Page:United States Statutes at Large Volume 101 Part 2.djvu/337

 PUBLIC LAW 100-198—DEC. 21, 1987

101 STAT. 1323

"(b) If a person disposes of residential property described in subsection (a)(l) of this section and the person fails to notify the holder of the loan before the property is disposed of, the holder, upon learning of such action by the person, may demand immediate and full payment of the principal, interest, and all other amounts owing under the terms of the loan. "(c)(1) In any case in which the holder of a loan described in subsection (a)(l) of this section has knowledge of a person's disposing of residential property securing the loan, the holder shall notify the Administrator of such action. "(2) If the holder fails to notify the Administrator in such a case, the holder shall be liable to the Administrator for any damage sustained by the Administrator as a result of the holder's failure, as determined at the time the Administrator is required to make payments in accordance with any insurance or guaranty provided by the Administrator with respect to the loan concerned. "(d) The Administrator shall provide that the mortgage or deed of trust and any other instrument evidencing the loan entered into by a person with respect to a loan guaranteed, insured, or made under this chapter shall contain provisions, in such form as the Administrator shall specify, implementing the requirements of this section, and shall bear in conspicuous position in capital letters on the first page of the document in type at least 2 and Vz times larger than the regular type on such page the following: 'This loan is not assumable without the approval of the Veterans' Administration or its authorized agent.'. "(e) The Administrator shall establish in regulations a reasonable Regulations. amount as the maximum amount that a lender may charge for processing an application for a creditworthiness determination and assumption of a loan pursuant to this section. Such regulations shall establish requirements for the timely processing of applications for acceptance of assumptions. "(f) This section shall apply only to loans for which commitments are made on or after March 1, 1988.". (2) Section 1817 is amended by adding at the end the following new subsection: "(c) This section shall apply only to loans for which commitments are made before March 1, 1988,". (3) The table of sections for chapter 37 is amended by inserting after the item for section 1817 the following new item: "1817A. Assumptions; release from liability.". (b) PROTECTION AGAINST TRANSFERS TO PERSONS NOT CREDIT-

WORTHY.—Section 1804 is amended by adding at the end the following new subsection: "(f) Any housing loan which is financed through the assistance of this chapter and to which section 1817A of this chapter applies shall include a provision that the loan is immediately due and payable upon transfer of the property securing such loan to any transferee unless the acceptability of the assumption of the loan is established pursuant to such section 1817A.". (c) LOAN FEE.—Section 1829 is amended by adding at the end the following new subsection: "(d) Except as provided in subsection (b) of this section, a fee shall be collected from a person assuming a loan to which section 1817A of this chapter applies. The amount of the fee shall be equal to one-

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