Page:United States Statutes at Large Volume 104 Part 5.djvu/832

 104 STAT. 4154 PUBLIC LAW 101-625—NOV. 28, 1990 "(3) ensuring continued affordability by tenants, homebuyers, and homeowners in the project; "(4) providing ongoing training and counseling for homebuyers and homeowners; and "(5) replacing units in eligible projects covered by a homeownership program. "(d) ACQUISITION AND REHABILITATION LIMITATIONS.—Acquisition or rehabilitation of public housing projects under a homeownership program under this title may not consist of acquisition or rehabilitation of less than the whole public housing project (not including scattered site single family housing of a public housing agency) in a project consisting of more than 1 building. The provisions of this subsection may be waived upon a finding by the Secretary that the sale of less than all the buildings in a project is feasible and will not result in a hardship to any tenants of the project who are not included in the homeownership program. "(e) FINANCING.— "(1) IN GENERAL.—The application shall identify and describe the proposed financing for (A) any rehabilitation, and (B) acquisition (i) of the project, where applicable, by an entity other than the public housing agency for transfer to eligible families, and (ii) by eligible families of ownership interests in, or shares representing, units in the project. Financing may include use of the implementation grant, sale for cash, or other sources of financing (subject to applicable requirements), including conventional mortgage loans and mortgage loans insured under title II of the National Housing Act. "(2) PROHIBITION AGAINST PLEDGES.— Property transferred under this title shall not be pledged as collateral for debt or otherwise encumbered except when the Secretary determines that— "(A) such encumbrance will not threaten the long-term availability of the property for occupancy by low-income families; "(B) neither the Federal Government nor the public housing agency will be exposed to undue risks related to action that may have to be taken pursuant to paragraph (3); "(C) any debt obligation can be serviced from project income, including operating assistance; and "(D) the proceeds of such encumbrance will be used only to meet housing standards in accordance with subsection (f) or to make such additional capital improvements as the Secretary determines to be consistent with the purposes of this title. "(3) OPPORTUNITY TO CURE.— Any lender that provides financing in connection with a homeownership program under this subtitle shall give the public housing agency, resident management corporation, individual owner, or other appropriate entity a reasonable opportunity to cure a financial default before foreclosing on the property, or taking other action as a result of the default. " (f) HOUSING QUALITY STANDARDS. —The application shall include a plan ensuring that the unit— "(1) will be free from any defects that pose a danger to health or safety before transfer of an ownership interest in, or shares representing, a unit to an eligible family; and

�