Mortgage Insurance-Purchase of Sales-Type Cooperative Housing Units (14.132)

 

Program

14.132 Mortgage Insurance-Purchase of Sales-Type Cooperative Housing Units

 

Federal Agency

HOUSING, DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

 

Authorization

National Housing Act, as amended, Section 213; Housing Act of 1950; Public Law 81-475; 12 U.S.C. 1715(e).

 

Program Number

14.132

 

Last Known Status

Active

 

Objectives

To make available, good quality, new housing for purchase by individual members of a housing cooperative.

 

Types of Assistance

Guaranteed/Insured Loans.

 

Uses and Use Restrictions

HUD insures lenders against loss on mortgages. Insured mortgages may be used to finance purchase by a cooperative member under the sponsorship of a nonprofit cooperative with five or more units. The unit mortgage limit is the same as Section 203(b).

 

Eligibility Requirements

Applicant Eligibility

Eligible mortgagors include members of nonprofit cooperative ownership housing corporations or trusts which sponsor such housing.

Beneficiary Eligibility

Individuals/families and nonprofit organizations.

Credentials/Documentation

Documentation regarding the characteristics of the property and the qualifications of the mortgagor are assembled by the mortgagee and submitted with the application. This program is excluded from coverage under OMB Circular No. A-87.

 

Application and Award Process

Preapplication Coordination

None. This program is excluded from coverage under E.O. 12372.

Application Procedure

Application is submitted for review and approval to the local HUD field office through a HUD-approved mortgagee. This program is excluded from coverage under OMB Circular Nos. A-102 and A-110.

Award Procedure

See Application Procedure.

Deadlines

None.

 

Range of Approval/Disapproval Time

Appeals

HUD will state the reasons for refusing an application. The applicant may reapply subject to concurrence of the lender.

Renewals

The term of a commitment to insure may be extended when more time is desired.

 

Assistance Considerations

Formula and Matching Requirements

The maximum amount of the loan is the same as under Section 203(b) - program 14.117, except that the mortgage shall not exceed an amount equal to the portion of the unpaid balance of the blanket mortgage covering the cooperative which is attributable to the dwelling unit. The downpayment is the difference between the maximum loan amount and the purchase price of the home, but in no case less than $200. The mortgage insurance premium is one-half percent of the mortgage amount.

Length and Time Phasing of Assistance

The mortgage term is 30 years, except 35 years if the mortgagor is unacceptable under a 30-year term.

 

Post Assistance Requirements

Reports

Defaults in meeting the mortgage terms must be reported. All approved mortgagees at any time upon request by HUD must furnish a copy of their latest financial statement.

Audits

The Department of Housing and Urban Development reserves the right to audit the account of the mortgagee to determine its compliance and conformance with HUD regulations and standards.

Records

Mortgagees are required to service and maintain records in accordance with acceptable mortgage practices of prudent lending institutions and the HUD regulations.

 

Program Accomplishments

Because of the small number of loans in any given year, the data is included in the number of loans insured under Section 203(b), 14.117.

 

Financial Information

Account Identification

86-4077-0-3-371.

Obligations

(Mortgages insured) Reported under program 14.135.

Range and Average of Financial Assistance

See Uses and Use Restrictions.

 

Regulations, Guidelines and Literature

HUD-17-F(3) "Let's Consider Cooperatives," no charge; 24 CFR 213, subpart C; HUD Handbook No. 4550.6, "Sales Type Cooperatives."

 

Related Programs

14.126, Mortgage Insurance_Cooperative Projects; 14.163, Mortgage Insurance_Single Family Cooperative Housing.

 

Information Contacts

Regional or Local Office

Persons are encouraged to contact the Homeownership Center serving their State, the nearest local HUD Office. See Catalog Address Appendix IV for a list of Offices.

Headquarters Office

None.

Web Site Address

http://www.hud.gov/progdesc/coops213.cfm

 

Examples of Funded Projects

Not applicable.

 

Criteria for Selecting Proposals

Not applicable.