WILLIAM DONALD SCHAEFER, Governor

Ch. 311

[(i)] (1) Deferred payment of principal and
interest until the maturity date or the date of any sale or other
transfer of the building or an interest in the building;

[(ii)] (2) Increased rate of interest or
accelerated payment of principal and interest if the borrower no
longer qualifies for the loan; or

[(iii)] (3) Advance payment to a nonprofit
sponsor for certain development costs including architects',
engineers' and attorneys' fees.

[(6) (i)] (G) (1) Loans may not exceed an amount the
Secretary shall establish by regulation and they may not be made
where comparable private financing is available to the
prospective borrowers. Loans over $5,000 shall be secured by a
recorded mortgage or deed of trust on real property. Loans shall
be made from the fund to families of limited income owning and
occupying the building to be rehabilitated, or to sponsors or
nonprofit sponsors. Loans may be either insured or uninsured as
the Department requires. Loans may cover the costs of a
rehabilitation project and closing costs of the loan. Loans may
cover costs related to the implementation of a rehabilitation
project such as appraisal fees or architectural and engineering
fees.

[(ii)] (2) Except as provided in [subparagraph
(iii) of this paragraph] PARAGRAPH (3) OF THIS SUBSECTION, loans
shall be at a rate of interest that is, as long as the State
complies with any applicable federal treasury regulations
governing the borrowing of moneys by the [State] STATE, at least
sufficient to cover:

[1.] (I) All administrative and other
expenses of the program;

[2.] (II) Reasonably expected losses due
to defaults on loans; and

[3.] (III) The interest cost of moneys
used to fund the program, which may be the actual interest cost
of moneys borrowed by the State and appropriated to the program,
or the imputed interest cost of general funds or loan repayments
appropriated to the program.

[(iii)] (3) For any loan financing a
rehabilitation project for a residential building, the Department
may set a lower rate or rates of interest if:

[1.] (I) The loans serve families of
limited income whose incomes do not exceed 80 percent of the
maximum income limits that the Secretary may establish and the
lower rate or rates are not less than the greater of 60 percent

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