, bonds,
debentures, notes and other securities or instruments issued by any
Federal agency or corporation organized under Federal authority whose
powers include loaning money on real estate or guaranteeing or
insuring loans on real estate or otherwise dealing in such loans.
Irrespective of any other provision of this code, a mortgage
insurer (a) either with or without security, may make loans, advance
credit, and purchase obligations representing loans and advances of
credit, for the purpose of financing alterations, repairs, and
improvements pursuant to the National Housing Act and any amendments
thereto upon real property securing a loan then held by or insured by
such mortgage insurer, if the Federal Housing Administrator shall
insure such mortgage insurer against losses which it may sustain as a
result of such loans, advances of credit and purchases made by such
mortgage insurer for such purpose to the extent provided in Title I
of the National Housing Act and any amendments thereto; (b) may make
loans upon the security of real property pursuant to the Federal
Housing Act and any amendments thereto, if the Federal Housing
Administrator pursuant to said act shall have insured, or shall have
made a commitment to insure, such mortgage insurer against losses of
principal which it may sustain as a result of such loans; and (c) may
secure insurance pursuant to said National Housing Act and any
amendments thereto. No law of this State prescribing the nature,
amount or form of security or requiring security upon which loans or
advances of credit may be made or prescribing or limiting the period
for which loans or advances of credit may be made, and no provision
of this code prescribing or limiting interest rates upon loans or
advances of credit, shall apply to loans, advances of credit or
purchases made pursuant to this section.
12480. A mortgage insurer shall not make or purchase any
investments or loans except as authorized by this chapter unless:
(a) The loan or investment was legally made or purchased by the
insurer before August 21, 1933.
(b) The loan is a renewal or extension of any loan legally made
before August 21, 1933.
12481. A mortgage insurer shall not, directly or indirectly, make
any loan to any of its officers, directors or other employees.
12482. A mortgage insurer shall invest in, hold or own any of the
capital stock of any other corporation or make any loan, in whole or
in part, on security of such stock only as expressly permitted by
this article.
12483. In connection with its investment in an authorized real
estate security, a mortgage insurer may, in its own name as pledgee,
take stock, in a water or power corporation, where such stock
represents the right to receive or obtain water or power for
beneficial use on the real estate securing its investment, whether or
not such right is appurtenant to the investment. The insurer may
hold, use, or dispose of any such stock for the benefit and
protection of such investment.
12484. A mortgage insurer may invest in, hold, buy and sell, and
may make collateral loans secured by:
(a) The securities specified in sections 1170 to 1175, inclusive.
(b) Authorized real estate securities, but not in excess of
fifteen per cent of the insurer's paid-in capital in any one
security.
(c) Securities, the payment of which is insured by itself or
another domestic admitted mortgage insurer, and mortgage
participation certificates issued by itself or another insurer
pursuant to this chapter.
(d) Collateral trust bonds or notes secured by deposit with a
trustee of securities authorized for investment by this article if
such securities have a market value at least equal to one hundred
fifteen per cent of the par value of the collateral trust bonds or
notes then outstanding.
(e) The stock issued by any Federal Home Loan Bank or other
similar Federal agency of which such mortgage insurer is eligible to
become a member, and the bonds, debentures and notes issued by any
Federal Home Loan Bank or other similar Federal agency.
(f) Bonds of a metropolitan water district.
(g) Stock of any corporation organized under the laws of
California to transact the business of insurance agent or insurance
broker; but a mortgage insurer shall not invest in the stock of such
corporation unless it acquires at least fifty-one per cent of the
voting stock thereof; provided, further, no insurer shall acquire, or
purchase any stock pursuant to the provisions of this paragraph
without having first obtained the approval in writing of the
commissioner.
(h) Stocks, bonds, debentures, or other securities of any
corporation where the same or any thereof are acquired by a mortgage
insurer in full or partial satisfaction of a debt previously
contracted or an obligation previously acquired in good faith and
owned or insured by such insurer, or in exchange for any such debt or
obligation; also stocks, bonds, debentures, or other securities of
any corporation where the same or any thereof are acquired in
connection with the sale or liquidation of any real estate owned by
such insurer or held in any mortgage participation trust of such
insurer, also stocks, bonds, debentures, or other securities of any
corporation where the same or any thereof are acquired in connection
with or as a part of any plan or agreement of reorganization,
readjustment or rehabilitation of such insurer, which plan or
agreement has been approved in the manner required by any present or
future law or in connection with the amendment, modification or
termination in a manner provided by any present or future law of any
or all mortgage participation certificates issued by such insurer or
of all or any part of the mortgage participation trusts created by
such insurer; also stocks, bonds, debentures, or other securities of
any corporation organized to take over and acquire all or any part of
the assets of such mortgage insurer and all or any part of the
assets of any existing mortgage participation trust or trusts created
by such insurer; provided, however, no mortgage insurer shall
acquire or invest in stocks, bonds, debentures, or other securities
of any corporation in an amount greater than ten per cent of the then
authorized, issued and outstanding capital stock of such mortgage
insurer or in an amount greater than $25,000, without having first
obtained the written consent of the commissioner.
(i) Any note or notes secured by a second mortgage or second deed
of trust where such note is acquired in full or partial satisfaction
of a debt, or in the sale or liquidation of any asset acquired in
connection with the full or partial satisfaction of any debt.
A mortgage insurer may renew or extend any loan heretofore legally
made or purchased or accept and hold any purchase money mortgage or
deed of trust in connection with the liquidation of any real estate.
12485. Mortgage insurers may make deposits with any bank or savings
and loan associations the accounts of which are insured by an agency
or instrumentality of the federal government. The making and
maintenance of such deposits and investments is not subject to
restrictions relating to investments.
12486. Any mortgage insurer may purchase and hold or convey real
estate of the following character only:
(a) Subject to the limit on aggregate cost contained in
subdivision (b), the land, with improvements thereon, on which its
office is located, if the cost of the land together with improvements
does not exceed twenty-five per cent of its paid-in capital.
(b) Such as is requisite for its accommodation in the convenient
transaction of its business. The aggregate cost of real estate with
improvements acquired under the authority granted in subdivisions (a)
and (b) shall not exceed twenty-five per cent of its paid-in
capital.
(c) Such as is conveyed to it or to any person for it to secure or
provide for the payment of loans contracted or moneys due.
(d) Subject to the provisions of section 12488, such as is
purchased at sales under mortgages or judgments for such loans or
moneys.
(e) Subject to the provisions of section 12488, such as is
conveyed to it in full or partial satisfaction of any debts
previously contracted in the course of its dealings.
(f) Subject to the provisions of section 12488, such as is
acquired by it by virtue of the provisions of any mortgage policy
issued by it or for its protection from loss under such policy.
(g) Subject to the provisions of section 12488 such as is conveyed
to it by a trustee under the provisions of a mortgage participation
trust created by it.
(h) Subject to the provisions of section 12488, all such other
real estate as in the opinion of the board of directors of the
insurer may be necessary or desirable for the protection or
enhancement of the value of any property owned by such insurer or
held in any mortgage participation trust, if the acquisition thereof
is first approved in writing by the commissioner.
12487. All real estate held by a mortgage insurer may be sold,
conveyed or exchanged by it. Property received by it upon such sale
or exchange need not be of the classes permitted for investment by
this article, but, except with the consent of the commissioner, an
exchange shall not be made which results in increasing the total
amount of all encumbrances then outstanding against the assets of the
insurer.
12488. After five years have elapsed from the date of the
acquisition by any insurer of any real estate acquired under the
provisions of subdivisions (d), (e), (f), (g) and (h) of section
12486 and as well any real estate obtained on the sale or exchange
thereof, the commissioner may, in his discretion, require such
insurer to set up on its books a reserve account for such real estate
in such an amount as he may designate, but not in excess of the cost
value at which such assets are carried on the books.
12489. A mortgage insurer may purchase furniture or other personal
property in order to operate or sell any real estate, if such
purchase is advisable in the opinion of the officers of such insurer.
A mortgage insurer may make such expenditure as its officers deem
advisable in the repair, maintenance or improvement of any real
estate acquired by it, including the construction of buildings
thereon.
12490. Irrespective of any other provision of this code, a mortgage
insurer may invest in, hold, buy and sell and make collateral loans
secured by shares of stock, bonds, notes, debentures or other
obligations of any national mortgage association or other similar
credit institution now or hereafter organized under the National
Housing Act and any amendments thereto; also the stock, bonds,
debentures, notes and other securities or instruments issued by any
Federal agency or corporation organized under Federal authority whose
powers include loaning money on real estate or guaranteeing or
insuring loans on real estate or otherwise dealing in such loans.
Irrespective of any other provision of this code, a mortgage
insurer (a) either with or without security, may make loans, advance
credit, and purchase obligations representing loans and advances of
credit, for the purpose of financing alterations, repairs, and
improvements pursuant to the National Housing Act and any amendments
thereto upon real property securing a loan then held by or insured by
such mortgage insurer, if the Federal Housing Administrator shall
insure such mortgage insurer against losses which it may sustain as a
result of such loans, advances of credit and purchases made by such
mortgage insurer for such purpose to the extent provided in Title I
of the National Housing Act and any amendments thereto; (b) may make
loans upon the security of real property pursuant to the Federal
Housing Act and any amendments thereto, if the Federal Housing
Administrator pursuant to said act shall have insured, or shall have
made a commitment to insure, such mortgage insurer against losses of
principal which it may sustain as a result of such loans; and (c) may
secure insurance pursuant to said National Housing Act and any
amendments thereto. No law of this State prescribing the nature,
amount or form of security or requiring security upon which loans or
advances of credit may be made or prescribing or limiting the period
for which loans or advances of credit may be made, and no provision
of this code prescribing or limiting interest rates upon loans or
advances of credit, shall apply to loans, advances of credit or
purchases made pursuant to this section.
