Virginia Administrative Code › Title 13 - HOUSING › Agency 10 - VIRGINIA HOUSING DEVELOPMENT AUTHORITY › Chapter 30 - RULES AND REGULATIONS FOR SINGLE FAMILY HOUSING DEVELOPMENTS › Section 13VAC10-30-80 - Mortgage loan increases

Current through Register Vol. 40, No. 24, July 15, 2024
Prior to initial closing, the principal amount of the
				  mortgage loan and/or the maximum sales prices may be increased, if such an
				  increase is justified by an increase in the estimated costs of the proposed
				  development, is necessary or desirable to effect the successful construction
				  and sale of the proposed development, can be funded (in the case of a mortgage
				  loan increase) from available moneys of the authority or proceeds of the
				  authority's notes or bonds, and is not inconsistent with the provisions of the
				  Act or these rules and regulations. Any such increase shall be subject to such
				  terms and conditions as the authority shall require.
Subsequent to initial closing, the authority will consider
				  and, where appropriate, approve an increase in the principal amount of the
				  mortgage loan and/or the maximum sales prices in the following
				  instances:
1. Where cost increases are
				incurred as the direct result of (i) changes in work required or requested by
				the authority of (ii) betterments to the development approved by the authority
				which will improve the quality or value of the development;
2. Where cost increases are incurred as a
				direct result of a failure by the authority during processing of the
				development to properly perform an act for which the authority is solely
				responsible;
3. Where an increase
				in the mortgage loan or maximum sales price is determined by the authority, in
				its sole and absolute discretion, to be in the best interests of the authority
				in protecting its security for the mortgage loan; or
4. Where the authority has entered into an
				agreement with the mortgagor prior to initial closing to provide an increase in
				the mortgage loan or maximum sales price if certain cost overruns occur in
				agreed line items, but only to the extent set forth in such agreement.
Any such increase in the mortgage loan or maximum sales price
				  subsequent to initial closing may be subject to such terms and conditions as
				  the authority shall require, including (but not limited to) one or more of the
				  following:
1. The ability of the
				authority to sell notes or bonds to finance the mortgage loan increase in
				amounts, at rates and under terms and conditions satisfactory to the authority
				(applicable only to a mortgage loan increase to be financed from the proceeds
				of the authority's notes or bonds).
2. A determination by the authority that the
				mortgage loan increase in the principal amount of the mortgage loan and/or in
				the maximum sales price will have no material adverse effect on the
				marketability of the development.
3. A determination by the authority that the
				mortgage loan, as increased, does not exceed such percentage of the total
				development cost as is established in the resolution authorizing the mortgage
				loan in accordance with
				13VAC10-30-30 hereof.
4. Such terms and conditions as the authority
				shall require in order to protect the security of its interest in the mortgage
				loan, to comply with covenants and agreements with the holders of any notes or
				bonds issued to finance the mortgage loan, to comply with the Act and these
				rules and regulations, and to carry out its public purpose.
The executive director may, at any time and without further
				  action by the board, increase (i) the principal amount of the mortgage loan by
				  an amount or amounts not to exceed 2.0% of the maximum principal amount of the
				  mortgage loan set forth in the commitment and/or (ii) the maximum sales prices
				  for the units in the developments to the highest maximum sales prices then
				  established by the authority for newly constructed units in the area in which
				  the development is located; provided that any such increase in the mortgage
				  loan or maximum sales price is consistent with the Act and these rules and
				  regulations and the provisions hereof. Any increase in excess of the foregoing
				  amounts shall require the approval of the board.
Nothing contained in this section (13VAC10-30-80 ) shall impose any
				  duty or obligation on the authority to increase any mortgage loan or maximum
				  sales price, as the decision as to whether to grant such increase shall be
				  within the sole and absolute discretion of the authority.