12 U.S. Code § 1715r - Requirement of builder’s cost certification; definitions
Except as provided in subsection (b) and notwithstanding any other provision of this chapter, no mortgage covering new or rehabilitated multifamily housing or a property or project described in subchapter IX–B shall be insured under this chapter unless the mortgagor has agreed (A) to certify, upon completion of the physical improvements on the mortgaged property or project and prior to final endorsement of the mortgage, either (i) that the approved percentage of actual cost (as those terms are herein defined) equaled or exceeded the proceeds of the mortgage loan or (ii) the amount by which the proceeds of the mortgage loan exceeded such approved percentage of actual cost, as the case may be, and (B) to pay forthwith to the mortgagee, for application to the reduction of the principal obligation of such mortgage, the amount, if any, certified to be in excess of such approved percentage of actual cost. Upon the Secretary’s approval of the mortgagor’s certification as required hereunder, such certification shall be final and incontestable, except for fraud or material misrepresentation on the part of the mortgagor.
In the case of any mortgage insured under any provision of this subchapter that is executed in connection with the construction, rehabilitation, purchase, or refinancing of a multifamily housing project for which equity  provided through any low-income housing tax credit pursuant to section 42 of title 26, if the Secretary determines at the time of issuance of the firm commitment for insurance that the ratio of the loan proceeds to the actual cost of the project is less than 80 percent, subsection (a) of this section shall not apply.
 So in original. Probably should be followed by “is”.
This chapter, referred to in subsecs. (a) and (c)(2), was in the original “this Act”, meaning act June 27, 1934, ch. 847, 48 Stat. 1246, which is classified principally to this chapter (§ 1701 et seq.). For complete classification of this Act to the Code, see Tables.
2008—Pub. L. 110–289 designated introductory provisions as subsec. (a) and inserted heading, in subsec. (a), as redesignated, substituted “Except as provided in subsection (b) and notwithstanding” for “Notwithstanding”, redesignated cls. (a) and (b) as cls. (A) and (B), respectively, and struck out “As used in this section—” at end, added subsec. (b), inserted heading and introductory provisions of subsec. (c), and designated former subsecs. (a) to (c) as pars. (1) to (3), respectively, of subsec. (c) and subcls. (1) and (2) of cls. (i) and (ii) of former subsec. (c) as subcls. (I) and (II), respectively, of cls. (i) and (ii), respectively, of par. (3) of subsec. (c).
1967—Pub. L. 90–19 substituted “Secretary” for “Commissioner” in subsecs. (b) and (c), and “Secretary’s” for “Commissioner’s” in text preceding subsec. (a) and in subsec. (c).
1966—Pub. L. 89–754, § 502(b), made the certification requirement applicable to mortgage covering property or project described in subchapter IX–B.
Subsec. (a). Pub. L. 89–754, § 1020(b), substituted “subsection (b)” for “subsection (b)(2)” in cl. (vi).
1961—Subsec. (a). Pub. L. 87–70, § 612(k)(1), included property covered by a mortgage insured or to be insured under section 1715x of this title if the mortgage meets the requirements of subsection (b)(2).
Subsec. (b). Pub. L. 87–70, § 612(k)(2), substituted “value, cost, or replacement cost” for “value or replacement cost”.
Subsec. (c). Pub. L. 87–70, § 612(k)(3), substituted “section 1715
1959—Subsec. (a). Pub. L. 86–372, § 112(a), included mortgages insured or to be insured under subsec. (d)(4) of section 1715
1956—Act Aug. 7, 1956, § 109, inserted sentence preceding subsec. (a), that upon Commissioner’s approval, certification shall be final and incontestable, except for fraud or misrepresentation by mortgagor.
Subsec. (a). Act Aug. 7, 1956, § 105(d), inserted “or with respect to any property or project of a mortgagor of the character described in paragraph (3) of subsection (a) of section 1715e of this title,” before “(iii)”.
Subsec. (b). Act Aug. 7, 1956, § 109, inserted provision that if the insured mortgage is to assist financing of repairs and no part of proceeds will be used to purchase the land or structure involved, the approved percentage shall be 100 percent.
Subsec. (c). Act Aug. 7, 1956, § 109, inserted “such allocations of general overhead items as are acceptable to the Commissioner,” after “legal expenses” wherever appearing; struck out “(without reduction by reason of the application of the approved percentage requirements of this section)” before “secured by such land and improvements,” in cl. (ii)(B), amended proviso to provide that additional amount under (B) of cl. (ii) should not exceed the approved percentage of the Commissioner’s estimate of the fair market value of the land and improvements; and inserted provisions at end relating to 10 percent allowance for builder’s profit in mortgages issued under section 1715k.
1955—Act Aug. 11, 1955, substituted “under section 1715
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