50 1 Act which involves multifamily housing or a health facility 2 does not exceed the approved percentage of (1) the Secre3 tary's estimate of the value or cost of the land, property or 4 interest prior to the beginning of construction or rehabilita5 tion, plus (2) the Secretary's approved actual cost of such 6 construction or rehabilitation. 7 (b) The Secretary shall require that the mortgagor 8 certify as to the actual cost to the mortgagor of construction 9 or rehabilitation, and may require such additional certifica10 tions of actual cost by such other parties as he may consider necessary to carry out the intent of this section. The Secre 12 tary may exempt from the requirements of this section mort13 gagors under a mortgage on a property or project designed 14 principally for residential use for twelve or fewer families 15 or where the mortgage amount to be insured is less than 16 $250,000. Certifications required pursuant to this section 17 shall be accompanied by such data and records as the Secre18 tary shall prescribe. 19 20 21 2 2 2 2 2 2 2 (c) As used in this section— (1) The term "approved percentage" means the per centage figure which, under applicable provisions of this 22 Act, the Secretary is authorized to apply to his estimate of 23 value, cost, or replacement cost, as the case may be, of the 24 property or project to determine the maximum insurable 25 mortgage amount. 51 1 (2) The term "actual cost" means the costs (exclusive 2 of rebates or discounts) to the mortgagor of the improve3 ments involved. These costs may include amounts paid for 4 labor, materials, construction contracts, engineer's and archi5 tect's fees, off-site public utilities, streets, organizational and 6 legal expenses, taxes and interest during construction, such 7 allocations of general overhead items as are acceptable to 8 the Secretary, and other items of expense approved by the 9 Secretary. If the Secretary determines that a certification of 10 actual cost is required from a builder, contractor, subcontractor, supplier or other party to a transaction because of an identity of interest with the mortgagor or for such other 11 12 13 reason as he may determine, the term "actual cost" may 14 also include an allowance for profit and risk determined to 15 be reasonable by the Secretary but in the case of a mortgage 16 insured under section 502 or in the case of a project deter17 mined by the Secretary to warrant special consideration, the 18 allowance for profit and risk shall be 10 per centum of all 19 other items entering into the term "actual cost". LABOR STANDARDS SEC. 507. (a) The Secretary shall not insure any mortgage or loan under title V involving new or rehabilitated property, except a mortgage covering multifamily housing designed for use by less than twelve families, unless the principal contractor provides adequate assurances to the 52 1 Secretary that all laborers and mechanics employed by con 2 tractors or subcontractors in the construction of the project 3 or facility have been paid wages at not less than those pre4 vailing on similar construction in the locality as determined 5 by the Secretary of Labor in accordance with the Davis6 Bacon Act, as amended (40 U.S.C. 276a-276a-5). The 7 Secretary of Labor shall have, with respect to the labor 8 standards specified in this section, the authority and func9 tions set forth in Reorganization Plan Numbered 14 of 1950 10 (64 Stat. 1267), and section 2 of the Act of June 13, 1934 11 (40 U.S.C. 276c). 12 (b) The Secretary may waive compliance with this 13 section in any case where prospective owners of the dwellings 14 involved, or other persons, voluntarily donate their services 15 without compensation or where laborers or mechanics, not 16 otherwise employed at any time on the project, voluntarily 17 donate their services without full compensation for the pur18 pose of lowering the costs of construction or rehabilitation, 19 and the Secretary determines that any amounts thereby 20 saved are fully credited to the mortgagor undertaking the 21 construction or rehabilitation. 22 23 24 TITLE VI-INSURANCE CLAIMS HOME MORTGAGE INSURANCE CLAIM SETTLEMENT SEC. 601. (a) To be entitled to receive the benefits of 25 the insurance, where there has been a default in mortgage 53 1 payments by the mortgagor, a mortgagee holding a home 2 mortgage insured under one of the sections of title IV shall 3 either foreclose the mortgage and take possession of the 4 property within a period of time prescribed by the Secretary 5 and in accordance with regulations issued by the Secretary 6 or (with the consent of the Secretary) otherwise acquire 7 title and possession of such property. Upon acquisition of the 8 property, the mortgagee shall (1) promptly convey to the 9 Secretary title to the property which meets the requirements 10 of rules and regulations of the Secretary in force at the time 11 the mortgage was insured, and which is evidenced in the 12 manner prescribed by such rules and regulations, and (2) 13 assign to him all claims of the mortgagee against the mort 14 gagor or others, arising out of the mortgage transaction or 15 foreclosure proceedings, except such claims as may have 16 been released with the consent of the Secretary. In lieu of 17 obtaining title and conveying title to the Secretary, the mortgagee may (with the approval of the Secretary) tender title and transfer possession directly from the mortgagor or other 18 19 20 appropriate grantor. The Secretary shall pay the mortgagee's 21 insurance claim in an amount equal to the value of the 2 2 2 2 2 2 22 23 24 mortgage. (b) For the purposes of this section, the value of the mortgage shall be determined (in accordance with rules and 25 regulations prescribed by the Secretary) by adding to and 54 1 deducting from the original principal obligation of the mort 2 gage which was unpaid on the date of the institution of fore3 closure proceedings, or on the date of the acquisition of the 4 property after default other than by foreclosure, certain items 5 specified in subsections (c) through (e). 6 (c) There shall be added to such unpaid principal all 8 liens prior to the mortgage; (2) special assessments which are noted on the application for commitment or which become liens after the insurance of the mortgage; (3) charges for the administration, operation, maintenance, and repair of community-owned property or the maintenance and repair of the mortgaged property, the obligation for which arises out of a covenant filed for record and approved by the Secretary prior to the insurance of the mortgage; (4) insurance on the property; (5) mortgage insurance premium; (6) foreclosure, acquisition, and conveyance costs approved by the Secretary, including payments made by the mortgagee for the cost of acquiring the property and conveying and evidencing title to the property to the Secretary; 66-138 0-71 pt. 1 - 18 |