§4114 Permissible prepayment or voluntary termination and modification of commitments

Summary

An owner can end the low-income affordability rules by prepaying the mortgage or by voluntary termination, but the owner must follow the rules in section 4113. This is allowed if the Secretary approved a plan to help the owner but did not deliver the approved help in the time required. That includes a plan under section 4109 where no help came within 15 months of approval. It also includes plans under sections 4110 or 4111 where the help was not provided before the earlier of (a) the 2-month period that starts at the beginning of the first fiscal year after approval, or (b) either 6 months or 9 months after approval depending on the situation. An owner who tried to sell to a qualified buyer, followed the sale rules, and got no real offers in the allowed time can also end the restrictions. When rental assistance under 42 U.S.C. 1437f is involved, the Secretary may sign a contract, if money may be available later, to extend that assistance so the approved plan can work. The contract must say that if the Secretary cannot extend the assistance or cannot create a similar incentive package, then at the owner’s request the Secretary will, subject to limits, change the binding commitments tied to that assistance (per section 4112(a)(2)) and allow the owner to prepay and end the plan and related use agreements—only if the owner agrees in writing to follow section 4113.