Annual MIP shall be paid on the anniversary date of the beginning of amortization. It shall be paid in an amount equal to one-half percent of the average outstanding principal obligation for the 12-month period following the date on which the premium becomes payable.

§ 603.270 Pro rata adjustment of MIP upon prepayment.

Upon prepayment of the mortgage in full prior to maturity, the Commissioner shall refund to the mortgagee for the account of the mortgagor an amount equal to the pro rata portion of the current MIP theretofore paid which is applicable to the portion of the year subsequent to such payment, computed from the first day of the month following the month in which such prepayment occurs. No such refund shall be made in any case where the prepayment occurs in the twelfth month of the premium year.

§ 603.275 Payment of delinquent inter

est.

The mortgagee may, with the written consent of the Commissioner, apply partial payments to delinquent interest to the exclusion of prior delinquent principal payments at a rate not in excess of the interest rate applicable to debentures to which the mortgagee may be entitled. Where the partial payments are so applied, the date of default shall be 30 days after the due date of the earliest monthly payment any part of which remains unpaid.

§ 603.280 Special forbearance reliefownership of ten unit project.

The Commissioner may consent to the mortgagee entering into a written agreement with the mortgagor providing for a postponement for a period not to exceed 1 year of that part of the monthly payment which represents amortization of principal where the mortgagor is the owner of a group of properties consisting of a project of not less than 10 rental units. Such agreement shall obligate the mortgagor to deposit with the mortgagee the entire net income

from all of the properties comprising the project, under arrangements satisfactory to the Commissioner. The agreement shall also obligate the mortgagor to resume monthly payments after the effective period of the agreement in such amounts as will completely amortize the mortgage indebtedness within the original maturity. The agreement shall in no way affect the amount of the annual MIP which shall continue to be calculated in accordance with the original amortization provisions.

§ 603.285 Insurance benefits conveyed properties-foreclosure costs.

All of the provisions of § 203.402 of this chapter shall govern the computation of the items included in insurance benefits for conveyed properties, except that in lieu of the allowance in paragraph (f) of § 203.402 of this chapter for foreclosure costs or for the costs of acquiring the property otherwise, there shall be included on account of such costs, in those cases involving mortgages on which the unpaid principal obligation at the time of the institution of foreclosure exceeds 80 percent of the appraised value of the property as of the date the mortgage was accepted for insurance, an amount not in excess of the greater of the following:

(a) Two percent of the unpaid principal of the mortgage as of the date of the institution of foreclosure proceedings, but not in excess of $75; or

(b) Two-thirds of the foreclosure costs or the costs of acquiring the property otherwise.

§ 603.290 Debenture interest rate.

Debentures shall bear interest at the rate of 22 percent per annum in the case of mortgages endorsed for insurance prior to July 8, 1953, and at the rate of 24 percent per annum in the case of mortgages endorsed for insurance on or after July 8, 1953, and at the rate of 21⁄2 percent per annum if issued in exchange for property accepted for insurance pursuant to commitments issued by the Commissioner on or after May 29, 1954, payable semiannually on the first day of January and the first day of July of each year.

187-190

§ 603.295 Maturity of debentures.

Debentures shall mature as follows:

(a) Where the mortgage was insured pursuant to a commitment issued on or before May 25, 1942, the debentures shall mature 3 years after the first day of July following the maturity date of the mortgage.

(b) Where the mortgage was insured pursuant to a commitment issued subsequent to May 25, 1942, the debentures shall mature 10 years after the date of issue.

§ 603.300 Applicability to outstanding

mortgages and commitments.

The regulations in this part are effective as to all mortgages on which a commitment to insure under section 603 of the act is issued to an approved mortgagee on or after July 15, 1946. Whenever a mortgagee so desires, the provisions of this part shall become a part of any contract of insurance heretofore made. The regulations in this part are also effective as to all mortgages on which a commitment to insure under section 603 of the act pursuant to the provisions of section 610 of such act is issued to an approved mortgagee on or after August 19, 1947.

PART 611-SINGLE FAMILY PROJECT LOANS; WAR HOUSING MORTGAGE INSURANCE

Subpart A-Eligibility Requirements [Reserved]

Sec.

SUBPART B-CONTRACT RIGHTS AND OBLIGATIONS

611.251 Incorporation by reference. 611.255 Due date of initial MIP. 611.260 Adjustment of initial MIP. 611.265

Amount of annual MIP.

611.270 Pro rata adjustment of MIP upon prepayment.

611.275 Insurance benefits conveyed properties foreclosure costs. 611.280 Debenture interest rate. 611.285 Maturity of debentures. 611.290 Applicability to outstanding mortgages and commitments.

AUTHORITY: The provisions of this Part 611 issued under sec. 607, 55 Stat. 61, as amended; sec. 611, 62 Stat. 1271, amended; U.S.C. 1742, 1746. Incorporation by reference.

as

§ 611.251

12

§ 611.260 Adjustment of initial MIP.

Regardless of whether the period covered by the MIP is more or less than 1 year, a payment shall be made to the Commissioner on account of the initial MIP which payment shall be in an amount equal to one-half percent of the average outstanding principal obligation for the first year of amortization under the mortgage. If such payment is less than the minimum premium or more than the maximum premium prescribed by the act, the initial MIP shall be in such minimum amount and the amount of the second premium shall be adjusted accordingly. If such payment is within the limitations prescribed by the act, no adjustment shall be made and the amount of the payment shall be retained by the Commissioner as the initial MIP.

§ 611.265 Amount of annual MIP. After payment of the initial MIP and until the mortgage is paid in full or until an application for insurance benefits is received by the Commissioner or until the contract is otherwise terminated with the consent of the Commissioner, the mortgagee shall continue to pay annual MIP to the Commissioner. Annual MIP shall be paid on the anniversary date of the beginning of amortization. It shall be paid in an amount equal to one-half percent of the average outstanding principal obligation for the 12-month period following the date on which the premium becomes payable.

§ 611.270 Pro rata adjustment of MIP upon prepayment.

Upon prepayment of the mortgage in full prior to maturity, the Commissioner shall refund to the mortgagee for the account of the mortgagor an amount equal to the pro rata portion of the current MIP therefor paid which is applicable to the portion of the year subsequent to such payment, computed from the first day of the month following the month in which such prepayment occurs. No such refund shall be made in any case where the prepayment occurs in the twelfth month of the premium year. § 611.275 Insurance benefits conveyed properties-foreclosure costs.

All the provisions of § 203.402 of this chapter shall govern the computation of the items included in insurance benefits for conveyed properties, except that in lieu of the allowance in paragraph (f) of 203.402 of this chapter for foreclosure costs or for the costs of acquiring the property otherwise, there shall be included on account of such costs, in those cases involving mortgages on which the unpaid principal obligation at the time of the institution of foreclosure exceeds 80 percent of the appraised value of the property as of the date the mortgage was accepted for insurance, an amount not in excess of the greater of the following:

(a) Two percent of the unpaid principal of the mortgage as of the date of the institution of foreclosure proceedings, but not in excess of $75; or

(b) Two-thirds of the foreclosure costs or the costs of acquiring the property otherwise.

§611.280 Debenture interest rate.

Debentures shall bear interest at the rate of 22 percent per annum in the case of mortgages endorsed for insurance prior to July 8, 1953, and at the rate of 234 percent per annum in the case of mortgages endorsed for insurance on or after July 8, 1953, and at the rate of 21⁄2 percent per annum if issued in exchange for property accepted for insurance pursuant to commitments issued by the Commissioner on or after May 29, 1954, payable semiannually on the first day of January and the first day of July of each year.

§ 611.285 Maturity of debentures.

Debentures shall mature 10 years from the date of issue.

§ 611.290 Applicability to outstanding mortgages and commitments.

The regulations in this part shall be effective as to all mortgages with respect to which a commitment to insure under section 611 of the act is issued on or after the date of this part.