§ 2704. — Insurance for emergency mortgage loans and advances.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 12USC2704]
TITLE 12--BANKS AND BANKING
CHAPTER 28--EMERGENCY MORTGAGE RELIEF
Sec. 2704. Insurance for emergency mortgage loans and advances
(a) Institutions eligible
The Secretary is authorized, upon such terms and conditions as the
Secretary may prescribe, to insure banks, trust companies, finance
companies, mortgage companies, savings and loan associations, insurance
companies, credit unions, and such other financial institutions, which
the Secretary finds to be qualified by experience and facilities and
approves as eligible for insurance, against losses which they may
sustain as a result of emergency loans or advances of credit made in
accordance with the provisions of section 2703 of this title and this
section with respect to mortgages eligible for assistance under this
chapter.
(b) Amount of insurance
In no case shall the insurance granted by the Secretary under this
section to any financial institution on loans and advances made by such
financial institution for the purposes of this chapter exceed 40 per
centum of the total amount of such loans and advances made by the
institution, except that, with respect to any individual loan or advance
of credit, the amount of any claim for loss on such individual loan or
advance of credit paid by the Secretary under the provision of this
section shall not exceed 90 per centum of such loss.
(c) Premium charge; amount
The Secretary is authorized to fix a premium charge or charges for
the insurance granted under this section, but in the case of any loan or
advance of credit, such charge or charges shall not exceed an amount
equivalent to one-half of 1 per centum per annum of the principal
obligation of such loan or advance of credit outstanding at any time.
(d) Waiver of compliance with rules and regulations; finality and
incontestability of payment for loss; transfer of insurance
The Secretary is authorized and empowered to waive compliance with
any rule or regulation prescribed by the Secretary for the purposes of
this section if, in the Secretary's judgment, the enforcement of such
rule or regulation would impose an injustice upon an insured lending
institution which has substantially complied with such regulations in
good faith. Any payment for loss made to an insured financial
institution under this section shall be final and incontestable after
two years from the date the claim was certified for payment by the
Secretary, in the absence of fraud or misrepresentation on the part of
such institution unless a demand for repurchase of the obligation shall
have been made on behalf of the United States prior to the expiration of
such two-year period. The Secretary is authorized to transfer to any
financial institution approved for insurance under this chapter any
insurance in connection with any loan which may be sold to it by another
insured financial institution.
(e) Maximum aggregate amount of loans and advances insured
The aggregate amount of loans and advances insured under this
section shall not exceed $1,500,000,000 at any one time.
(Pub. L. 94-50, title I, Sec. 105, July 2, 1975, 89 Stat. 251.)
Section Referred to in Other Sections
This section is referred to in sections 2703, 2705, 2706 of this
title.