F. Downpayment Loan Program

 

[§201H-161]  Downpayment loans.  (a) The corporation may make direct downpayment loans to eligible borrowers whoqualify for loans under section 201H-162.  The downpayment loan to any oneborrower shall not exceed thirty per cent of the purchase price of theresidential property or $15,000, whichever is less.  The interest rate on theloans may range from zero per cent to eight per cent, depending on the buyer'sincome.

(b)  The repayment of every downpayment loanshall be secured by a duly recorded second mortgage executed by the borrower tothe State on the residential property purchased with the downpayment loan.

(c)  The principal of the downpayment loan,together with accrued interest, shall be due and payable upon the sale,transfer, or refinancing of the property, or shall be repaid by the borrower ininstallments as determined by the corporation; provided that the corporationmay provide a period in which payments may be waived.  The period over whichthe principal and interest shall be paid need not coincide with the period overwhich the loan from the mortgage lender for the balance of the purchase pricemust be repaid.  The borrower may repay the whole or any part of the unpaidbalance of the downpayment loan, plus accrued interest, at any time withoutpenalty.

(d)  The corporation may secure the services ofthe mortgage lender who loans to the borrower the balance of the purchase priceof the residential property or the services of any other mortgage lender doingbusiness in the State to collect, on behalf of the State, the principal andinterest of the downpayment loan and otherwise to service the downpayment loan,for a servicing fee not in excess of the prevailing loan servicing fees.

(e)  The corporation shall adopt rules pursuantto chapter 91 to carry out the purposes of this subpart. [L 2006, c 180, pt of§4]