12 U.S.C. § 1715z–15 | Limitation on prepayment of mortgages on multifamily rental housing

(a)

Acceptance of offer to prepay; qualifications

section 1715t of this titleDuring any period in which an owner of a multifamily rental housing project is required to obtain the approval of the Secretary for prepayment of the mortgage, the Secretary shall not accept an offer to prepay the mortgage on such project or permit a termination of an insurance contract pursuant to unless—

(1)

the Secretary has determined that such project is no longer meeting a need for rental housing for lower income families in the area;

(2)

the Secretary (A) has determined that the tenants have been notified of the owner’s request for approval of a prepayment; (B) has provided the tenants with an opportunity to comment on the owner’s request; and (C) has taken such comments into consideration; and

(3)

the Secretary has ensured that there is a plan for providing relocation assistance for adequate, comparable housing for any lower income tenant who will be displaced as a result of the prepayment and withdrawal of the project from the program.

(b)

Approval prior to foreclosure

section 4119 of this titleA mortgagee may foreclose the mortgage on, or acquire by deed in lieu of foreclosure, any eligible low-income housing project (as such term is defined in ) only if the mortgagee also conveys title to the project to the Secretary in connection with a claim for insurance benefits.

(c)

“Lower income families” defined

section 1437a(b)(2) of title 42For purposes of this section, the term “lower income families” has the meaning given such term in .

June 27, 1934, ch. 847 Pub. L. 98–181, title INov. 30, 198397 Stat. 1221 Pub. L. 100–242, title II, § 261Feb. 5, 1988101 Stat. 1890 Pub. L. 101–235, title II, § 202(d)(1)Dec. 15, 1989103 Stat. 2037 Pub. L. 101–625, title VI, § 602(b)Nov. 28, 1990104 Stat. 4277(, title II, § 250, as added [title IV, § 433], , ; amended , , ; , , ; , (c), , .)

Editorial Notes

Amendments

Pub. L. 101–625, § 602(b)section 1715z–1 of this titlelsection 1701q of this title section 1437f of title 421990—Subsec. (b). , amended subsec. (b) generally. Prior to amendment, subsec. (b) read as follows: “In the case of a project assisted under or the proviso to section 1715(d)(5) of this title, section 101 of the Housing and Urban Development Act of 1965, or where the owner has the right to prepay the mortgage covering the assisted project without the Secretary’s approval, the Secretary shall give a priority for additional assistance under and section 201 of the Housing and Community Development Amendments of 1978 to tenants and applicants to become tenants of the project, if—

“(1) funds to provide such additional assistance are available; and

“(2) the Secretary determines that making such additional assistance available to the project is necessary to prevent the owner from prepaying the mortgage.”

Pub. L. 101–625, § 602(c)section 1437f of title 42Subsecs. (c), (d). , redesignated subsec. (d) as (c) and struck out former subsec. (c) which read as follows: “Any owner of a multifamily rental housing project referred to in subsection (b) of this section who receives additional assistance under under the priority established in subsection (b) of this section shall—

“(1) fully utilize the assistance which is available;

“(2) grant a priority to applicants to become tenants who have the lowest incomes; and

“(3) maintain the low-income character of the project for a period at least equal to the remaining term of the project mortgage to the extent that assistance is provided.”

Pub. L. 101–235 section 1715t of this title1989—Subsec. (a). inserted “or permit a termination of an insurance contract pursuant to ” after second reference to “project”.

Pub. L. 100–2421988—Subsec. (a)(1). struck out “or that the needs of lower income families in such project can more efficiently and effectively be met through other Federal housing assistance taking into account the remaining time the project could meet such needs” after “families in the area”.