ROBERT L. EHRLICH, JR., Governor                                Ch. 8

(5)     The Department may require an affidavit from an applicant for a
loan under this subsection confirming other governmental or commercial sources of
assistance, which may be shared with FEMA, SBA, or other governmental agencies
that provide assistance.

(6)     The Department may establish priorities for making loans available
under this subsection.

(e) (1) This subsection applies to housing rehabilitation or, renovation, or
onsite replacement loans obtained in the private market for which the Department
serves as guarantor provides credit enhancement.

(2) The Program is designed to facilitate the availability and utilization
of private market loans for the rehabilitation and, renovation, or onsite replacement
of primary residences damaged by Hurricane Isabel by a family:

(i) who otherwise meets the qualifications for a loan offered by a
financial institution; and

(ii) 1. who has been relocated into temporary housing by or has
received rental assistance from FEMA, or who has not obtained any assistance from
FEMA but otherwise qualifies for such assistance; or

2. whose primary residence has been found to be partially or
totally uninhabitable.

                 (3) A loan for which the Department serves as guarantor provides credit

enhancement under this subsection:

(i) may include the refinancing of existing mortgage loans on the
primary residence; and

(ii) may not include a home equity line of credit.

(4)     The Department shall approve and make available to prospective
borrowers a list of financial institutions that are willing to offer loans for which the
Department may serve as guarantor provide credit enhancement under this
subsection.

(5)     The Department shall serve as guarantor provide credit
enhancement of a loan under this subsection for the amount of the loan proceeds that
is over 90% 80% and up to 115% of the expected fair market value of the homo
property after the rehabilitation and, renovation, or onsite replacement is completed,
as determined by an appraisal at the time the loan is closed used to process and
approve the loan.

(6)     (i) The Department shall ensure determine that the terms and
provisions of a loan offered by a financial institution for which the Department serves
as guarantor provides credit enhancement are reasonable and reflective of the
mortgage market.

(ii) The payment of the principal and interest on loan proceeds paid
out from time to time as renovations and rehabilitations are completed may be

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