Quiero saber acerca de...

9416
thrift Institutions in which people may invest their funds and to provide for the financing of homes. Recognizing that such associations would find it de sirable and perhaps necessary to make other than home loans the statute au thorizes within 20 percent of the assets of an association loans on other im proved real estate. The statute does not contemplate that Federal associa tions be authorized to finance commer cial enterprises which incidentally con tain residential quarters, except within the 20 percent of assets limitation. In the light of these statutory provisions, it can not be said that motels which are commercial undertakings are embraced in the definition of combination home and business property any more than would a hotel consisting of hundreds of rooms and one or two apartments for use by the owner or manager or other per sonnel. On the other hand, if the busi ness use tourist units is merely incidental to the residential use of the security property, it would qualify as combination home and business property.
c Completed; definition of. For the purposes of 545.6-1 a 4 of this sub chapter, pertaining to loans in excess of 80 percent of the value of the security, a residential structure is deemed to be completed when, in conformity with gen eral practice in the community, it is ready for occupancy. For instance, the house on which the mortgage is being taken has been completed except for the second coat of exterior painting which can not be completed for reasons of weather, or the street has not been com pleted, but sufficient funds to pay for such work are to be held in escrow until it is done; the structure would be con sidered completed for the purposes of the regulation if it would be considered, by reason of local practice and custom, to be ready for occupancy.
d Paving liens against; power to purchase. A Federal association may purchase a paving certificate which con stitutes a lien on property securing an association loan, if that is necessary to protect its interest in the property.
However, a Federal association may not acquire such certificates as to property on which it does not have a mortgage or for the purpose of making an investment.

RULES AND REGULATIONS

payment of the obligation secured by the real estate security for its loans.
such instrument, provided the instru Subject to this limitation, those who ment is of such a nature that, in the borrow from Federal associations on real event of default, the real estate described estate security should have reasonable in such instrument could be subjected to freedom of choice in the placing of haz the satisfaction of such obligation with ard insurance on their property.
the same priority as a first mortgage or b
Life; premiums on; advances for.
a first deed of trust in the jurisdiction The fourth sentence of 545.6-11 of this where the real estate is located. While subchapter authorizes an association to a first mortgage in itself evidences a first make unsecured advances for the pay lien on realty it is, before foreclosure is ment of life insurance premiums in con completed, personal property in the nection with real estate loans. On the hands of the mortgagee. A mortgage other hand, applicable law and regula and accompanying note may be assigned tion do not contemplate, and are not as collateral security for a debt, but the considered to permit, the indiscriminate mortgagee remains the owner of the making of unsecured loans to finance life mortgage. The assignees interest is insurance premiums Any lending pro contingent. An assignment of a note gram which in general practice contem and mortgage as collateral security for plates or gives promise of unsecured, a loan by a Federal association would advances to pay insurance premiums not permit the association, in the event is deemed to be without regulatory of the borrowers default without default sanction.
by the mortgagor, to subject the real estate described in the assigned mort 555.6 Unsecured loans; refinancing o f ; authority for.
gage to the satisfaction of the obligation A Federal association may not make an owed the association. Such a loan would not be a loan on the security of a uninsured, unsecured loan to réfinanee a first lien on real estate as defined in the loan previously made by another associa regulations, but would be a loan on the tion for property alteration, repair or im security of assigned personal property. provement, for the reason that its invest This same reasoning and conclusion ment would not be an investment in the would apply to the assignment of a note original loan which was for property and real estate contract as collateral alteration, repair or improvement, but on security for a loan by a Federal associa the contrary would be an investment in tion.
its own loan, which would be for the b Security for; shares pledged for refinancing of the other institutions excess over 90 percent loaned under loan. The transaction would not be 545.6 -l a 4 of this subchapter. A within the authority conferred by sub loan may not be made under 545.6-1 section c of section 5 of the Home a 4 of this subchapter for an amount Owners Loan Act of 1933, as amended, to in excess of the maximum therein pro invest in other loans for property alter vided, with such excess secured by the ation, repair or improvement. A Fed pledge of a savings account as collateral. eral association may, however, make an The maximum amount of the principal uninsured, unsecured loan to refinance obligation of a loan made pursuant to or recast for a borrower the unpaid bal that section is limited to 90 percent of ance of an uninsured, unsecured loan the value of the property or 90 percent to such borrower made and still held by of the purchase price, whichever is lower, the association, provided the loan as and in no event in excess of $18,000. originally made complied in all respects In other words, the amount of the prin with 545.8 of this subchapter, and pro cipal obligation of a loan under this sec vided the refinanced or recast loan is tion is determined only by a formula evidenced by a note or notes the amount which is strictly related to either the and terms of which are such as could purchase price or the value of the prop have been made by the association as an erty, with a ceiling of $18,000.
original loan pursuant to said section.
c Servicing of; agent for; right of However, the loan as recast could exceed Federal association to act as. The serv $3,500 if such excess is solely by reason icing of loans by a Federal association of inclusion of loan charges permissible 555.4 Real estate loans.
under 545.11 of this subchapter can be under 545.6-10 of this subchapter, in a
Security for; assignment of notesundertaken only to such extent as would clusion of accrued interest whether due and mortgages as. Collateral loans be reasonably incidental to the accom or n o t, or carrying over of original gross secured by assignment of first lien notes plishment of its express objects. For charges into the new evidence or evi and mortgages held by the borrower are example, an association may agree to dences of debt or of new items of gross not loans made on the security of first service loans which it sells. However, charges.
liens on real estate as contemplated by there is no general corporate power in 555.7
Share loans;
security for;
the statute and therefore may not be Federal associations to act as service shares purchased with proceeds of made by Federal associations. Section agent for the public in connection with the loan.
5c of the Home Owners Loan Act, as the handling of mortgage loans of other A
savings account in a sufficient amended, provides that Federal associa parties, and for an association to under tions shall lend their funds only on the take to do so would be in excess of its amount must be in existence before a share loan may be made. The provision security of first liens upon homes corporate powers.
of section 5 a of the Home Owners or combination homes and business 555.5 Insurance.
Loan Act of 1933, as amended, that such property
This provision of the a
Hazard; control over placing of.associations shall lend their funds only statute has been construed and defined on the security of their shares or on the in 541.9 of this subchapter as follows: The board of directors of each Federal savings and loan association has not only security of first liens is not con The term loans on the security of first the right but the duty to establish and strued to mean that the share collateral liens means loans on the security of any maintain such requirements over hazard put up as security for the loan may he instrument which makes the in insurance as in the fair and considered acquired by the borrower out of the pro terest in the real estate described judgment of such directors are necessary ceeds of the samé loan. In the context therein specific security for the to protect the associations interest in in which the words appear in the statute