Page:United States Statutes at Large Volume 48 Part 1.djvu/1275

 be payable annually in advance by the mortgagee. If the Adminis- trator finds upon the presentation of a mortgage for insurance and the tender of the initial premium charge that the mortgage complies with the provisions of this section, such mortgage may be accepted for insurance by endorsement or otherwise as the Administrator may prescribe ; but no mortgage shall be accepted for insurance under this section unless the Administrator finds that the project with respect to which the mortgage is executed is economically sound. (d) The Administrator is authorized and directed to make such rules and regulations as may be necessary to carry out the provisions of this section. PAYMENT OF INSURANCE 86637 °- 31 -79 73d CONGRESS. SESS. II. CH. 847. JUNE 27, 1934 . 1249 Acceptance of mort- gage. Finding of economic soundness of project, required. Rule s and regul a- tions. P aym ent of insur- ance. SEC. 204 . (a) In any case in which the mortgagee under an insured To m ortgagee up on mortgage shall have foreclo sed and taken possession of the mort- foreclosure of insured mortgage. gaged property in accordance with regulations of, and within a period to be determined by, the Administrator, or shall, with the consent of the Administrator, have otherwise acquired such property from the mortgagor after default, the mortgagee shall be entitled, R equir emen ts. upon the promp t conveyance to the Admini strator of tit le to such property satisfactory to him and the assignment to him of all claims of the mortgagee against the mortgagor arising out of the mortgage transaction or foreclosure proceedings, to receive the benefits of the Pa yment of an nual insurance as hereinafter provided. Up on su ch con ve yan ce and cease, charges to assignment the obliation of the mortgagee to pay the annual premium charges for m insurance shall cease a nd the Admini strator shall issue to the mortgagee debentures having a total face value t Issue of debentures equal to the value of the mortgage on the date of the delivery of the property to the Administrator, and a certificate of claim, as Certifieate of claim. hereinafter provided. For the purposes of this subsection, the value of the mortgage shall be determined b adding to the amount of the De terminatio n of prin cipa l f te mortgage which is unpaid on the date of such value of mortgage. delivery the amount of all payments which have been made by the mortgagee for taxes and insurance on the property mortgaged in accordance wit h rules and r egulations pr escribed by th e Adminis- trator. (b) The debent ures issued b y the Adminis trator under t his sec- h en~teerst rate on de. tion to any mortgagee shall bear interest at a rate determined by the Administrator at the time the mortgage was offered for insur- ance, but not to exceed 3 per centum per annum, payable semi- annually on the 1st day of January and the 1st day of July of each year, and shall mature three years after the 1st day of July Maturity date. following the maturity date of the mortgage in exchange for which the debentures were issued. All such debentures shall be subject Taxation of. only to such F ederal, State, and local t axes as the mo rtgages in exchange for which they are issued would be subject to in the hands Fud be liabi lity of of the holder of the debentures and shall be a liability of the Fund Exception, mortgages only ; except that debentures issued in exchange for mortgages in- fully guaranteed. sured under this section prior to July 1, 1937, shall be fully guaran- teed as to principal and interest by the United States. In the bentu yes nwhen nFund event that the amount in the Fund is insufficient to pay upon de- insufficient. mand, when due, the principal of or interest on any debentures so guaranteed, the Secretary of the Treasury shall pay to the holders the amount thereof which is hereby authorized to be appropriated out of any m oney in the T reasury not o therwise appro priated, and thereupon to the extent of the amount so paid the Secretary of the Treasury shall succeed to all the rights of the holders of such debentures.