7TTH CONG., 3D SESS.--CH. 13-FEB. 3, 1938 the cash adjustment hereinafter provided, issue to the mortgagee debentures having a total face value equal to the value of the mort- gage and a certificate of claim, as hereinafter provided. For the purposes of this subsection, the value of the mortgage shall be determined, in accordance with rules and regulations prescribed by the Administrator, by adding to the amount of the original principal obligation of the mortgage which was unpaid on the date of the institution of foreclosure proceedings, or on the date of the acquisi- tion of the property after default other than by foreclosure, the amount of all payments which have been made by the mortgagee for taxes, special assessments, water rates, which are liens prior to the mortgage, insurance on the property mortgaged, and any mortgage insurance premiums paid after either of such dates, and by deducting from such total amount any amount received on account of the mortgage after either of such dates, and any amount received as rent or other income from the property, less reasonable expenses incurred in handling the property, after either of such dates: Pro- vided, That with respect to mortgages which are accepted for insurance prior to July 1, 1939, under section 203 (b) (2) (B) of this Act, and which are foreclosed before there shall have been paid on account of the principal obligation of the mortgage a sum equal to 10 per centum of the appraised value of the property as of the date the mortgage was accepted for insurance, there may be included in the debentures issued by the Administrator, on account of foreclosure costs actually paid by the mortgagee and approved by the Administrator an amount not in excess of 2 per centum of the unpaid principal of the mortgage as of the date of the institution of foreclosure proceedings, but in no event in excess of $75. "(b) The Administrator may at any time, under such terms and conditions as he may prescribe, consent to the release of the mort- gagor from his liability under the mortgage or the credit instrument secured thereby, or consent to the release of parts of the mortgaged property from the lien of the mortgage. "(c) Debentures issued under this section shall be in such form and denominations in multiples of $50, shall be subject to such terms and conditions, and shall include such provisions for redemp- tion, if any, as may be prescribed by the Administrator with the approval of the Secretary of the Treasury, and may be in coupon or registered form. Any difference between the value of the mort- gage determined as herein provided and the aggregate face value of the debentures issued, not to exceed $50, shall be adjusted by the payment of cash by the Administrator to the mortgagee from the Fund as to mortgages insured under section 203 and from the Housing Fund as to mortgages insured under section 210. "(d) The debentures issued under this section to any mortagee I with respect to mortgages insured under section 203 shall be executed in the name of the Mutual Mortgage Insurance Fund as obligor, shall be signed by the Administrator by either his written or engraved signa- ture, and shall be negotiable and the debentures issued under this section to any mortgagee with respect to mortgages insured under section 210 shall be executed in the name of the Housing Insurance Fund as obligor, shall be signed by the Administrator by either his written or engraved signature, and shall be negotiable. All such debentures shall be dated as of the date foreclosure proceedings were instituted, or the property was otherwise acquired by the mortgagee after default, and shall bear interest from such date at a rate deter- mined by the Administrator, with the approval of the Secretary of the Treasury, at the time the mortgage was offered for insurance, but not to So in original. Issuance of deben- tures and certificate of claim to mortgagee. Determination of value of mortgage. Proviso. Foreclosed mort- gages on single-family properties. Ante, p. 10 . Inclusion of foreclo- sure costs in deben- tures; maximum amount. Release of liability of mortgagor under mortgage, etc. Debentures,issuance in multiples of $50, etc. Redemption provi- sions. Ante, p. 10; post, p. 22. Execution in name of Mutual Mortgage Insurance Fund as obligor. Execution in name of Housing Insurance Fund as obligor. Date and interest rate. 52 STAT.] 13
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