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organization in carrying out certain neighborhood development activities.

Neighborhood strategy area-Area in which concentrated housing rehabilitation and community development block grant activities are being undertaken.

Nonentitlement area-For purposes of the CDBG program, an area that is neither a metropolitan city nor urban county, and is therefore generally ineligible for direct grants from HUD.

Nonprofit sponsor-A group organized to undertake a housing project for reasons other than making a profit.

Notice of funding availability-A notice by HUD to inform potential project sponsors that contract authority is available.

Off-budget program-Federal program the transactions of which are not included in the Budget of the United States Government as a result of statutory requirement.

Operating subsidies-HUD payments to public housing agencies to assist the payment of operating expenses of public housing, or to the owners of certain multifamily projects for low income families. See section 9 of the United States Housing Act of 1937.

Participation loan-Loans made by the FmHA or others when another lender makes part of the loan.

Pass through-Principal and interest receipts on housing mortgages are "passed through" by GNMA, FNMA, FHLMC, or other organizations to the purchasers of their securities or obligations that have been sold and secured by the mortgages set aside as security for the obligations.

Planned unit development-Development and construction of a residential community as a unit in accordance with a plan for the entire development.

Pledged account mortgage-A graduated payment mortgage in which part of the buyer's down payment is deposited in a savings account. Funds are drawn from the account to supplement the buyer's monthly payments during the early years of the loan.

Pocket of poverty-For purposes of the UDAG program, a contiguous area of particularly severe poverty in a city or urban county. A city or urban county that fails to meet the general eligibility standards for UDAG assistance may be eligible if it contains such

an area.

Prepayment penalty-A penalty that may be levied for repayment of a loan before it falls due.

Price-level adjusted mortgage-Mortgage under which the outstanding balance is adjusted according to an established price index, while the interest rate remains fixed.

Principal-The amount of debt, exclusive of accrued interest, remaining on a loan. Before any principal has been repaid, the total loaned amount is the principal.

Private mortgage insurance-Insurance by private companies of lenders against losses on mortgage loans.

Program reservation-HUD action reserving funds for a specific approved public housing project. This reservation is subject to PHA fulfillment of all HUD requirements.

Public housing-Lower income housing owned and operated by a public housing agency and assisted under the United States Housing Act of 1937 (other than under section 8 or 17).

Public housing agency-Public agency established by a State or local government to finance or operate low-income housing assisted under the United States Housing Act of 1937.

Real estate investment trust-A trust established by real estate investors primarily for the management and control of investments in mortgages and to sell obligations secured by mortgages and property held by the trust.

Recapture-Requiring repayment of assistance provided, either because the assistance has not been used within a certain period of time or a specified event (such as the sale of assisted property) occurs that permits repayment of all or a part of the assistance. See section 235(c)(2) of the National Housing Act.

Refinancing-Payment of a loan with amounts borrowed under a

new loan.

Rehabilitation-The improvement or repair of property. Such term includes substantial and moderate rehabilitation, but excludes new construction.

Rehabilitation loans-Loans made by HUD under section 312 of the Housing Act of 1964 for the rehabilitation of property.

Reinsurance-Program under section 249 of the National Housing Act to demonstrate possible advantages of having private mortgage insurance companies enter into reinsurance contracts with HUD, under which such private insurers would assume a percentage of the risk on certain single-family mortgages insured by HUD. Rent control-Limitation of annual rent increases by municipal ordinance, State, or Federal law.

Rent supplements-Annual Federal payments to owners of housing built with certain HUD mortgage insurance on behalf of prescribed types of lower income families.

Rental assistance payments-Generally refers to the FmHA program of rental assistance for low income families in rural areas under section 521(a)(2)(A) of the Housing Act of 1949.

Replacement cost-The basis of one of the limits placed on the amount of a mortgage that can be insured by HUD under certain programs, such as the mortgage may not exceed 90 percent of replacement cost of the housing when completed.

Reverse annuity mortgage-See "home equity conversion mortgage".

Rural area-A non-urban area meeting the requirements of section 520 of the Housing Act of 1949 and eligible assistance under the FmHA housing programs.

Second mortgage-A mortgage that grants rights subordinate to the rights granted by the initial mortgage. A second mortgage generally bears a higher rate of interest than the initial mortgage to reflect the greater risk of the lender.

Secondary mortgage market-Nationwide market for the purchase and sale of mortgages. FHLMC, FNMA, and GNMA are the 3 federally established entities that purchase mortgages in the secondary mortgage market, thereby increasing the availabilty of funds to financial institutions for additional residential loans.

Seed money-Advances, loans, or grants to cover preliminary expenses of constructing housing projects, such as the cost of planning and obtaining financing.

Shared appreciation mortgage-Mortgage under which the borrower receives financial assistance in purchasing a property and agrees in return to give the lender a portion of the future increase in the value of the property.

Shared housing-Generally refers to arrangements under which elderly and handicapped persons share the facilities of a dwelling with others in order to meet their housing needs and reduce the costs of housing. See section 8(p) of the United States Housing Act of 1937.

Single-family housing-Generally a structure containing dwelling units for 1 to 4 families.

Single room occupancy housing-Residential properties in which some or all dwelling units do not contain bathroom or kitchen facilities. See section 8(n) of the United States Housing Act of 1937. Small city-A city that does not qualify as a metropolitan city for purposes of receiving a community development block grant under section 106 of the Housing and Community Development Act of 1974.

Standby commitment-See "commitment".

Substantial rehabilitation-Improvements of a property from substandard to safe and sanitary conditions. It can vary from gutting and reconstruction to accumulated deferred maintenance. It may also involve conversion of nonresidential property to residential use.

Supplemental loans-HUD-insured loans under section 241 of the National Housing Act for improvements or additions to multifamily housing, nursing homes, group practice facilities, or hospitals. Tandem plan purchases-The purchase by GNMA of certain housing mortgages at higher prices than would be paid by FNMA, FHLMC or other mortgage purchasers, with subsequent resale by GNMA at the best price obtainable, or as back-up of GNMA's mortgage-backed securities. The term derives from the original practice of FNMA purchasing from GNMA "in tandem" with the GNMA purchase.

Temporary mortgage assistance payments-Mortgage assistance payments authorized to be made under section 230(a) of the National Housing Act to a mortgagor of a single-family residence who defaults on the mortgage due to circumstances beyond the mortgagor's control. Constitutes an alternative to acquisition of the mortgage by HUD under section 230(b) of the National Housing Act.

Tenant contribution-The monthly amount of rent required to be paid by a tenant receiving rental assistance under a Federal housing program. Currently is 30 percent of monthly adjusted family income. See section 3(a) of the United States Housing Act of 1937. Total development costs-The sum of all HUD-approved costs for planning, administration, site acquisition, relocation, demolition, construction and equipment, interest and carrying charges, on-site streets and utilities, nondwelling facilities, a contingency allowance, insurance premiums, off-site facilities, any initial operating deficit, and all other costs necessary to develop the project.

Troubled housing-Rental or cooperative housing project receiving assistance from HUD under section 201 of the Housing and Community Development Amendments of 1978 to restore financial

soundness, improve management, and maintain the low and moderate income character of the project.

Turnkey housing-Housing initially financed and built by private sponsors and purchased upon completion by public housing agencies for use by lower income families under the public housing program.

Unit of general local government-A general purpose political subdivision of a State, such as a county, city, township, town, or village.

Urban county-For purposes of the CDBG and UDAG programs, generally refers to a county in a metropolitan area that has a combined population of not less than 200,000.

Urban development action grant-A grant made to an urban county, city, or unincorporated portion of an urban county under section 119 of the Housing and Community Development Act of 1974.

Urban homesteading-Program of HUD transfers of unoccupied residences under section 810 of the Housing and Community Development Act of 1974 to individuals or families without any substantial consideration where the individuals or families agree to occupy the residences not less than 5 years and to make repairs and improvements required to meet health and safety standards within certain time limits. Under a demonstration multifamily homesteading program, HUD transfers properties to local governments for conversion or rehabilitation to use primarily as housing for lower income families.

Urban renewal-Elimination and prevention of the development or spread of slums and blight, including slum clearance and redevelopment, or rehabilitation and conservation, assisted by HUD advances, loans, and grants under title I of the Housing Act of 1949. Program is being terminated under the provisions of title I of the Housing and Community Development Act of 1974.

Usury laws-Laws limiting the maximum rate of interest that may be charged on a loan.

Vacancy rate-In reference to dwelling units, the percentage of the total dwelling units in an area that are vacant and available for residence.

Variable interest rate-A means by which a lender is permitted to adjust the interest rate on a loan to reflect changes in the prime rate-usually within a prescribed range and with advanced notice. Very low-income family-Generally, a family whose income does not exceed 50 percent of the median family income of the area involved.

Voucher demonstration-Demonstration program of rental assistance under section 8(0) of the United States Housing Act of 1937. Assistance payments are provided for an eligible family based on the difference between the payment standard established by the Secretary for the area involved and 30 percent of the family's monthly adjusted income. The tenant contribution is the difference between the rent negotiated by the family and the amount of the monthly assistance payment.

CONVERSION TABLES

Following are tables converting Public Laws citations to United States Code Citations. The tables have been prepared for the National Housing Act, Title I of the Housing and Community Development Act of 1974 (Community Development Block Grants and Urban Development Action Grants), the United States Housing Act of 1937, and title V of the Housing Act of 1949 (Rural Housing).

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