Page:United States Statutes at Large Volume 72 Part 1.djvu/1247

 72 S T A T. ]

PUBLIC LAW 8 5 - 8 5 7 - S E P T. 2, 1958

§ 1803. Basic provisions relating to loan guaranty (a)(1) Any loan made to a World War II veteran, if made before July 26, 1960 (or, in the case of a veteran describ*^d in section 1801(a) (1)(B) of this title, before the expiration of thirteen years after World W a r II is deemed to have ended with respect to him), or to a Korean conflict veteran, if.made before February 1, 1965, for any of the purposes, and in compliance with the provisions, specified in this chapter, is automatically guaranteed by the United States in an amount not more than 60 per centum of the loan if the loan is made for any of the purposes specified in section 1810 of this title and not more than 50 per centum of the loan if the loan is for any of the purposes specified in section 1812, 1813, or 1814 of this title. (2) If a loan report or an application for loan guaranty relating to a loan under this chapter to a World W a r II veteran whose entitlement would otherwise expire on July 25, 1960, has been received by the Administrator before July 26, 1960, such loan may be guaranteed or insured under the provisions of this chapter before July 26, 1961. (b) Except as provided in sections 1810 and 1811 of this title, the aggregate amount guaranteed shall not be more than $2,000 in the case of non-real-estate loans, nor $4,000 in the case of real-estate loans, or a prorated portion thereof on loans of both types or combination thereof. The liability of the United States under any guaranty, within the limitations of this chapter, shall decrease or increase pro rata with any decrease or increase of the amount of the unpaid portion of the obligation. (c)(1) Loans guaranteed or insured under this chapter shall be payable upon such terms and conditions as may be agreed upon by the parties thereto, subject to the provisions of this chapter and regulations of the Administrator issued pursuant to this chapter, and shall bear interest not in excess of such rate as the Administrator, with the approval of the Secretary of the Treasury, may from time to time find the loan market demands, but the rate of interest so prescribed by the Administrator shall not exceed at any time the rate of interest (exclusive of premium charges for insurance, and service charges if any), established by the Federal Housing Commissioner under section 203 (b)(5) of the National Housing Act, less one-half of 1 per centum per annum; except that such rate shall in no event exceed 4% per centum per annum. (2) The provisions of the Servicemen's Readjustment Act of 1944 which were in effect before April 1, 1958, with respect to the interest chargeable on loans made or guaranteed under such Act shall, notwithstanding the provisions of paragraph (1) of this subsection, continue to be applicable— (A) to any loan made or guaranteed before April 1, 1958; and (B) to any loan with respect to which a commitment to guarantee was entered into by the Administrator before April 1, 1958. (d)(1) The maturity of any non-real-estate loan shall not be more than ten years. The maturity of any real-estate loan (other than a loan on farm realty) shall not be more than thirty years, and in the case of a loan on farm realty, shall not be more than forty years. (2) Any loan for a term of more than five years shall be amortized in accordance with established procedure. (3) Any real-estate loan (other than for repairs, alterations, or improvements) shall be secured by a first lien on the realty. Any non-real-estate loan (other than for working or other capital, merchandise, goodwill, and other intangible assets) shall be secured by personalty to the extent legal and practicable.

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^2 USC 1709. 38 USC 6<.)3note,

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