Ill. Admin. Code tit. 47, § 260.403 - Terms and Conditions of the Purchase of Mortgage Loans
a) The Authority or its designee shall
purchase Mortgage Loans on the terms and conditions and in the manner
prescribed in the Mortgage Purchase Agreement. The Mortgage Purchase Agreement
shall contain such warranties of the Lender in connection with the Mortgage
Loans to be sold under the Mortgage Purchase Agreement as the Authority or its
designee shall require. These warrantees shall include, but are not limited to,
the following:
1) The mortgagor is an
Eligible Borrower;
2) The purchase
price of the Qualified Dwelling subject to the Mortgage Loan does not exceed
any maximum purchase price limitations established by the Authority ;
3) The Mortgage Loan is evidenced by a
properly executed promissory note made payable or assigned to the order of the
Lender , endorsed by the Lender to the Authority or its designee and secured by
a Mortgage on the Qualified Dwelling; both the note and the Mortgage are the
legal, valid and binding obligations of the makers and mortgagors and are
enforceable in accordance with their terms, unless enforcement is limited by
laws affecting the enforcement of creditors' rights generally, if all parties
to each Mortgage Loan had full legal capacity to execute all Mortgage Loan
documents at the time of execution;
4) The Mortgage , the Uniform Commercial Code
Form 1 and Form 2 financing statements, if any, and any other document required
to be filed in a public office to perfect the mortgage lien against third
parties have been duly and timely filed, registered or recorded by the Lender
in the proper public office in order to give constructive notice of them to all
subsequent purchasers or encumbrancers;
5) The Lender , being the sole owner and
holder of the Mortgage Loan, has full right to sell and assign the Mortgage
Loan to the Authority or its designee and that assignment conveys a good and
marketable mortgagee's title to the Authority or its designee free and clear of
all liens and encumbrances and subject only to real property taxes and
assessments not yet due and encumbrances customarily accepted in accordance
with applicable title standards and disclosed to the Authority or its designee
prior to purchase of the Mortgage Loan;
6) The Mortgage creates a valid and existing
first mortgage lien on the Qualified Dwelling to secure the Mortgage Loan,
unless otherwise authorized by the Authority or its designee; the term "first
mortgage lien" means classes of first liens commonly given to secure loans on
real estate under the laws of the State;
7) The Lender has not modified in any respect
and has not satisfied, canceled, subordinated or compromised in whole or in
part the Mortgage Loan indebtedness, and has not released the mortgaged
property in whole or in part from the lien of the indebtedness evidenced by the
note and secured by the Mortgage; and the terms, covenants and conditions of
the note evidencing the Mortgage Loan and the Mortgage securing the Mortgage
Loan shall not have been waived, altered or modified in any respect that would
materially affect the validity or enforceability of the Mortgage Loan or the
security of the lien of the Mortgage;
8) The real property securing the Mortgage
Loan is a Qualified Dwelling;
9)
The Qualified Dwelling is covered by a valid and existing policy of homeowner's
property and casualty insurance meeting the requirements of the Authority or
its designee;
10) The Lender has
complied as follows:
A) as to each
FHA-insured Mortgage Loan, with the National Housing Act (
12
USC 1701 et seq.) as amended and
supplemented, all rules and regulations issued under the National Housing Act
and all administrative publications. The FHA insurance shall be in full force
and effect and, upon purchase by the Authority or its designee of the Mortgage
Loan, shall inure to the benefit of the Authority or its designee;
B) as to each Mortgage Loan guaranteed by the
VA or FmHA, with the Servicemen's Readjustment Act (
38
USC 1803 et seq.), the Consolidated Farm and
Rural Development Act (
7 USC 1921
et seq.), Title V of the Housing Act of 1949 (
42 USC
1471 -
1482 ) or other
applicable federal law, as amended and supplemented, all rules and regulations
issued under those laws and all administrative publications. Any such guaranty
shall be in full force and effect and, upon purchase by the Authority or its
designee of the Mortgage Loan, shall inure to the benefit of the Authority or
its designee; and
C) as to each
Mortgage Loan insured by a private mortgage insurance company, with all rules
and requirements of that company. Any such insurance shall be in full force and
effect and, upon purchase by the Authority or its designee of the Mortgage
Loan, shall inure to the benefit of the Authority or its designee;
11) The Mortgage Loan is covered
by a fully paid mortgagee's title insurance policy in such form as the
Authority or its designee may require and under which the Authority or its
designee is a loss payee; and
12)
To the best of Lender 's information, knowledge and belief, no condition exists
that would prohibit the purchase of the Mortgage Loan by the Authority or its
designee under all applicable rules, regulations and contractual
provisions.
b) The
Mortgage Purchase Agreement shall provide that the Authority shall have the
right to require the Lender to repurchase Mortgage Loans sold to the Authority
or its designee by the Lender if the Director, Deputy Director, Assistant
Director or Managing Director determines that the Lender has failed to comply
with the requirements of either this Part or its contracts and agreements with
the Authority under the Program.
Notes
Amended at 33 Ill. Reg. 7295, effective May 22, 2009
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