Page:United States Statutes at Large Volume 104 Part 5.djvu/953

 PUBLIC LAW 101-625—NOV. 28, 1990 104 STAT. 4275 "Subtitle A—Short Title "Sec. 201. Short title. "Subtitle B—Prepasmient of Mortgages Insured Under National Housing Act "Sec. 211. General prepayment limitation. "Sec. 212. Notice of intent. "Sec. 213. Appraisal and preservation value of eligible low-income housing. "Sec. 214. Annual authorized return and preservation rents. "Sec. 215. Federal cost limits and limitations on plans of action. "Sec. 216. Information from Secretary. "Sec. 217. Plan of action. "Sec. 218. Prepayment and voluntary termination. "Sec. 219. Incentives to extend low-income use. "Sec. 220. Incentives for transfer to qualiHed purchasers. "Sec. 221. Mandatory sale for housing exceeding Federal cost limits. "Sec. 222. Criteria for approval of plan of action involving incentives. "Sec. 223. Assistance for displaced tenants. "Sec. 224. Permissible prepayment or voluntary termination and modification of commitments. "Sec. 225. Timetable for approval of plan of action. "Sec. 226. Resident homeownership program. "Sec. 227. Delegated responsibility to State agencies. "Sec. 228. Consultations with other interested parties. "Sec. 229. Definitions. "Sec. 230. Notice to tenants. "Sec. 231. Definitions of qualified and priority purchasers and related party rule. "Sec. 232. Preemption of State and local laws. "Sec. 233. Severability. "Sec. 234. Authorization of appropriations. "Sec. 235. Applicability.". SEC. 602. RELATED NATIONAL HOUSING ACT AMENDMENTS. (a) INSURANCE FOR SECOND MORTGAGE FINANCING.— Section 241(f) of the National Housing Act is amended to read as follows: 12 USC 17l5z-6. "(fKl) Notwithstanding any other provision of this section, the Secretary may, upon such terms and conditions as the Secretary may prescribe, make a commitment to insure and insure equity loans and acquisition loans made by financial institutions approved by the Secretary and State housing finance agencies that enter into risk-sharing agreements with the Secretary. "(2)(A) For purposes of this section, the term 'equity loan' means a loan or advance of credit to the owner of eligible low income housing (EIS defined in section 229 of the Low-Income Housing Preservation and Resident Homeownership Act of 1990) who agrees to extend the low-income affordability restrictions on the housing pursuant to an approved plan of action under such Act. (B) To be eligible for insurance under this paragraph, an equity loan shall— "(i) be limited to an amount equal to the lesser of (I) 70 percent of the preservation equity in the project, as determined by the Secretary under such Act, or (II) the amount the Secretary determines can be supported by the project on the basis of an 8 percent return on the preservation equity (assuming normal debt service coverages); and "(ii) provide for the lender to deposit (on behalf of the borrowing owner) 10 percent of the loan amount in an escrow account, controlled by the Secretary or a State housing finance agency approved by the Secretary, which shall be made available to the owner upon the expiration of the 5-year period beginning on the date the loan is made, subject to compliance with section 222(d) of such Act; and

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