(a) Except as provided in paragraph (b) of this section, the mortgagor:
(1) Shall be a single asset mortgagor entity acceptable to the Commissioner, as limited by the applicable section of the Act, and shall possess the powers necessary and incidental to operating the project, except that the Commissioner may approve a non-single asset mortgagor entity under such circumstances, terms and conditions determined and specified as acceptable to the Commissioner; and
(2) Shall not be a natural person or tenant in common.
(b)(1) For multifamily project mortgages for which HUD issued a firm commitment for mortgage insurance before September 1, 2011, and for multifamily project mortgages insured under section 232 of the Act (12 U.S.C. 1715w), the mortgagor shall be a natural person or entity acceptable to the Commissioner, as limited by the applicable section of the Act, and shall possess the powers necessary and incidental to operating the project.
(2) For multifamily project mortgages for which HUD issued a firm commitment for mortgage insurance on or after September 1, 2011, the regulations of paragraph (a) of this section shall apply, unless the mortgagor demonstrates to the satisfaction of the Commissioner that financial hardship to the mortgagor would result from application of the regulations in paragraph (a) of this section due to the reasonable expectations of the mortgagor that the transaction would close under the regulations in effect prior to September 1, 2011, in which case, the regulations of paragraph (b)(1) shall apply.
[76 FR 24369, May 2, 2011]
Notes of Decisions
Kilmer v. Citicorp Mortg., Inc., 860 P.2d 1165 (Wyo. 1993).
“See also Regulations Relating to Housing and Urban Development, 24 C.F.R. § 200.5 (1992). Mortgage insurance protects a mortgagee when it loans money to what would normally be considered a higher risk mortgagor.”
Fenner v. Bruce Manor, Inc., 409 F. Supp. 1332 (D. Maryland 1976).
“24 C.F.R. § 200.5 . Insofar as a § 221(d)(3) project is concerned, FHA provides insurance on mortgage loans which cover up to 90% of a project’s cost, thereby encouraging private investment in what might otherwise be considered a risky venture.”
Hous. Study Grp. v. Kemp, 732 F. Supp. 180 (D.D.C. 1990).
“The first is the section 221(d) program, which "is designed to assist private industry in providing housing for low and moderate income families and displaced families” through the construction and substantial rehabilitation of multifamily rental housing complexes and retirement…”
DeRoo v. United States, 12 Cl. Ct. 356 (Ct. Cl. 1987).
“24 C.F.R. § 200.5 (1982), Scope and nature of programs, states: The Federal Housing Administration does not make loans or build housing but operates insurance programs under the provisions of the National Housing Act.”
Berks Prods. Corp. v. Landreau, 523 F. Supp. 304 (E.D. Pa. 1981).
“24 C.F.R. § 200.5 . Regulations under the relevant sections of the National Housing Act refer only to rights and obligations to the mortgagee and not to builders or subcontractors.”
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