Or. Admin. Code § 123-021-3600 - Insurance Premiums
(1) The
Department shall charge a one-time, up-front, insurance premium for each loan
insured under a Lender Agreement pursuant to a Loan Insurance Authorization.
The premium is due within 30 days of the date that the Department and the
Financial Institution execute a Loan Insurance Authorization under the
applicable Lender Agreement. The Department's insurance is not effective until
the premium is paid. Premiums, expressed as a percentage of the Department's
maximum liability, shall be charged in accordance with the schedule made
available by the Department.
(2)
Insurance premiums for each insurance program, including examples of how those
premiums are calculated, are as follows:
(a)
The premium for Conventional Insurance, with a maximum term of 10 years, shall
be 2.5% of the insured portion of the loan. As an example, the premium due on a
$1,000,000, ten-year loan with 80% Conventional Insurance is $20,000
($1,000,000 x 0.80 x 0.025).
(b)
The premium for Collateral Support Insurance, with a maximum term of 5 years,
shall be 5.0% of the insured portion of the loan. As an example, the premium
for a $1,000,000 five-year loan with 20% Collateral Support Insurance is
$10,000 ($1,000,000 x 0.20 x 0.05).
(c) The premium for Evergreen Insurance, with
a maximum term of 1 year, shall be 2.0% of the insured portion of the line of
credit. The premium is calculated as the product of the Department's maximum
liability multiplied by the maximum principal amount available to the Borrower
under the subject line of credit, regardless of whether or not the line of
credit is fully drawn down. As an example, the premium for a $1,000,000 loan
with 80% Evergreen Insurance is $16,000 ($1,000,000 x 0.80 x 0.02); this amount
would be due every year thereafter for up to four additional years, assuming
that the loan is renewed each year for the maximum term permitted under the
Evergreen Entrants Program (5 years).
(d) The premium for Construction Loan
Insurance, with a minimum term of one year, shall be 1.75% of the insured
portion of the loan. For each additional one year of Construction Loan
Insurance approved by the Department the additional non-prorated premium shall
be of 0.75% of the insured portion of the construction loan. A one-time,
additional twelve-month extension may be granted for 1.0% of the insured
portion of the loan.
(A) Example 1: The
premium for a $1,000,000 12-month loan with 80% Construction Loan Insurance is
$14,000 ($1,000,000 x 0.80 x 0.0175).
(B) Example 2: The premium for a $1,000,000
30-month loan with 80% Construction Loan Insurance is $26,000 ($1,000,000 x
0.80 x 0.0325).
(C) Example 3: The
premium for a $1,000,000 9-month loan extension with 80% Construction Loan
Insurance is $8,000 ($1,000,000 x 0.80 x 0.01).
(3) In its sole discretion, the Department
may charge an additional fee for changes to an insured loan that requires
modifying an existing Loan Insurance Authorization. This fee may be up to one
half of the amount of the insurance premium charged at loan
origination.
Notes
Statutory/Other Authority: ORS 285A.075 & 285B.200 - 285B.218
Statutes/Other Implemented: ORS 285B.200 - 285B.218
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