[Federal Register Volume 60, Number 245 (Thursday, December 21, 1995)]
[Rules and Regulations]
[Pages 66476-66477]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-31076]
[[Page 66475]]
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Part IV
Department of Housing and Urban Development
_______________________________________________________________________
Office of the Assistant Secretary for Housing--Federal Housing
Commissioner
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24 CFR Parts 203 and 206
Home Equity Conversion Mortgage Insurance Demonstration: Streamlining
the Demonstration and Allowing Use of the Direct Endorsement Program;
Final Rule
Federal Register / Vol. 60, No. 245 / Thursday, December 21, 1995 /
Rules and Regulations
[[Page 66476]]
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
Office of the Assistant Secretary for Housing-Federal Housing
Commissioner
24 CFR Parts 203 and 206
[Docket No. FR-2958-F-03]
RIN 2502-AF32
Home Equity Conversion Mortgage Insurance Demonstration:
Streamlining the Demonstration and Allowing Use of the Direct
Endorsement Program
AGENCY: Office of the Assistant Secretary for Housing-Federal Housing
Commissioner, HUD.
ACTION: Final rule.
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SUMMARY: This rule makes final, without substantive changes, the
interim rule that was promulgated by the Department on August 16, 1995,
to amend HUD's regulations in 24 CFR parts 203 and 206. The interim
rule simplified the Home Equity Conversion Mortgage (HECM) Insurance
Demonstration and expedited the processing of HECMs by permitting use
of the Direct Endorsement program. The interim rule also implemented
the statutory disclosure amendments in section 334 of the Cranston-
Gonzalez National Affordable Housing Act and made other changes,
including technical and clarifying changes, to improve and streamline
the program based on the first five years of the demonstration. This
final rule does contain a correction to a technical error in the
interim rule.
EFFECTIVE DATE: January 22, 1996.
FOR FURTHER INFORMATION CONTACT: Richard K. Manuel, Acting Director,
Single Family Development Division, Office of Insured Single Family
Housing, Room number 9272, Department of Housing and Urban Development,
451 Seventh Street, SW, Washington, DC 20410, telephone (202) 708-2700;
TDD (202) 708-9300. (These are not toll-free telephone numbers.)
SUPPLEMENTARY INFORMATION: The Home Equity Conversion Mortgage (HECM)
Insurance Demonstration was authorized by Section 417 of the Housing
and Community Development Act of 1987 (42 U.S.C. 5301), which amended
Section 255 of the National Housing Act (12 U.S.C. 1715z-20) to permit
elderly homeowners to borrow against the equity in their homes. HUD
published final regulations on June 9, 1989, at 54 FR 24823, issued HUD
Handbook 4235.1 for the program in August 1989, and immediately began
processing applications for commitments to insure. The regulations were
codified at 24 CFR part 206. Revision 1 to HUD Handbook 4235.1 was
issued in November 1994.
On August 16, 1995, the Department promulgated an interim rule, at
60 FR 42754, which reflected ideas for improving the program
regulations based on experience from the first five years of the
demonstration. It also reflected HUD's implementation of section 334 of
the Cranston-Gonzalez National Affordable Housing Act (NAHA) (42 U.S.C.
12701), regarding additional disclosures to the mortgagor before loan
closing, including projections of future loan balances and information
that the mortgagor's liability is limited. The public was given 60 days
in which to submit comments on the interim rule, and no public comments
were received. Therefore, this rule makes final the interim rule
without any substantive changes. This final rule does contain a
correction to a technical error in the interim rule. The second and
third sentences of 24 CFR 206.45(b) were inadvertently dropped from the
Code of Federal Register when an amendment was made to the first
sentence of that section. This final rule restates those two sentences.
Other Matters
Environmental Impact
A Finding of No Significant Impact with respect to the environment
has been made in accordance with HUD regulations at 24 CFR part 50,
which implements section 102(2)(C) of the National Environmental Policy
Act of 1969 (NEPA). This Finding of No Significant Impact is available
for public inspection between 7:30 a.m. and 5:30 p.m. weekdays in the
Office of the Rules Docket Clerk, Office of the General Counsel,
Department of Housing and Urban Development, Room 10276, 451 Seventh
Street, SW, Washington, DC 20410.
Impact on Small Entities
The Secretary, in accordance with the Regulatory Flexibility Act (5
U.S.C. 605(b)), has reviewed this final rule before publication and by
approving it certifies that this final rule will not have a significant
economic impact on a substantial number of small entities. This final
rule makes final, without changes, an interim rule that was limited to
revision of the Home Equity Conversion Mortgage Demonstration.
Specifically, the requirements of the interim rule were directed to
making the program more efficient for participating mortgagees,
mortgagors and the Department.
Executive Order 12612, Federalism
The General Counsel, as the Designated Official under section 6(a)
of Executive Order 12612, Federalism, has determined that the policies
contained in this rule will not have substantial direct effects on
States or their political subdivisions, or the relationship between the
Federal government and the States, or on the distribution of power and
responsibilities among the various levels of government. As a result,
the rule is not subject to review under the Order.
Executive Order 12606, The Family
The General Counsel, as the Designated Official under Executive
Order 12606, The Family, has determined that this final rule will not
have potential for significant impact on family formation, maintenance,
and general well-being, and, thus, is not subject to review under the
order. No significant change in existing HUD policies or programs will
result from promulgation of this rule, as those policies and programs
relate to family concerns.
List of Subjects
24 CFR Part 203
Hawaiian natives, Home improvement, Indians--lands, Loan programs--
housing and community development, Mortgage insurance, Reporting and
recordkeeping requirements, Solar energy.
24 CFR Part 206
Aged, Condominiums, Loan programs--housing and community
development, Mortgage insurance, Reporting and recordkeeping
requirements.
Accordingly, the interim rule published on August 16, 1995, at 60
FR 42754, is adopted as final, with the following amendment:
PART 206--HOME EQUITY CONVERSION MORTGAGE INSURANCE
1. The authority citation for part 206 continues to read as
follows:
Authority: 12 U.S.C. 1715b, 1715z-200; 42 U.S.C. 3535(d).
2. In Sec. 206.45, paragraph (b) is revised to read as follows:
Sec. 206.45 Eligible properties.
* * * * *
(b) Type of property. The property shall include a dwelling
designed principally as a residence for one family
[[Page 66477]]
or such additional families as the Secretary shall determine. The
dwelling may be connected with other dwellings by a party wall or
otherwise. A condominium unit designed for one-family occupancy shall
also be an eligible property.
* * * * *
Dated: November 29, 1995.
Nicolas P. Retsinas,
Assistant Secretary for Housing--Federal Housing Commissioner.
[FR Doc. 95-31076 Filed 12-20-95; 8:45 am]
BILLING CODE 4210-27-P
