[Code of Federal Regulations]
[Title 24, Volume 4]
[Revised as of April 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 24CFR883.307]

[Page 105-106]
 
                 TITLE 24--HOUSING AND URBAN DEVELOPMENT
 
  CHAPTER VIII--OFFICE OF THE ASSISTANT SECRETARY FOR HOUSING-FEDERAL 
 
PART 883--SECTION 8 HOUSING ASSISTANCE PAYMENTS PROGRAM--STATE HOUSING AGENCIES--Table of Contents
 
              Subpart C--Definitions and Other Requirements
 
Sec. 883.307  Financing.

    (a) Types of financing. A State Agency that used the Fast Track 
Procedures formerly in this part must provide permanent financing for 
any new construction or substantial rehabilitation project without 
Federal mortgage insurance, except coinsurance under section 244 under 
the National Housing Act (12 U.S.C. 1701 et seq). Obligations issued by 
the HFA for this purpose may be taxable under section 802 of the Housing 
and Community Development Act of 1974 (42 U.S.C. 1440) or tax-exempt 
under section 103 of the Internal Revenue Code (26 U.S.C. 103), 24 CFR 
part 811 or other Federal Law.
    (b) HUD approval. (1) A State Agency, prior to receiving HUD 
approval of its first New Construction or Substantial Rehabilitation 
Proposal using contract authority under this part, must submit copies of 
the documents relating to the method of financing Section 8 projects to 
HUD for review. These documents shall include bond resolutions or 
indentures, loan agreements, regulatory agreements, notes, mortgages or 
deeds of trust and other related documents, if any, but does not need to 
include the ``official statement'' or copies of the prospectus for 
individual bond issues. HUD review will be limited to making certain 
that the documents are not inconsistent with or in violation of these 
regulations and the administrative procedures used to implement them. 
After review, HUD must notify the Agency that the documents are 
acceptable or,

[[Page 106]]

if unacceptable, will request clarification or changes. This review and 
approval will meet the requirements of 24 CFR 811.107(a).
    (2) When an Agency which has received HUD approval of its financing 
documents proposes substantive changes in them which affect the Section 
8 program, the revised documents must be submitted for review. HUD 
review will be limited to the areas indicated in paragraph (b)(1) of 
this section and must be carried out promptly. HUD will notify the 
Agency that the revised documents are acceptable, or, if unacceptable, 
will request clarification or changes.
    (3) The review and approval of financing documents required under 24 
CFR part 811 will constitute HUD approval under this section.
    (4) The Agency must retain in its files, and make available for HUD 
inspection, the documentation relating to its financing of Section 8 
projects, including any relating to the certifications of compliance 
with applicable Department of Treasury or HUD regulations (24 CFR part 
811) regarding tax-exempt financing.
    (c) Pledge of Contracts. The HFA or owner may pledge, or offer as 
security for any loan or obligation, an Agreement, Contract, or ACC 
entered into pursuant this part provided that such security is in 
connection with a project constructed pursuant to this part. Any pledge 
of the Agreement, Contract, or ACC, or payments thereunder will be 
limited to the amounts payable under the Contract or ACC in accordance 
with its terms. If the pledge or other document provides that all 
payments will be paid directly to the HFA, other mortgagee or the 
trustee for bondholders, the HFA, other mortgagee or trustee may make 
all payments or deposits required under the mortgage or trust indenture 
and remit any excess to the owner.
    (d) Foreclosure and other transfers. In the event of assignment, 
sale, or other disposition of the project or the contracts agreed to by 
the HFA and approved by HUD (which approval shall not be unreasonably 
delayed or withheld), foreclosure, or assignment of the mortgage or deed 
in lieu of foreclosure,
    (1) The Agreement, the Contract and the ACC will continue in effect, 
and
    (2) Housing assistance payments will continue in accordance with the 
terms of the Contract, unless approval to amend or terminate the 
Agreement, the Contract or the ACC has been obtained from the Assistant 
Secretary.
    (e) In the case of a newly constructed or substantially 
rehabilitated manufactured home park, the principal amount of any 
mortgage attributable to the rental spaces in the park may not exceed an 
amount per space determined in accordance with Sec. 207.33(b) of this 
title.

[45 FR 6889, Jan. 30, 1980, as amended at 45 FR 56327, Aug. 22, 1980; 48 
FR 12709, Mar. 28, 1983; 49 FR 17449, Apr. 24, 1984; 61 FR 13592, Mar. 
27, 1996]