(a) The Agency may uponapplication of a proposed mortgagee insure and make advance commitments toinsure payments required by a loan for residential housing for persons of lowerincome upon such terms and conditions as the Agency may prescribe. Mortgageloans insured by the Agency under this Chapter may provide financing forrelated ancillary facilities to the extent permitted by applicable Agencyregulations. Mortgage loans insured by the Agency under this Chapter shall besecured by a first mortgage.
The aggregate principal amountof all mortgages so insured by the Agency under this Chapter and outstanding atany one time shall not exceed 10 times the average annual balance for thepreceding calendar year of funds on deposit in the housing mortgage insurancefund, the creation of which is hereby authorized. The aggregate amount ofprincipal obligations of all mortgages so insured shall not be deemed toconstitute a debt, liability or obligation of the State or of any politicalsubdivision thereof or a pledge of the faith and credit of the State or of anysuch political subdivision, but shall be payable solely from moneys on depositto the credit of the housing mortgage insurance fund. Any contract of insuranceexecuted by the Agency under this section shall be conclusive evidence ofeligibility for such mortgage insurance and the validity of any contract ofinsurance so executed or of an advance commitment to issue such shall beincontestable in the hands of a mortgagee from the date of execution of suchcontract or commitment, except for fraud or misrepresentation on the part ofsuch mortgagee and, as to commitments to insure, noncompliance with the termsof the advance commitment or Agency regulations in force at the time ofissuance of the advance commitment.
(b) For mortgagepayments to be eligible for insurance under the provisions of this Chapter, theunderlying mortgage loan shall:
(1) Be one which is madeand held by a mortgagee approved by the Agency as responsible and able toservice the mortgage properly;
(2) Not exceed (i)ninety percent (90%) of the estimated cost of the proposed housing if owned orto be owned by a profit‑ making sponsor or (ii) one hundred percent(100%) of the estimated cost of such proposed housing if owned or to be ownedby a nonprofit housing sponsor or, if owned by a person or family of lowerincome, in the case of a single family dwelling or condominium;
(3) Have a maturitysatisfactory to the Agency but in no case longer than eighty percent (80%) ofthe Corporation's [Agency's] estimate of the remaining useful life of saidhousing or 40 years from the date of the issuance of insurance, whichever isearlier;
(4) Contain amortizationprovisions satisfactory to the Agency requiring periodic payments by themortgagor not in excess of his ability to pay as determined by the Agency;
(5) Be in such form andcontain such terms and provisions with respect to maturity, property insurance,repairs, alterations, payment of taxes and assessments, default reserves,delinquency charges, default remedies, anticipation of maturity, additional andsecondary liens, equitable and legal redemption rights, prepayment privilegesand other matters as the Agency may prescribe.
(c) All applicationsfor mortgage insurance shall be forwarded, together with an application feeprescribed by the Agency, to the executive director of the Agency. The Agencyshall cause an investigation of the proposed housing to be made, review theapplication and the report of the investigation, and approve or deny theapplication. No application shall be approved unless the Agency finds that itis consistent with the purposes of this Chapter and further finds that thefinancing plan for the proposed housing is sound. The Agency shall notify theapplicant and the proposed lender of its decision. Any such approval shall beconditioned upon payment to the Agency, within such reasonable time and afternotification of approval as may be specified by the Agency, of the commitmentfee prescribed by the Agency.
(d) The Agency shallfix mortgage insurance premiums for the insurance of mortgage payments underthe provision of this Chapter. Such premiums shall be computed as a percentageof the principal of the mortgage outstanding at the beginning of each mortgageyear, but shall not be more than one half of one percent (1/2 of 1%) per yearof such principal amount. The amount of premium need not be uniform for allinsured loans. Such premiums shall be payable by mortgagors or mortgagees insuch manner as prescribed by the Agency.
(e) In the event ofdefault by the mortgagor, the mortgagee shall notify the Agency both of thedefault and the mortgagee's proposed course of action. When it appearsfeasible, the Agency may for a temporary period upon default or threateneddefault by the mortgagor authorize mortgage payments to be made by the Agencyto the mortgagee which payments shall be repaid under such conditions as theAgency may prescribe. The Agency may also agree to revised terms of financing whensuch appear prudent. The mortgagee shall be entitled to receive the benefits ofthe insurance provided herein upon:
(1) Any sale of themortgaged property by court order in foreclosure or a sale with the consent ofthe Agency by the mortgagor or a subsequent owner of the property or by themortgagee after foreclosure or acquisition by deed in lieu of foreclosure,provided all claims of the mortgagee against the mortgagor or others arisingfrom the mortgage, foreclosure, or any deficiency judgment shall be assigned tothe Agency without recourse except such claims as may have been released withthe consent of the Agency; or
(2) The expiration ofsix months after the mortgagee has taken title to the mortgaged property underjudgment of strict foreclosure, foreclosure by sale or other judicial sale, orunder a deed in lieu of foreclosure if during such period the mortgagee hasmade a bona fide attempt to sell the property, and thereafter conveys theproperty to the Agency with an assignment, without recourse, to the Agency ofall claims of the mortgagee against the mortgagor or others arising out of themortgage foreclosure, or deficiency judgment; or
(3) The acceptance bythe Agency of title to the property or an assignment of the mortgage, withoutrecourse to the Agency, in the event the Agency determines it imprudent toproceed under (1) or (2) above.
Upon the occurrence of either(1), (2) or (3) hereof, the obligation of the mortgagee to pay premium chargesfor insurance shall cease, and the Agency shall, within 30 days thereafter, payto the mortgagee ninety‑eight percent (98%) of the sum of (i) the thenunpaid principal balance of the insured indebtedness, (ii) the unpaid interestto the date of conveyance or assignment to the Agency, as the case may be, (iii)the amount of all payments made by the mortgagee for which it has not beenreimbursed for taxes, insurance, assessments and mortgage insurance premiums,and (iv) such other necessary fees, costs or expenses of the mortgagee as maybe approved by the Agency.
(f) Upon request ofthe mortgagee, the Agency may at any time, under such terms and conditions asit may prescribe, consent to the release of the mortgagor from his liability orconsent to the release of parts of the property from the lien of the mortgage,or approve a substitute mortgagor or sale of the property or part thereof.
(g) No claim for thebenefit of the insurance provided in this Chapter shall be accepted by theAgency except within one year after any sale or acquisition of title of the mortgagedpremises described in subdivisions (1) or (2) of subsection (e) of thissection.
(h) There shall be paidinto the housing mortgage insurance fund (i) all premiums received by theAgency for the granting of such mortgage insurance, (ii) any moneys or otherassets received by the Agency as a result of default or delinquency on mortgageloans insured by the Agency, including any proceeds from the sale or lease ofreal property, (iii) any moneys appropriated and made available by the Statefor the purpose of such fund. (1973, c. 1296, s. 45.)
(a) The Agency may uponapplication of a proposed mortgagee insure and make advance commitments toinsure payments required by a loan for residential housing for persons of lowerincome upon such terms and conditions as the Agency may prescribe. Mortgageloans insured by the Agency under this Chapter may provide financing forrelated ancillary facilities to the extent permitted by applicable Agencyregulations. Mortgage loans insured by the Agency under this Chapter shall besecured by a first mortgage.
The aggregate principal amountof all mortgages so insured by the Agency under this Chapter and outstanding atany one time shall not exceed 10 times the average annual balance for thepreceding calendar year of funds on deposit in the housing mortgage insurancefund, the creation of which is hereby authorized. The aggregate amount ofprincipal obligations of all mortgages so insured shall not be deemed toconstitute a debt, liability or obligation of the State or of any politicalsubdivision thereof or a pledge of the faith and credit of the State or of anysuch political subdivision, but shall be payable solely from moneys on depositto the credit of the housing mortgage insurance fund. Any contract of insuranceexecuted by the Agency under this section shall be conclusive evidence ofeligibility for such mortgage insurance and the validity of any contract ofinsurance so executed or of an advance commitment to issue such shall beincontestable in the hands of a mortgagee from the date of execution of suchcontract or commitment, except for fraud or misrepresentation on the part ofsuch mortgagee and, as to commitments to insure, noncompliance with the termsof the advance commitment or Agency regulations in force at the time ofissuance of the advance commitment.
(b) For mortgagepayments to be eligible for insurance under the provisions of this Chapter, theunderlying mortgage loan shall:
(1) Be one which is madeand held by a mortgagee approved by the Agency as responsible and able toservice the mortgage properly;
(2) Not exceed (i)ninety percent (90%) of the estimated cost of the proposed housing if owned orto be owned by a profit‑ making sponsor or (ii) one hundred percent(100%) of the estimated cost of such proposed housing if owned or to be ownedby a nonprofit housing sponsor or, if owned by a person or family of lowerincome, in the case of a single family dwelling or condominium;
(3) Have a maturitysatisfactory to the Agency but in no case longer than eighty percent (80%) ofthe Corporation's [Agency's] estimate of the remaining useful life of saidhousing or 40 years from the date of the issuance of insurance, whichever isearlier;
(4) Contain amortizationprovisions satisfactory to the Agency requiring periodic payments by themortgagor not in excess of his ability to pay as determined by the Agency;
(5) Be in such form andcontain such terms and provisions with respect to maturity, property insurance,repairs, alterations, payment of taxes and assessments, default reserves,delinquency charges, default remedies, anticipation of maturity, additional andsecondary liens, equitable and legal redemption rights, prepayment privilegesand other matters as the Agency may prescribe.
(c) All applicationsfor mortgage insurance shall be forwarded, together with an application feeprescribed by the Agency, to the executive director of the Agency. The Agencyshall cause an investigation of the proposed housing to be made, review theapplication and the report of the investigation, and approve or deny theapplication. No application shall be approved unless the Agency finds that itis consistent with the purposes of this Chapter and further finds that thefinancing plan for the proposed housing is sound. The Agency shall notify theapplicant and the proposed lender of its decision. Any such approval shall beconditioned upon payment to the Agency, within such reasonable time and afternotification of approval as may be specified by the Agency, of the commitmentfee prescribed by the Agency.
(d) The Agency shallfix mortgage insurance premiums for the insurance of mortgage payments underthe provision of this Chapter. Such premiums shall be computed as a percentageof the principal of the mortgage outstanding at the beginning of each mortgageyear, but shall not be more than one half of one percent (1/2 of 1%) per yearof such principal amount. The amount of premium need not be uniform for allinsured loans. Such premiums shall be payable by mortgagors or mortgagees insuch manner as prescribed by the Agency.
(e) In the event ofdefault by the mortgagor, the mortgagee shall notify the Agency both of thedefault and the mortgagee's proposed course of action. When it appearsfeasible, the Agency may for a temporary period upon default or threateneddefault by the mortgagor authorize mortgage payments to be made by the Agencyto the mortgagee which payments shall be repaid under such conditions as theAgency may prescribe. The Agency may also agree to revised terms of financing whensuch appear prudent. The mortgagee shall be entitled to receive the benefits ofthe insurance provided herein upon:
(1) Any sale of themortgaged property by court order in foreclosure or a sale with the consent ofthe Agency by the mortgagor or a subsequent owner of the property or by themortgagee after foreclosure or acquisition by deed in lieu of foreclosure,provided all claims of the mortgagee against the mortgagor or others arisingfrom the mortgage, foreclosure, or any deficiency judgment shall be assigned tothe Agency without recourse except such claims as may have been released withthe consent of the Agency; or
(2) The expiration ofsix months after the mortgagee has taken title to the mortgaged property underjudgment of strict foreclosure, foreclosure by sale or other judicial sale, orunder a deed in lieu of foreclosure if during such period the mortgagee hasmade a bona fide attempt to sell the property, and thereafter conveys theproperty to the Agency with an assignment, without recourse, to the Agency ofall claims of the mortgagee against the mortgagor or others arising out of themortgage foreclosure, or deficiency judgment; or
(3) The acceptance bythe Agency of title to the property or an assignment of the mortgage, withoutrecourse to the Agency, in the event the Agency determines it imprudent toproceed under (1) or (2) above.
Upon the occurrence of either(1), (2) or (3) hereof, the obligation of the mortgagee to pay premium chargesfor insurance shall cease, and the Agency shall, within 30 days thereafter, payto the mortgagee ninety‑eight percent (98%) of the sum of (i) the thenunpaid principal balance of the insured indebtedness, (ii) the unpaid interestto the date of conveyance or assignment to the Agency, as the case may be, (iii)the amount of all payments made by the mortgagee for which it has not beenreimbursed for taxes, insurance, assessments and mortgage insurance premiums,and (iv) such other necessary fees, costs or expenses of the mortgagee as maybe approved by the Agency.
(f) Upon request ofthe mortgagee, the Agency may at any time, under such terms and conditions asit may prescribe, consent to the release of the mortgagor from his liability orconsent to the release of parts of the property from the lien of the mortgage,or approve a substitute mortgagor or sale of the property or part thereof.
(g) No claim for thebenefit of the insurance provided in this Chapter shall be accepted by theAgency except within one year after any sale or acquisition of title of the mortgagedpremises described in subdivisions (1) or (2) of subsection (e) of thissection.
(h) There shall be paidinto the housing mortgage insurance fund (i) all premiums received by theAgency for the granting of such mortgage insurance, (ii) any moneys or otherassets received by the Agency as a result of default or delinquency on mortgageloans insured by the Agency, including any proceeds from the sale or lease ofreal property, (iii) any moneys appropriated and made available by the Statefor the purpose of such fund. (1973, c. 1296, s. 45.)
(a) The Agency may uponapplication of a proposed mortgagee insure and make advance commitments toinsure payments required by a loan for residential housing for persons of lowerincome upon such terms and conditions as the Agency may prescribe. Mortgageloans insured by the Agency under this Chapter may provide financing forrelated ancillary facilities to the extent permitted by applicable Agencyregulations. Mortgage loans insured by the Agency under this Chapter shall besecured by a first mortgage.
The aggregate principal amountof all mortgages so insured by the Agency under this Chapter and outstanding atany one time shall not exceed 10 times the average annual balance for thepreceding calendar year of funds on deposit in the housing mortgage insurancefund, the creation of which is hereby authorized. The aggregate amount ofprincipal obligations of all mortgages so insured shall not be deemed toconstitute a debt, liability or obligation of the State or of any politicalsubdivision thereof or a pledge of the faith and credit of the State or of anysuch political subdivision, but shall be payable solely from moneys on depositto the credit of the housing mortgage insurance fund. Any contract of insuranceexecuted by the Agency under this section shall be conclusive evidence ofeligibility for such mortgage insurance and the validity of any contract ofinsurance so executed or of an advance commitment to issue such shall beincontestable in the hands of a mortgagee from the date of execution of suchcontract or commitment, except for fraud or misrepresentation on the part ofsuch mortgagee and, as to commitments to insure, noncompliance with the termsof the advance commitment or Agency regulations in force at the time ofissuance of the advance commitment.
(b) For mortgagepayments to be eligible for insurance under the provisions of this Chapter, theunderlying mortgage loan shall:
(1) Be one which is madeand held by a mortgagee approved by the Agency as responsible and able toservice the mortgage properly;
(2) Not exceed (i)ninety percent (90%) of the estimated cost of the proposed housing if owned orto be owned by a profit‑ making sponsor or (ii) one hundred percent(100%) of the estimated cost of such proposed housing if owned or to be ownedby a nonprofit housing sponsor or, if owned by a person or family of lowerincome, in the case of a single family dwelling or condominium;
(3) Have a maturitysatisfactory to the Agency but in no case longer than eighty percent (80%) ofthe Corporation's [Agency's] estimate of the remaining useful life of saidhousing or 40 years from the date of the issuance of insurance, whichever isearlier;
(4) Contain amortizationprovisions satisfactory to the Agency requiring periodic payments by themortgagor not in excess of his ability to pay as determined by the Agency;
(5) Be in such form andcontain such terms and provisions with respect to maturity, property insurance,repairs, alterations, payment of taxes and assessments, default reserves,delinquency charges, default remedies, anticipation of maturity, additional andsecondary liens, equitable and legal redemption rights, prepayment privilegesand other matters as the Agency may prescribe.
(c) All applicationsfor mortgage insurance shall be forwarded, together with an application feeprescribed by the Agency, to the executive director of the Agency. The Agencyshall cause an investigation of the proposed housing to be made, review theapplication and the report of the investigation, and approve or deny theapplication. No application shall be approved unless the Agency finds that itis consistent with the purposes of this Chapter and further finds that thefinancing plan for the proposed housing is sound. The Agency shall notify theapplicant and the proposed lender of its decision. Any such approval shall beconditioned upon payment to the Agency, within such reasonable time and afternotification of approval as may be specified by the Agency, of the commitmentfee prescribed by the Agency.
(d) The Agency shallfix mortgage insurance premiums for the insurance of mortgage payments underthe provision of this Chapter. Such premiums shall be computed as a percentageof the principal of the mortgage outstanding at the beginning of each mortgageyear, but shall not be more than one half of one percent (1/2 of 1%) per yearof such principal amount. The amount of premium need not be uniform for allinsured loans. Such premiums shall be payable by mortgagors or mortgagees insuch manner as prescribed by the Agency.
(e) In the event ofdefault by the mortgagor, the mortgagee shall notify the Agency both of thedefault and the mortgagee's proposed course of action. When it appearsfeasible, the Agency may for a temporary period upon default or threateneddefault by the mortgagor authorize mortgage payments to be made by the Agencyto the mortgagee which payments shall be repaid under such conditions as theAgency may prescribe. The Agency may also agree to revised terms of financing whensuch appear prudent. The mortgagee shall be entitled to receive the benefits ofthe insurance provided herein upon:
(1) Any sale of themortgaged property by court order in foreclosure or a sale with the consent ofthe Agency by the mortgagor or a subsequent owner of the property or by themortgagee after foreclosure or acquisition by deed in lieu of foreclosure,provided all claims of the mortgagee against the mortgagor or others arisingfrom the mortgage, foreclosure, or any deficiency judgment shall be assigned tothe Agency without recourse except such claims as may have been released withthe consent of the Agency; or
(2) The expiration ofsix months after the mortgagee has taken title to the mortgaged property underjudgment of strict foreclosure, foreclosure by sale or other judicial sale, orunder a deed in lieu of foreclosure if during such period the mortgagee hasmade a bona fide attempt to sell the property, and thereafter conveys theproperty to the Agency with an assignment, without recourse, to the Agency ofall claims of the mortgagee against the mortgagor or others arising out of themortgage foreclosure, or deficiency judgment; or
(3) The acceptance bythe Agency of title to the property or an assignment of the mortgage, withoutrecourse to the Agency, in the event the Agency determines it imprudent toproceed under (1) or (2) above.
Upon the occurrence of either(1), (2) or (3) hereof, the obligation of the mortgagee to pay premium chargesfor insurance shall cease, and the Agency shall, within 30 days thereafter, payto the mortgagee ninety‑eight percent (98%) of the sum of (i) the thenunpaid principal balance of the insured indebtedness, (ii) the unpaid interestto the date of conveyance or assignment to the Agency, as the case may be, (iii)the amount of all payments made by the mortgagee for which it has not beenreimbursed for taxes, insurance, assessments and mortgage insurance premiums,and (iv) such other necessary fees, costs or expenses of the mortgagee as maybe approved by the Agency.
(f) Upon request ofthe mortgagee, the Agency may at any time, under such terms and conditions asit may prescribe, consent to the release of the mortgagor from his liability orconsent to the release of parts of the property from the lien of the mortgage,or approve a substitute mortgagor or sale of the property or part thereof.
(g) No claim for thebenefit of the insurance provided in this Chapter shall be accepted by theAgency except within one year after any sale or acquisition of title of the mortgagedpremises described in subdivisions (1) or (2) of subsection (e) of thissection.
(h) There shall be paidinto the housing mortgage insurance fund (i) all premiums received by theAgency for the granting of such mortgage insurance, (ii) any moneys or otherassets received by the Agency as a result of default or delinquency on mortgageloans insured by the Agency, including any proceeds from the sale or lease ofreal property, (iii) any moneys appropriated and made available by the Statefor the purpose of such fund. (1973, c. 1296, s. 45.)
