[Federal Register Volume 64, Number 78 (Friday, April 23, 1999)]
[Rules and Regulations]
[Pages 19895-19896]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-10137]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
24 CFR Parts 203 and 204
[Docket No. FR-4288-N-03]
RIN 2502-AH08
Withdrawal of Interim Rule on Builder Warranty for High Ratio
FHA-Insured Single Family Mortgages for New Homes
AGENCY: Office of the Assistant Secretary for Housing-Federal Housing
Commissioner, HUD.
ACTION: Withdrawal of interim rule.
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SUMMARY: This notice withdraws an interim rule, published on March 25,
1999, that would have permitted FHA insurance for a mortgage on a new
home to exceed a 90 percent loan-to-value ratio if the home is covered
by a 1-year builder warranty that meets the requirements of HUD
regulations. This rule would have replaced a 10-year builder warranty
requirement.
DATES: This withdrawal is effective April 23, 1999.
FOR FURTHER INFORMATION CONTACT: Vance Morris, Director, Home Mortgage
Insurance Division, Room 9266, Department of Housing and Urban
Development, 451 Seventh Street, SW., Washington, DC 20410, (202) 708-
2700. (This is not a toll free number.) For hearing- and speech-
impaired persons, this number may be accessed via TTY by calling the
Federal Information Relay Service at 1-800-877-8339.
SUPPLEMENTARY INFORMATION: On March 25, 1999, HUD published an interim
rule for public comment. This rule, scheduled to take effect on April
27, 1999, would have permitted FHA insurance for a mortgage on a new
home to exceed a 90 percent loan-to-value ratio if the home is covered
by a 1-year builder warranty that meets the requirements of HUD
regulations. This rule would have eliminated a 10-year builder warranty
requirement.
There was favorable reaction to HUD's change in warranty
requirements when first announced. However, since publication of the
interim rule, some affected parties have expressed concern about the
elimination of a 10-year warranty requirement and have requested that
HUD further consider the matter before allowing the change in warranty
requirements to take effect.
HUD continues to believe, as noted in the interim rule, that the
quality of housing and building technology has improved so
substantially that a 10-year warranty requirement is excessive, and a
comprehensive 1-year builder warranty provides valuable consumer
protection and is consistent with current industry practices and
requirements. Nevertheless, HUD agrees to further consider this issue.
HUD is therefore withdrawing the March 25, 1999 interim rule. HUD
will reissue this rule as a proposed rule and take additional public
comment on this subject.
Accordingly, the interim rule to amend 24 CFR parts 203 and 234,
published on March 25, 1999, at 64 FR 14572, entitled, Builder Warranty
for High Ratio FHA-Insured Single Family Mortgages for New Homes, is
hereby withdrawn.
[[Page 19896]]
Dated: April 15, 1999.
William C. Apgar,
Assistant Secretary for Housing-Federal Housing Commissioner.
[FR Doc. 99-10137 Filed 4-22-99; 8:45 am]
BILLING CODE 4210-27-P
