An Act to amend title III of the Servicemens Readjustment Act of 1944, as amended, and for other purposes.
PL 84-898 (H.R.9260), enacted 08/01/1956

70 STAT.] 
PUBLIC LAW 898~AUG. 1, 1956 
913 
boundary of the Giles McNulty Indian Keservation and the north 
boundary of the Thomas Wilson Indian Reservation; thence south 83 
degrees 30 minutes east 0.12 chains to the point of beginning, and 
containing 389.99 acres, more or less, situate and being in Madison 
County, Alabama. 
Approved August 1, 1956. 
Public Law 898 
CHAPTER 854 
AN ACT 
August 1, 1956 
To amend title III of the Servicemen's Readjustment Act of 1944, as amended, 
[H. R. 9260] 
and for other purposes. 
Be it enacted hy the Senate and House of Representatives 
of the 
United States of America in Congress assembled, That title I I I of adjustme*iu*b*etiT 
the Servicemen's Readjustment Act of 1944, as amended, is hereby fits, 
amended as follows: 
59 stat. 626. 
(1) Section 500 (a) is amended (A) by striking out "ten" the first 
^s use 694. 
time it appears in the fourth sentence and inserting in lieu thereof 
"eleven", (B) by deleting the colon immediately preceding the last 
proviso and inserting in lieu thereof the following: "and, notwith-
standing any other provision of this section to the contrary, an en-
titlement may be so excluded and restored to the use of any veteran 
at any time prior to January 31, 1965, for the purpose of obtaining a 
loan w^hich will be guaranteed or insured in accordance with the pro-
visions of this title:", and (C) by adding at the end thereof the fol-
lowing : "In computing the aggregate amount of guaranty or insur-
ance entitlement available to a veteran under this title, the Adminis-
trator shall exclude the amount of guaranty or insurance entitlement 
previously used for any loan guaranteed or insured under section 501 
^s use 694a. 
which has been repaid in full, and with respect to which the real 
property which served as security for the loan has been disposed of 
because the veteran, while in the active service, was transferred by the 
military department with which he was serving." 
(2) Section 500 (c) is amended by striking the third sentence and 
^* ^^^ ^^^' 
inserting in lieu thereof: "Upon making a loan as provided herein, the 
lender shall forthwith transmit to the Administrator a report thereof 
in such detail as the Administrator may, from time to time, prescribe." 
(3) Section 501 (a) is amended by striking subsection (3) and 
38 use 694a. 
inserting in lieu thereof the following: "(3) That the price paid or to 
be paid by the veteran for such property, or for the cost of construc-
tion, repairs, or alterations, does not exceed the reasonable value 
thereof as determined by the Administrator." 
(4) Section 602 (a) is amended by striking out subsection (4) and 
38 use 694b. 
inserting in lieu thereof the following: "(4) That the price paid or to 
be paid by the veteran for such property, or for the cost of construc-
tion, repairs, or alterations, does not exceed the reasonable value 
thereof as determined by the Administrator." 
(5) Section 503 is amended by striking out subsection (4) and 
38 use 694c. 
inserting in lieu thereof the following: "(4) That the price paid or to 
be paid by the veteran for such property, or for the cost of construc-
tion, repairs, or alterations, does not exceed the reasonable value 
thereof as determined by the Administrator." 
(6) Section 503A is amended by striking out the first paragraph 
3lusc6¥4c-i. 
and inserting in lieu thereof the following: "Whoever knowingly 
makes, effects, or participates in a sale of any property to a veteran 
for a consideration in excess of the reasonable value of such property 
as determined by the Administrator, shall, if the veteran pays for such 
property in whole or in part with the proceeds of a loan guaranteed 
69225 0 - 5 7 - 6 2 (Vol. 70) 
914 
PUBLIC LAW 898-AUG. 1, 1956 
[70 ST 
A T . 
38 u s e 694a. 
694c. 
38 use 694d. 
38 use 694g. 
38 use 694h. 
38 use 694. 
by the Veterans' Administration under section 501, 502, or 503 of this 
title, be liable for three times the amount of such excess consideration 
irrespective of whether such person has received any part thereof." 
(7) Section 504 is amended by adding a new subsection (d) to read 
as follows:" (d) No loan for the purchase or construction of residential 
property shall be financed through the assistance of the provisions of 
this title unless the veteran applicant, at the time that he applies for 
the loan, and also at the time that the loan is closed, certifies, in such 
form as may be required by the Administrator, that he intends to 
occupy the property as his home. No loan for the repair, alteration, 
or improvement of residential property shall be financed through the 
assistance of the provisions of this title unless the veteran applicant, 
at the time that he applies to the lender for the loan, and also at the 
time that the loan is closed, certifies, in such form as may be required 
by the Administrator, that he occupies the property as his home. 
For 
the purpose of this title the requirement that the veteran recipient of 
a guaranteed or direct home loan must occupy or intend to occupy the 
property as his home shall be construed to mean that the veteran as of 
the date of his certification actually lives in the property personally 
as his residence or actually intends upon completion of the loan and 
acquisition of the dwelling unit to move into the property personally 
within a reasonable time and to utilize such property as his residence." 
(8) Section 506 is amended by designating the existing provisions 
therein as subsection (a) and by adding a new subsection (b) to read 
as follows: "(b) Whenever any veteran disposes of residential prop-
erty securing a guaranteed, insured, or direct loan obtained by him 
under this title, the Administrator, upon application made by such vet-
eran and by the transferee incident to such disposal, shall issue to such 
veteran in connection with such disposal a release relieving him of all 
further liability to the Administrator on account of such loan (includ-
ing liability for any loss resulting from any default of the transferee 
or any subsequent purchaser of such property) if the Administrator 
has determined, after such investigation as he may deem appropriate, 
that (1) the loan is current, and (2) the purchaser of such property 
from such veteran (a) has obligated himself by contract to purchase 
such property and to assume full liability for the repayment of the 
balance of the loan remaining unpaid, and has assumed by contract 
all of the obligations of the veteran under the terms of the instruments 
creating and securing the loan, and (b) qualifies from a credit stand-
point, to the same extent as if he were a veteran eligible under section 
501 (a), for a guaranteed or insured or direct loan in an amount equal 
to the unpaid balance of the obligation for which he has assumed 
liability." 
(9) Section 507 is amended (A) by striking out "ten" the first time 
it appears in subsection (1) and inserting in lieu thereof "eleven", and 
(B) by striking out subsection (3) and inserting in lieu thereof the 
following: "(3) The amount of the guaranteed loan does not exceed 
the reasonable value of the property or business, as determined by 
the Administrator." 
(10) Section 500 is amended by adding at the end thereof the fol-
lowing : 
"(g) Notwithstanding any other provision of this title, if a loan 
report or an application for loan guaranty relating to a loan under 
this title has been received by the Administrator on or before July 25, 
1958, such loan may be guaranteed or insured under the provisions of 
this title on or before July 25,1959." 
Approved August 1, 1956.