the amount the mortgagee may have paid for (A) taxes, special assess-
ments, and water rates, which are liens prior to the mortgage; (B)
insurance on the property; and (C) reasonable expenses for the com-
pletion and preservation of the property and any mortgage insurance
premiums paid after default; less the sum of (i) an amount equivalent
to 1 per centum of the unpaid amount of such principal obligation on
the date of default; (ii) any amount received on account of the mort-
gage after such date; and (iii) any net income received by the mort-
Foreclosure; insur- gagee from the property after such date: Provided, That the mort-
ance benefits.
gagee in the event of a default under the mortgage may, at its option
and in accordance with regulations of, and in a period to be determined
by the Commissioner, proceed to foreclose on and obtain possession
of or otherwise acquire such property from the mortgagor after
default, and receive the benefits of the insurance as hereinafter pro-
vided, upon (1) the prompt conveyance to the Commissioner of title
to the property which meets the requirements of the rules and regula-
tions of the Commissioner in force at the time the mortgage was
insured, and which is evidenced in the manner prescribed by such
rules and regulations; and (2) the assignment to him of all claims
of the mortgagee against the mortgagor or others, arising out of the
mortgage transaction or foreclosure proceedings, except such claims
that may have been released with the consent of the Commissioner.
Upon such conveyance and assignment, the obligation of the mortgagee
to pay the premium charges for insurance shall cease and the mort-
gagee shall be entitled to receive the benefits of the insurance as pro-
vided in this subsection, except that in such event the 1 per centum
Acquisitionofmort- deduction, set out in (i) hereof, shall not apply. If, during the time
v.gs.
the mortgage is insured and before the mortgagee has received the
benefits of the insurance, the United States acquires, or commences
eminent domain proceedings to acquire, all or a substantial part (as
defined by the Commissioner) of the mortgaged property for the use
of the National Military Establishment, the mortgagee may, at its
election, within such time and in accordance with such regulations
as the Commissioner may prescribe, receive the benefits of the insur-
ance as provided in this subsection, notwithstanding the fact that the
mortgage may not be in default.
Debentures.
"(e) Debentures issued under this title 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 redemption, if any,
as may be prescribed by the Commissioner with the approval of the
Secretary of the Treasury, and may be in coupon or registered form.
Any difference between the value of the mortgage 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
Commissioner to the mortgagee from the Military Housing Insurance
Fund.
Execution or deben-
"(f) Debentures issued under this title shall be executed in the name
trs.
of the Military Housing Insurance Fund as obligor, shall be signed
by the Commissioner, by either his written or engraved signature,
and shall be negotiable. All such debentures shall be dated as of the
date of default as determined in accordance with subsection (d) of
this section, and shall bear interest from such date at a rate deter-
mined by the Commissioner with the approval of the Secretary of the
Treasury, at the time the mortgage was accepted for insurance, but
not to exceed 3 per centum per annum, payable semiannually on the
Maturity.
1st day of January and the 1st day of July of each year, and shall
Ta exemption.
mature ten years after the date thereof. Such debentures shall be
exempt, both as to principal and interest, from all taxation (except
surtaxes, estate, inheritance, and gift taxes) now or hereafter imposed
574
PUBLIC LAWS-CH. 403 -AUG. 8, 1949
[63 STAT.
�
