§1747f — Title 12 Banks and Banking | U.S. Code

Summary

When a project's net income for a year is less than the sum of its minimum annual amortization charge and its insured annual return, an investor can file a claim. After the investor proves the claim, the Secretary must pay the cash difference from the General Insurance Fund, as the Secretary decides, but never more than the total of those two amounts. An investor may assign, pledge, or transfer any rights or claims under the insurance contract to others (including debenture holders or their trustee), subject to the Secretary’s rules. The Secretary may pay claims or issue debentures to those assignees, pledgees, or transferees.

Title 12, §1747f

Banks and Banking — Source: USLM XML via OLRC

If in any operating year the net income of a project insured under this subchapter is less than the aggregate of the minimum annual amortization charge and the insured annual return, the Secretary, upon submission by the investor of a claim for the payment of the amount of the difference between such net income and the aggregate of the minimum annual amortization charge and the insured annual return and after proof of the validity of such claim, shall pay to the investor, in cash from the General Insurance Fund, the amount of such difference, as determined by the Secretary, but not exceeding, in any event, an amount equal to the aggregate of the minimum annual amortization charge and the insured annual return. Nothing contained in this subchapter or any other provision of law shall be construed as preventing or restricting an investor from assigning, pledging, or otherwise transferring or disposing of, subject to rules and regulations of the Secretary, any or all rights, claims, or other benefits under any insurance contract made pursuant to this subchapter to an assignee, pledgee, or other transferee, including the holders (or the trustee for such holders) of any debentures issued by the investor in connection with the project to which such insurance contract relates, and the Secretary is authorized to pay claims or issue debentures in accordance with the provisions of this section and section 1747g of this title to any such assignee, pledgee, or other transferee.

Notes & Related Subsidiaries

Editorial Notes

References in Text

The General Insurance Fund, referred to in text, was established by section 1735c of this title.

Amendments

1967—Pub. L. 90–19 substituted “Secretary” for “Commissioner” wherever appearing. 1965—Pub. L. 89–117 substituted “General Insurance Fund” for “Housing Investment Insurance Fund”. 1951—Act Sept. 1, 1951, inserted second sentence. 1950—Act Apr. 20, 1950, substituted “Commissioner” for “Administrator” wherever appearing.

§1747f Payment of claims; assignment of benefits by investors