38 CFR 36.4310 - Amortization.

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There is 1 rule appearing in the Federal Register for 38 CFR 36. View below or at eCFR (GPOAccess)
§ 36.4310 Amortization.
(a) All loans, the maturity date of which is beyond 5 years from date of loan or date of assumption by the veteran, shall be amortized. Except as provided in paragraph (e) of this section, the schedule of payments thereon shall be in accordance with any generally recognized plan of amortization requiring approximately equal periodic payments and shall require a principal reduction not less often than annually during the life of the loan. The final installment on any loan shall not be in excess of two times the average of the preceding installments, except that on a construction loan such installment may be for an amount not in excess of 5 percent of the original principal amount of the loan. The limitations imposed herein on the amount of the final installment shall not apply in the case of any loan extended pursuant to § 36.4315.
(b) Any plan of repayment on loans required to be amortized which does not provide for approximately equal periodic payments shall not be eligible unless the plan conforms with the provisions of paragraph (e) of this section, or is otherwise approved by the Secretary.
(c) Every guaranteed or insured loan shall be repayable within the estimated economic life of the property securing the loan.
(d) Subject to paragraph (a) of this section, any amounts which under the terms of a loan do not become due and payable on or before the last maturity date permissible for loans of its class under the limitations contained in 38 U.S.C. chapter 37 shall automatically fall due on such date. See§ 36.4337.
(e) A graduated payment mortgage loan, providing for deferrals of interest during the first 5 years of the loan and addition of the deferred amounts to principal shall be eligible, Provided:
(1) The loan is for the purpose of acquiring a single-family dwelling unit, including a condominium unit or simultaneously acquiring and improving a previously occupied, existing single-family dwelling unit.
(2)
(i) For proposed construction or existing homes not previously occupied (new homes), the maximum loan amount cannot exceed 97.5 percent of the lesser of the reasonable value of the property as of the time the loan is made or the purchase price.
(ii) For previously occupied, existing homes the maximum loan amount must be computed to assure that the principal amount of the loan, including all interest scheduled to be deferred and added to the loan principal, will not exceed the purchase price or reasonable value of the property, whichever is less, as of the time the loan is made;
(3) The increases in the monthly periodic payment amount occur annually on each of the first five annual anniversary dates of the first loan installment due date, at a rate of 7.5 percent over the preceding year's monthly payment amount;
(4) Beginning with the payment due on the fifth annual anniversary date of the first loan installment due date, all remaining monthly periodic payments are approximately equal in amount and amortize the loan fully in accordance with the requirements of this section, and
(5) The plan is otherwise acceptable to the Secretary.
(Authority: 38 U.S.C. 3703(d))
[73 FR 6310, Feb. 1, 2008. Redesignated at 75 FR 33705, June 15, 2010, as amended at 75 FR 65238, Oct. 22, 2010]

Title 38 published on 2013-07-01

The following are only the Rules published in the Federal Register after the published date of Title 38.

For a complete list of all Rules, Proposed Rules, and Notices view the Rulemaking tab.

  • 2014-01-13; vol. 79 # 8 - Monday, January 13, 2014
    1. 79 FR 2100 - Loan Guaranty: Minimum Property and Construction Requirements
      GPO FDSys XML | Text
      DEPARTMENT OF VETERANS AFFAIRS
      Final rule.
      Effective Date: This rule is effective February 12, 2014.
      38 CFR Part 36

Title 38 published on 2013-07-01

The following are ALL rules, proposed rules, and notices (chronologically) published in the Federal Register relating to 38 CFR 36 after this date.

  • 2014-01-13; vol. 79 # 8 - Monday, January 13, 2014
    1. 79 FR 2100 - Loan Guaranty: Minimum Property and Construction Requirements
      GPO FDSys XML | Text
      DEPARTMENT OF VETERANS AFFAIRS
      Final rule.
      Effective Date: This rule is effective February 12, 2014.
      38 CFR Part 36