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LAWS OF MARYLAND

Ch. 608

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF
MARYLAND, That section(s) of the Annotated Code of Maryland
be repealed, amended, or enacted to read as follows:

Article 41 — Governor — Executive and
Administrative Departments

257K.

(a)    The General Assembly declares that it is a
subject of concern that many residents of this State are
living in substandard housing and that there exists a
shortage of housing at reasonable costs for various income
levels. The General Assembly recognizes that adequate
multiple unit and single family housing can, and should, be
provided by private capital under our free enterprise system
and in accordance with sound investment practices. The
General Assembly finds that the flow of private investment
capital into such housing can be stimulated by a system
wherein qualified lending institutions may be insured
against losses incurred as a result of nonpayment of
principal, interest, or other sums agreed to be paid under
the terms of any note or bond or other evidence of
indebtedness. The General Assembly further finds that such
mortgage insurance can assist State and local activity to
finance housing and rehabilitation. In furtherance of such
State interest, there is established a Maryland Housing
Fund.

(b)   The Department of Economic and Community
Development shall manage and supervise the Maryland Housing
Fund. The fund shall be deposited with the State Treasurer
to be held in such banks as he deems proper and shall be
accounted for by the State Comptroller in a special account
known as the "Maryland Housing Fund." The fund shall be
invested and reinvested in the same manner as other State
funds. The fund shall be used to insure mortgages accepted
by the Department under the provisions of this subheading.

(c)   The Department, upon authorization by the
mortgagee, may insure upon such terms as it may prescribe
any mortgage offered which is eligible for insurance under
the provisions of this section. FOR THE PURPOSES OF THIS
SECTION, THE TERM "MORTGAGE" INCLUDES LOANS TO FINANCE OR
REFINANCE THE PURCHASE OF STOCK OR MEMBERSHIP OR TO
REHABILITATE UNITS IN A COOPERATIVE OWNERSHIP HOUSING
CORPORATION. Fees shall be established for said insurance
in an amount calculated to cover administrative costs for
this program as well as payments made where defaults on
mortgages cause insured losses to the lenders.

SECTION 2. AND BE IT FURTHER ENACTED, That this Act
shall take effect July 1, 1979.