Middle and Low Income Housing Act

Summary

Middle and Low Income Housing Act - Directs the Secretary of Housing and Urban Development to assist in the production of adequate housing for middle-income and elderly families by making mortgage loans to qualified borrowers and by purchasing or repurchasing loans to finance the development of a housing project to be undertaken by a qualified borrower. Defines an eligible borrower as any public body, cooperative ownership housing corporation, limited dividend corporation, private nonprofit corporation or any private corporation, borrowing directly in a commitment from the Secretary and authorized to provide dwellings, the occupancy of which is to be permitted in consideration of agreed charges, or for sale at cost plus no more than six percent. Provides that the Secretary shall not make any loans until he has determined that the borrower is eligible and that the housing will be predominantly available to middle-income and elderly families; the housing project will meet an existing need for housing of these families; the location of the project will afford reasonable assurances as to the neighborhood's stability and the dwellings will meet sound standards of construction and design; and economies in construction, operation and maintenance will be used. Directs the borrower to (A.) charge only reasonable fees that will be within the range of elderly and middle income families and that will not return a profit of over six percent; (B.) give preference to: (1) families displaced by urban renewal; (2) families in substandard housing and (3) families in overcrowded homes and Veterans are to have preference in each category; (C.) maintain the project in good condition during the life of the mortgage loan; and (D.) if a corporation, to pay dividends. Provides that in the case of a cooperative ownership housing corporation the members at the time of application for the loan must be equal to 30 percent of the total number of members to be served by the project, and that, prior to the receipt of any proceeds of the loan, the members of the cooperative borrower must be equal to 80 percent of the number of members to be served. Limits loans to 90 percent of the development cost of the housing project and to 90 percent of such amount as the Secretary shall have determined to be the maximum within which the project must be constructed in order that it may be made available for middle income families at rentals or charges within their means. Provides for the amortization of the loan over a 50 year period with a 60 year period permitted if the loan must be refinanced at a higher interest rate. Permits an interest rate of one-half of one percent on the principal for overhead cost. Allows the borrower to relieve himself of supervision by the Secretary by repayment of the loan after 20 years. Authorizes the Secretary in order to assist in the improvement and repair of housing for elderly and middle income families, to make home improvement loans to eligible borrowers. Directs that these loans shall involve a principal obligation not exceeding the total cost as determined by the Secretary and not exceeding such amount determined to be the maximum within which the improvement must be done in order that the housing may be available for elderly and middle income families, and not exceeding a specified dollar amount. Allows an amortization period of forty years or three-quarters of the remaining economic life of the structure. Permits this to be extended to 50 years if an increase in interest rate is necessitated by refinancing the loan. Provides that the Secretary may charge the applicant for a home improvement loan reasonable fees for overhead expenses. Provides for the keeping of records by the borrower and for an audit by the Secretary and Comptroller General. Authorizes the Secretary to permit State control of this program if he finds that a State program already exists that is similar to the Federal program. Limits the amount of home improvement loans to one-fourth of the amount appropriated for loans under this Act. Creates a revolving fund in the Treasury for the purpose of financing the provisions of this Act. Directs the Secretary to create a specific reserve account for losses, to be known as the Insurance fund. Provides that applications for assistance for projects receiving State or local government aid shall be given priority. Requires that wages on projects be commensurate with the prevailing wage rate for the area. Applies existing Federal law on kickbacks to public employees to projects financed under this Act. Provides that violations of the provisions of this Act shall be punishable by a fine of not more than $5,000, or imprisonment of not more than a year or both.

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1 official file

• Introduced in House

  summary · EN · 15 May 1973

  Open at official source

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