§1715z–5 Purchase of fee simple title from lessors

Summary

The Secretary can agree to insure loans that approved lenders make so people who lease land long-term can buy the full ownership (fee simple) of the land their house sits on. Financial institution — a lender the Secretary has approved under the mortgage insurance rules (sections 1703 or 1709(b)(1)). Homeowner — a person who leases the land under a long-term ground lease. To qualify, the loan must be for a dwelling built mainly as a one-, two-, three-, or four-family home; not more than the cost of buying the fee simple title or $10,000 per family unit ($30,000 in Hawaii), whichever is less; when added to existing debt on the property stay within the mortgage limit in section 1709(b); have an interest rate the borrower and lender agree on; have a term acceptable to the Secretary but no more than 20 years from the start of amortization; and meet any other rules the Secretary sets. Certain rules in section 1715k(h) (paragraphs (3), (5), (6), (7), (8), and (10)) also apply to these loans, with references to “home improvement loans” or “this subsection” treated as referring to these loans.