Current through Register Vol. 48, No. 12, March 22, 2024
a) The Authority or its designee shall
purchase Mortgage Loans on the terms and conditions and in the manner
prescribed in the Mortgage Purchase Agreement. The Mortgage Purchase Agreement
shall contain such warranties of the Lender in connection with the Mortgage
Loans to be sold under the Mortgage Purchase Agreement as the Authority or its
designee shall require. These warranties shall include, but are not limited to,
the following:
1) The mortgagor is an
Eligible Borrower;
2) The original
principal amount of the Mortgage Loan does not exceed any maximum loan amount
established by the Authority;
3)
The Mortgage Loan is evidenced by a properly executed Note made payable or
assigned to the order of the Lender, endorsed by the Lender to the Authority or
its designee and secured by a Mortgage on the Qualified Dwelling; both the Note
and the Mortgage are the legal, valid and binding obligations of the makers and
mortgagors and are enforceable in accordance with their terms, unless
enforcement is limited by laws affecting the enforcement of creditors' rights
generally, if all parties to each Mortgage Loan had full legal capacity to
execute all Mortgage Loan documents at the time of execution;
4) The Mortgage, the Uniform Commercial Code
Form 1 and Form 2 financing statements, if any, and any other document required
to be filed in a public office to perfect the mortgage lien against third
parties have been duly and timely filed, registered or recorded by the Lender
in the proper public office in order to give constructive notice of them to all
subsequent purchasers or encumbrancers;
5) The Lender is the sole owner and holder of
the Mortgage Loan, has full right to sell and assign the Mortgage Loan to the
Authority or its designee, and that assignment conveys a good and marketable
mortgagee's title to the Authority or its designee free and clear of all liens
and encumbrances and subject only to real property taxes and assessments not
yet due and encumbrances customarily accepted in accordance with applicable
title standards and disclosed to the Authority or its designee prior to
purchase of the Mortgage Loan;
6)
The Mortgage creates a valid and existing first Mortgage lien on the Qualified
Dwelling to secure the Mortgage Loan, unless otherwise authorized by the
Authority or its designee; the term "first Mortgage lien" means classes of
first liens commonly given to secure loans on real estate under the laws of the
State;
7) The Lender has not
modified in any respect and has not satisfied, canceled, subordinated or
compromised in whole or in part the Mortgage Loan indebtedness, and has not
released the mortgaged property in whole or in part from the lien of the
indebtedness evidenced by the Note and secured by the Mortgage; and the terms,
covenants and conditions of the Note evidencing the Mortgage Loan and the
Mortgage securing the Mortgage Loan shall not have been waived, altered or
modified in any respect that would materially affect the validity or
enforceability of the Note or the Mortgage Loan or the security of the lien of
the Mortgage;
8) The real property
securing the Mortgage Loan is a Qualified Dwelling;
9) The Qualified Dwelling is covered by a
valid and existing policy of homeowner's property and casualty insurance
meeting the requirements of the Authority or its designee;
10) The Lender has complied with the rules
and requirements of the applicable insurance program, so that the Mortgage
Loans to be purchased are Insured and the insurance is in full force and effect
and inures to the benefit of the Authority or its designee;
11) The Mortgage Loan is covered by a fully
paid mortgagee's title insurance policy in such form as the Authority or its
designee may require and under which the Authority or its designee is a loss
payee; and
12) To the best of
Lender's information, knowledge and belief, no condition exists that would
prohibit the purchase of the Mortgage Loan by the Authority or its designee
under all applicable rules, regulations and contractual provisions.
b) The Mortgage Purchase Agreement
shall provide that the Authority shall have the right to require the Lender to
repurchase Mortgage Loans sold to the Authority or its designee by the Lender
if the Director, Deputy Director or Assistant Director determines that the
Lender has failed to comply with the requirements of either this Part or its
contracts and agreements with the Authority under the Program.
c) The Authority may provide assistance with
closing costs or a down payment to the Eligible Borrower under any such
Mortgage Loan. Assistance with closing costs and assistance with a down payment
shall be in such maximum amounts and under such terms as have been approved by
the Members from time to time by resolution.