will provide an investment yield of not less than the yield obtainable from other investments authorized by this subsection. Debentures so purchased shall be canceled and not reissued.

SEC. 214. If the Secretary of Housing and Urban Development finds that, because of higher costs prevailing in 2 Alaska, Guam, or Hawaii, it is not feasible to construct dwellings or 3 mobile home courts or parks on property located in Alaska or in Guam or Hawaii without sacrifice of sound standards of construction, design or livability, within the limitations as to maximum or maxima mortgage amounts provided in this Act, the Secretary may, by regulations or otherwise, prescribe, with respect to dollar amount, a higher maximum or maxima for the principal obligation of mortgages insured under this Act covering property located in Alaska or in Guam or Hawaii in such amounts as he shall find necessary to compensate for such higher costs but not to exceed, in any event, the maximum or maxima otherwise applicable (including increased mortgage amounts in geographical areas where cost levels so require) by more than one-half thereof. No mortgage with respect to a project or property in Alaska or in Guam or Hawaii shall be accepted for insurance under this Act unless the Secretary finds that the project or property is an acceptable risk, giving consideration to the acute housing shortage in Alaska or in Guam or Hawaii: Provided, That any such mortgage may be insured or accepted for insurance without regard to any requirement in any other section of this Act that the Secretary finds the project or property to be economically sound or an acceptable risk. Notwithstanding any of the provisions of this Act or any other law, the Alaska Housing Authority or the Government of Guam or Hawaii or any agency or instrumentality thereof shall be eligible as mortgagor or mortgagee, as the case may be, for any of the purposes of mortgage insurance under the provisions of this Act. Upon application by the mortgage (1) where the mortgagor is regulated or restricted pursuant to the last sentence of this section or (2) where the Alaska Housing Authority or the Government of Guam or Hawaii or any agency or instrumentality thereof is the mortgagor or mortgagee, for the insurance of a mortgage under any provisions of this Act, the Secretary is authorized to insure the mortgage (including advances thereon where otherwise authorized), and to make commitments for the insuring of any such mortgages prior to the date of their execution or disbursement thereon, under such provisions (and this section) without regard to any requirement that the mortgagor shall be the owner and occupant of the property or shall have paid a prescribed amount on account of such property. Without limiting the authority of the Secretary under any other provision of law, the Secretary is hereby authorized, with respect to any mortgagor in such case (except where

Added by the Alaska Housing Act. Public Law 52, 81st Congress, approved April 23. 1949, 63 Stat. 57. Made applicable to Guam by sec. 10(a) (3), Housing Act of 1952, Public Law 531, 82d Congress, approved July 14, 1952, 66 Stat. 603, and to Hawaii by sec. 25(a), Housing Amendments of 1953, Public Law 94, 83d Congress, approved June 30, 1953, 67

Stat. 128.

Sec. 10(e), Alaska Omnibus Act, Public Law 86-70, approved June 25, 1959, 73 Stat. 141, 142, substituted "Alaska, Guam" for "the Territory of Alaska or in Guam".

Sec. 418(a), Housing and Urban Development Act of 1969. Public Law 91-152, approved December 24, 1969, 83 Stat. 379, 402, inserted "or mobile home courts or parks". Sec. 106, Housing Act of 1959. Public Law 86-372, approved September 23, 1959, 73 Stat. 654, 657, inserted this parenthetical phrase.

Sec. 606. Defense Housing and Community Facilities and Service Act of 1951, Public Law 139, 82d Congress, approved September 1, 1951, 65 Stat. 293, substituted "one-half" for "one-third".

Clause numbered (1) inserted by sec. 25(c) (1). Housing Amendments of 1953, Public Law 91, 83d Congress, approved June 30, 1953, 67 Stat. 128.

the Alaska Housing Authority is the mortgagor or mortgagee) to require the mortgagor to be regulated or restricted as to rents or sales, charges, capital structure, rate of return, and methods of operation to such an extent and in such manner as the Secretary determines advisable to provide reasonable rentals and sales prices and a reasonable return on the investment.1

ISSUANCE OF COMMITMENTS

SEC. 215. The Secretary is hereby authorized to process applications and issue commitments with respect to insurance of mortgages under section 8 of title I, title II, title VI, title VIII, or title IX of this Act, even though the permanent mortgage financing may not be insured under this Act, and in the event the mortgage is not so insured the Secretary is authorized to charge an additional application fee determined by him to be reasonable. The Secretary is authorized to make such rules and regulations as may be necessary to carry out the provisions of this section.

WAIVER OF OCCUPANCY REQUIREMENTS FOR SERVICEMEN

SEC. 216.2 The Secretary is hereby authorized to insure any mortgage otherwise eligible for insurance under any of the provisions of this Act without regard to any requirement that the mortgagor be the occupant of the property at the time of insurance, where the Secretary is satisfied that the inability of the mortgagor to occupy the property is by reason of his entry on active duty in a uniformed service subsequent to the filing of an application for insurance and the mortgagor expresses an intent to occupy the property upon his release from active duty.

GENERAL MORTGAGE INSURANCE AUTHORIZATION

SEC. 217.3 Except with respect to the insurance of a loan or mortgage pursuant to section 2, section 221, section 235, section 236, title VIII, title X, or title XI of this Act (subject to any limitations thereunder on the time of such insurance), no loan or mortgage shall be insured under any provision of this Act after September 30, 1979.3 except pursuant to a commitment to insure before that date.

1 This sentence was added by sec. 25(c) (2), Housing Amendments of 1953, Public Law 94, 83d Congress, approved June 30, 1953, 67 Stat. 129.

2 Added by sec. 607, Defense Housing and Community Facilities and Services Act of 1951, Public Law 139, 82d Congress, approved September 1, 1951, 65 Stat. 293, and amended by sec. 7(a) of Public Law 91-621, approved December 31, 1970, 84 Stat. 1863, 1865, to extend to the Commissioned officers of the National Oceanic and Atmospheric Administration the waiver of occupancy requirements accorded to military personnel.

3 Sec. 101 (b), Housing and Urban Development Act of 1969. Public Law 91-152, approved December 24, 1969, 83 Stat. 379, amended this section to include the references to sections 235, 236, title XI, and also to establish the termination date of October 1, 1970. This termination date was subsequently extended as follows: (1) To November 1, 1970, by sec. 1(b) of Public Law 91-432, approved October 2, 1970, 84 Stat. 886; (2) to December 1, 1970. by sec. 1(b) of Public Law 91-473, approved October 21, 1970, 84 Stat. 1064; (3) to January 1, 1971, by sec. 1(b) of Public Law 91-525, approved December 1, 1970, 84 Stat. 1384; (4) to October 1, 1972, by sec. 101 (b), Housing and Urban Development Act of 1970, Public Law 91-609. approved December 31, 1970, 84 Stat. 1770; (5) to June 30, 1973, by sec. 1(b) of Public Law 92-503, approved October 18, 1972, 86 Stat. 906; (6) to October 1, 1973, by sec. 1(b) of Public Law 93-85, approved August 10, 1973, 87 Stat. 220: (7) to October 1, 1974, by sec. 1(b) of Public Law 93-117, approved October 2, 1973, 87 Stat. 421 and (8) Sec. 316(h) of Housing and Community Development Act of 1974. 88 Stat. 633, approved August 22, 1974, substituted "June 30. 1977" for "October 1, 1974"; Sec. 202(b), Housing and Urban Development Act of 1965. Public Law 89-117, approved August 10, 1965, 79 Stat. 451, 465, had amended this section to include title X; amended by Housing and Community Development Act of 1977. Public Law 95-128. approved October 12, 1977, Public Law 95-60, approved June 30, 1977, had previously extended the date from June 30, 1977 to July 31, 1977: Public Law 95-80, approved Apr. 30, 1977, had further extended the date from July 31, 1977 to September 30, 1977. Section 301 (b) of the Housing and Community Development Amendments of 1978, Public Law 95-557, 92 Stat. 2080, approved October 31, 1978, further extended this date.

REHABILITATION AND NEIGHBORHOOD CONSERVATION HOUSING INSURANCE

SEC. 220. (a) The purpose of this section is to aid in the elimination of slums and blighted conditions and the prevention of the deterioration of residential property by supplementing the insurance of mortgages under sections 203 and 207 of this title with a system of loan and mortgage insurance designed to assist the financing required for the rehabilitation of existing dwelling accommodations and the construction of new dwelling accommodations where such dwelling accommodations are located in an area referred to in paragraph (1) of subsection (d) of this section.

(b) The Secretary is authorized, upon application by the mortgagee, to insure, as hereinafter provided, any mortgage (including advances during construction on mortgages covering property of the character described in paragraph (3)(B) of subsection (d) of this section) which is eligible for insurance as hereinafter provided, and, upon such terms and conditions as he may prescribe, to make commitments for the insurance of such mortgages prior to the date of their execution or disbursement thereon.

(c) As used in this section, the terms "mortgage," "first mortgage," "mortgagee," "mortgagor," "maturity date," and "State" shall have the same meaning as in section 201 of this Act.

(d) To be eligible for insurance under this section a mortgage shall meet the following conditions:

(1) The mortgaged property shall

(A) be located in (i) the area of a slum clearance and urban redevelopment project covered by a Federal-aid contract executed or a prior approval granted, pursuant to title I of the Housing Act of 1949 before the effective date of the Housing Act of 1954, or (ii) an urban renewal area (as defined in title I of the Housing Act of 1949, as amended) or (iii) the area of an urban renewal project assisted under section 111 of the Housing Act of 1949, as amended, or (iv) an area in which a program of concentrated code enforcement activities is being carried out pursuant to section 117 of the Housing Act of 1949: Provided, That, in the case of an area within the purview of clause (i) or (ii) of this subparagraph, a redevelopment plan or an urban renewal plan (as defined in title I of the Housing Act of 1949, as amended), as the case may be, has been approved for such area by the governing body of the locality involved and by the Secretary of Housing and Urban Development and the Secretary has determined that such plan conforms

Repealed by sec. 108, Housing Act of 1959, Public Law 86-372, approved September 23, 1959, 73 Stat. 654, 657.

Repealed by sec. 1108 (aa). Housing and Urban Development Act of 1965, Public Law 89-117, approved August 10, 1965, 79 Stat. 451, 507.

Added by sec. 123, Housing Act of 1954, Public Law 560, 83d Congress, approved August 2, 1954, 68 Stat. 590, 596.

Sec. 102(a)(2), Housing Act of 1961, Public Law 87-70, approved June 30, 1961, 75 Stat. 149, 154, inserted "loan and".

Ameaded to include areas of urban renewal projects in disaster areas by sec. 307(b), Housing Act of 1956, Public Law 1020, 84th Congress, approved August 7, 1956, 70 Stat. 1091, 1102, and further amended by sec. 311(c), Housing and Urban Development Act of 1905. Public Law 89-117, approved August 10, 1965, 79 Stat. 451, 478. to include code enforcement areas, the Supplemental Housing Authorization Act of 1977, Public Law 95-24, approved April 30, 1977, amended this Section as set forth in the text.

to a general plan for the locality as a whole and that there exist the necessary authority and financial capacity to assure the completion of such redevelopment or urban renewal plan: And provided further, That, in the case of an area within the purview of clause (iii) of this subparagraph, an urban renewal plan (as required for projects assisted under such section 111) has been approved for such area by such governing body and by the Secretary, and the Secretary has determined that such plan conforms to definite local objectives respecting appropriate land uses, proved traffic, public transportation, public utilities, recreational and community facilities, and other public improvements, and that there exist the necessary authority and financial capacity to assure the completion of such urban renewal plan, and

im

(B) meet such standards and conditions as the Secretary shall prescribe to establish the acceptability of such property for mortgage insurance under this section.

(2) The mortgaged property shall be held by

(A) a mortgagor approved by the Secretary, and 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 operation, and for such purpose the Secretary may make such contracts with and acquire for not to exceed $100 stock or interest in any such mortgagor as the Secretary may deem necessary to render effective such restriction 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; or

(B) by Federal or State instrumentalities, municipal corporate instrumentalities of one or more States, or limited dividend or redevelopment or housing corporations or other legal entities restricted by or under Federal or State laws or regulations of State banking or insurance departments as to rents, charges, capital structure, rate of return, or methods of operation. (3) The mortgage shall

(A) (i) involve a principal obligation (including such initial service charges, appraisal, inspection, and other fees as the Secretary shall approve) in an amount not to exceed $60,0001 in the case of property upon which there is located a dwelling designed principally for a one-family residence; or $65,0001 in the case of a two-family residence; or $65,000 in the case of a three-family residence; or $75,000 in the case of a four-family residence; or in the case of a dwelling designed principally for residential use for more than four families (but not exceeding such additional number of family units as the Secretary may prescribe) $75,000 1 plus not to exceed $7,7001 for each additional

1 Sec. 113(d) (1), Housing and Urban Development Act of 1969, Public Law 91-152. approved December 24, 1969. 83 Stat. 379, 384, increased the dollar limits on one-family homes from "$30,000" to "$33,000", on two- and three-family homes from "$32.500" to "$35,750", and on four-family homes from "$37,500" to "$41,250", and also increased from "$7,000" to "$7,700", the limit for each additional family unit in excess of four located on such property. Sec. 302 (b) of Housing and Community Development Act of 1974, Public Law 93-383, approved August 22, 1974, 88 Stat. 633, substituted "$45,000" for $33.000", "$48.750" for "$35,750", and "$56.000" for "$41.250". each place it appears, Housing and Community Development Act of 1977. Public Law 95-128, approved October 12, 1977, substituted "$60,000" for "$45,000", "$65,000" for "$48,750" and "$75,000" for "$56,000".

2

family unit in excess of four located on such property; and not to exceed an amount equal to the sum of (1) 97 per centum (but, in any case where the dwelling is not approved for mortgage insurance prior to the beginning of construction, unless the construction of the dwelling was completed more than one year prior to the application for mortgage insurance, 90 per centum) of $25,000 of the Secretary's estimate of replacement cost of the property, as of the date the mortgage is accepted for insurance, and (2) 95 per centum of such value in excess of $25,000 2: Provided, That in the case of properties other than new construction, the foregoing limitations upon the amount of the mortgage shall be based upon the sum of the estimated cost of repair and rehabilitation and the Secretary's estimate of the value of the property before repair and rehabilitation rather than upon the Secretary's estimate of the replacement cost: Provided further,* That if the mortgagor is a veteran and the mortgage to be insured under this section covers property upon which there is located a dwelling designed principally for a one-family residence, the principal obligation may be in an amount equal to the sum of (1) 100 per centum of $25,000 of the Secretary's estimate of replacement cost of the property, as of the date the mortage is accepted for insurance and (2) 95 per centum of such value in excess of $25,000 As used herein, the term "veteran" means any person who served on active duty in the Armed Forces of the United States for a period of not less than ninety day (or as certified by the Secretary of Defense as having performed extrahazardous service), and who was discharged or released therefrom under conditions other than dishonorable;

5

(ii) in a case where the mortgagor is not the occupant of the property and intends to hold the property for rental purposes, have a principal obligation in an amount not to exceed 93 per centum of the amount computed under the provisions of clause (i);

1 Sec. 109(a)(2), Housing Act of 1959, Public Law 86-372, approved September 23, 1959, 73 Stat. 654, 657, substituted "90 per centum" for "85 per centum".

Sec. 609 (a) (1), (2), and (3), Housing Act of 1961. Public Law 87-70, approved Jane 30, 1961, 75 Stat. 149, 179, 180, substituted "$15,000" for "$13.500” and 75 per centum" for "70 per centum.' Sec. 305(a), Demonstration Cities and Metropolitan Development Act of 1966, Public Law 89-754, approved November 3, 1966, 80 Stat. 1255, 1267, substituted "80 per centum" for "75 per centum".

Sec. 310(b)(1) of Housing and Community Development Act of 1974, Public Law 93-383, approved August 22, 1974, 88 Stat. 633, substituted "$25,000" for "$15,000" in each clause numbered (1).

Sec. 310(b) (1) of Housing and Community Development Act of 1974, Public Law 92-383, approved August 22, 1974, 88 Stat. 633, substituted "$25,000" and "$35,000" for $15,000" and "$25,000" in clauses numbered 2.

Sec. 310(b)(3) of Housing and Community Development Act of 1974, Public Law 93-383, approved August 22, 1974. 88 Stat. 633. substituted "$35.000" for "$25.000" in each clause numbered 3. Housing and Community Development Act of 1977, Public Law 95-128, approved October 12, 1977, further amended this section as set forth in the text. Immediately prior to amendment by sec. 102(a) (1), Housing Act of 1961, Public Law 87-70, approved June 30, 1961, 75 Stat. 149, 154, the limitations under this proviso were based upon "appraised value".

See. 305 (b), Demonstration Cities and Metropolitan Development Act of 1966, Public Law 89-754, approved November 3, 1966. 80 Stat. 1255, 1267, added this proviso.

Sec. 102(b), Housing and Urban Development Act of 1969, Public Law 91-152, approved December 24, 1969, 83 Stat. 379. 380, substituted "$25,000" for "$20,000". Sec. 310(b)(1) of Housing and Community Development Act of 1974, Public Law 93-383, 88 Stat. 633, approved August 22, 1974, substituted "$25,000" for "$15.000" in each clause ambered 1. Housing and Community Development Act of 1977 Public Law 95-128, approved October 12, 1977, further amended this section as set forth in the text.

Sec. 209, Housing and Urban Development Act of 1965, Public Law 89-117, approved August 10, 1965, 79 Stat. 451, 469, amended these provisions to increase the maximum amount of a mortgage that can be insured in a case where the mortgagor is not the occupant of the property but intends to hold it for rental purposes.