(a)Reason for termination. The happening of any of the following events shall constitute an additional reason for terminating the contract of insurance in cases where the mortga- gee has elected to convey the property to the Commissioner:
(1) The acquisition by the mortgagee of the mortgaged property without conveying it to the Commissioner.
(2) The acquisition of the property at the foreclosure sale by a party other than the mortgagee.
(3) The redemption of the property after foreclosure.
(4) Notice given by the mortgagee after the foreclosure and during the redemption period that it will not tender the property to the Commissioner.
(b)Notice of termination. No contract of insurance shall be terminated until the mortgagee has given written notice thereof to the Commissioner within 30 days from the happening of any one of the events set forth in paragraph (a) of this section.
(c)Effective termination date. The Commissioner shall notify the mortgagee that the contract of insurance has been terminated and the effective termination date. The termination shall be effective as of the date any one of the events set forth in paragraph (a) of this section occur.
(d)Effect of termination. Upon termination of the contract of insurance the obligation to pay any subsequent MIP shall cease and all rights of the mortgagor and mortgagee shall be terminated.
[36 FR 24537, Dec. 22, 1971, as amended at 37 FR 8662, Apr. 29, 1972]
Title 24 published on 2013-04-01
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