[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: 24CFR904.101]

[Page 296-297]
 
                 TITLE 24--HOUSING AND URBAN DEVELOPMENT
 
CHAPTER IX--OFFICE OF ASSISTANT SECRETARY FOR PUBLIC AND INDIAN HOUSING, 
               DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
 
PART 904--LOW RENT HOUSING HOMEOWNERSHIP OPPORTUNITIES--Table of Contents
 
               Subpart B--Turnkey III Program Description
 
Sec. 904.101  Introduction.


    (a) Purpose. This subpart sets forth the essential elements of the 
HUD Homeownership Opportunities Program for Low-Income Families (Turnkey 
III).
    (b) Applicability. This subpart is applicable to Turnkey III 
developments operated by LHA. For Turnkey III developments operated by 
an Indian

[[Page 297]]

Housing Authority, applicable provisions are found at 24 CFR part 905, 
subpart G.
    (1) With respect to any development to be operated as Turnkey III, 
the Annual Contributions Contract (ACC) shall contain the ``Special 
Provisions for Turnkey III Homeownership Opportunity Project'' as set 
forth in Appendix I. A Turnkey III development may include only units 
which are to be operated as such under Homebuyers Ownership Opportunity 
Agreements. If for any reason it is determined that certain units should 
be operated as conventional rental units, such units must comprise or be 
made part of a conventional rental project.
    (2) With respect to Turnkey III developments pursuant to an executed 
ACC where no Agreements with Homebuyers have been signed, the ACC shall 
be amended (i) to include the ``Special Provisions'' set forth in 
Appendix I, (ii) to extend its term to 30 years, and (iii) to reduce its 
Maximum Contribution Percentage to a rate that will amortize the debt in 
30 years at the minimum Loan Interest Rate specified in the ACC for the 
specific Turnkey III project involved. Further development and operation 
shall be in accordance with this subpart including use of the form of 
Homebuyers Ownership Opportunity Agreement set forth in Appendix II.
    (3) With respect to developments where Agreements with homebuyers 
have been signed, the following steps shall be taken:
    (i) The ACC shall be amended to include the Special Provisions'' set 
forth in Appendix I; further development and operation of the Project 
shall be in accordance with this subpart.
    (ii) The LHA shall offer all qualified homebuyers in the development 
a new Homebuyers Ownership Opportunity Agreement as set forth in 
Appendix II with an amendment to section 16a to refer to ``the latest 
approved Development Cost Budget, or Actual Development Cost Certificate 
if issued,'' in lieu of ``the Development Cost Budget in effect upon 
award of the Main Construction Contract or execution of the Contract of 
Sale,'' and, if the ACC for the Project has a term of 25 years, an 
amendment to section 16(b) to refer to a term of 25 years, instead of 
30, for the Purchase Price Schedule. Each Purchase Price Schedule shall 
commence with the first day of the month following the effective date of 
the initial Agreement. No other modification in the new Agreement may be 
made. In the event the homebuyer refuses to accept the new Agreement, no 
modifications may be made in the old Agreement and the matter shall be 
referred to HUD.
    (4) With respect to Projects which were under ACC on the effective 
date of this subpart, the Total Development Cost Budget shall be 
revised, if financially feasible, to include the cost of the appraisals 
which are necessary for computation of the initial purchase prices 
pursuant to Sec. 904.113. In the event this is not financially feasible, 
the matter shall be referred to HUD, which may, if necessary, authorize 
a different method for computation of such initial purchase prices on an 
equitable basis.
    (5) With respect to all developments which were completed by the 
effective date of this subpart, the appraisals which are necessary for 
computation of the initial purchase prices pursuant to Sec. 904.113 
shall be made as of the date of completion of the development.

[39 FR 10966, Mar. 22, 1974. Redesignated at 40 FR 15580, Apr. 7, 1975, 
and 49 FR 6714, Feb. 23, 1984, and amended at 56 FR 922, Jan. 9, 1991]