§ 7-49-110 — Mortgage loans eligible for insurance

(1) Fund insurance may be
made available under the following conditions:

(a) Fund insurance is applicable to loans originated by mortgagees approved
by the corporation.

(b) Mortgage loans must be a first lien against subject property.

(c) Mortgage loans involving leaseholds must have a remaining lease term of
not less than the mortgage term plus ten years.

(d) Mortgage loans on one- to eight-family properties are eligible only if
owner-occupied.

(e) All mortgage loans shall bear interest at the rate agreed upon by the
mortgagor and the corporation if the loan is made directly from funds held by the
corporation and transferred to a participating lender, or by the mortgagor and the
lending institution if the loan is made by the institution on call from the corporation.

(f) No mortgage loan shall be insured for a term in excess of forty years.

(g) The mortgage loan must contain amortization provisions satisfactory to
the corporation for the complete amortization of the loan in monthly installments.
Generally, the sum of principal and interest payments shall be substantially the
same from month to month; however, special amortization programs involving
increasing or decreasing monthly payments may be considered for insurance by the
corporation.

(h) Mortgage loans submitted for insurance consideration to the corporation
must conform to the exhibits, documentation, and eligibility criteria as required
under the loan insurance program for which approval is being requested. The
corporation may establish, from time to time, the maximum interest rate and term
of the loan which it will permit as to any loan it will insure.

Legislative History

Source: L. 75: Entire article added, p. 268, � 1, effective June 29.