§ 206.32 - No outstanding unpaid obligations.

§ 206.32 No outstanding unpaid obligations.

In order for a mortgage to be eligible under this part, a mortgagor borrower must establish to the satisfaction of the mortgagee that :

(a) After

after the initial payment of loan proceeds under § 206.25(a), there will be no outstanding or unpaid obligations incurred by the

mortgagor

borrower in connection with the mortgage transaction, except for

repairs to the property required under § 206.47 and

mortgage servicing charges permitted under § 206.207(b)

; and (b) The initial payment

and any future Repair Set Aside established pursuant to § 206.19(f)(1); and the initial disbursement will not be used for any payment to or on behalf of an estate planning service firm.

[64 FR 2988, Jan. 19, 1999]