Commit to advance and advance in instalments up to the full amount of any mortgage securing a construction loan made by an authorized lender, to provide for the purchase and improvement of a lot and the completion of the construction for which the loan is to be made, under the terms of this section.
Mail checks, share drafts or other drafts or otherwise transfer or arrange for transfer of funds, to authorized lenders not sooner than 7 days prior to proposed closing or disbursement dates.
Designate and maintain a current list of lenders authorized to make or service loans under this section. The department shall promulgate rules establishing standards for and governing the performance of authorized lenders in making and servicing loans under this section and shall periodically monitor such performance. The department shall promulgate rules to provide for the removal from its list of authorized lenders of any lender that makes an excessive number of errors on loan applications processed under subd. 1.
The department may summarily remove from its list of authorized lenders any lender that indicates it does not wish to participate in the program and after hearing on notice remove from its list of authorized lenders any lender that fails to conform with the rules of the department governing such performance, and may refuse to permit a lender so removed to make or service any loan under this section until such time as the department is satisfied that the lender will conform with such rules.
Require borrowers to make monthly escrow payments to be held by the authorized lender for real estate taxes and casualty insurance premiums which shall be paid by the authorized lender where due to the extent of the amounts owing thereon or to the extent escrowed, whichever is less.
The department may exercise all of the powers vested in it under this subchapter in respect to any applications for loans and loans approved under this section and in respect to any mortgages and mortgage notes executed to authorized lenders and assigned to and purchased by the authority under this section and the properties securing such mortgages. The department is specifically authorized in its discretion to exercise or authorize such powers to be exercised in its own name.
With prior approval of the building commission, retire all 1981 veterans home loan revenue bonds and transfer any assets remaining in the bond fund after retirement into the veterans trust fund. The department may sell the assets transferred to the veterans trust fund under this subdivision and deposit the proceeds of any sale into the veterans trust fund.
Persons receiving loans under this section shall pay at the time of closing an origination fee to the authorized lender participating in the loan. The origination fee charged to borrowers under this section shall be negotiated between the department and the authorized lender but may not exceed that which the authorized lender would charge other borrowers in the ordinary course of business under the same or similar circumstances.
(6) Sources of loan funds.
Funding for loans authorized by this section may, at the discretion of the building commission, be provided by one or a combination of:
The secretary, with the approval of the governor and subject to the limits of s. 20.866 (2) (zn)
, may request that state debt be contracted in accordance with ch. 18
. Debt so requested must meet each of the following additional requirements:
State debt may be contracted when it reasonably appears to the building commission that all state obligations so incurred under this paragraph and s. 20.866 (2) (zo)
can be fully paid from moneys received from veterans repayments of loans on mortgages and mortgage notes funded under this paragraph and other available revenues of the veterans mortgage loan repayment fund. In making this determination, the building commission may take into account the effect of its planned future actions to refinance existing state debt, to create reserve funds and to modify the structure of the total debt outstanding so as to ensure that projected repayments of loans on mortgages and mortgage notes, together with other available moneys, will be sufficient as received to fund debt service payments as due. It is the intent of the legislature that the program authorized under this section be fully self-supporting and that it be so administered that all debt service and all related costs of the program under this section will require no supplemental support from the general fund.
The chairperson of the board shall certify that the chairperson does not expect proceeds of state debt issued under this paragraph to be used in a manner that would cause the debt to be arbitrage bonds as defined by the internal revenue code, where that debt is a bond that is exempt from federal taxation.
Debt of the authority.
Loans made under this section may be purchased by the authority from the veterans housing loan fund under s. 234.41
. All receipts of interest, except amounts retained as servicing fees by the authorized lenders servicing such loans purchased by the authority, and principal on such loans, payments of losses by insurers not used for restoration of the property securing such loans, and any other collections, shall be deposited by the authority in the veterans housing bond redemption fund under s. 234.43
and shall be disbursed therefrom as provided in s. 234.43 (2)
The secretary, with the approval of the governor and subject to the limits of sub. (9)
, may request that revenue obligations be contracted in accordance with subch. II of ch. 18
. Revenue obligations so requested must meet the following additional requirements:
Revenue obligations may be contracted when it reasonably appears to the building commission that all obligations incurred under this paragraph can be fully paid from moneys received from veterans' repayments of loans on mortgages and mortgage notes funded under this paragraph.
The chairperson of the board shall certify that the board and the department do not expect and shall not use proceeds of revenue obligations issued under this paragraph in a manner that would cause the revenue obligations to be arbitrage bonds as defined in the U.S. internal revenue code, where that debt is a bond that is exempt from federal taxation.
(7) Repayment of mortgage loans. 45.79(7)(a)(a)
There is created the veterans mortgage loan repayment fund. All moneys received by the department for the repayment of loans funded under sub. (6) (a)
except for servicing fees required to be paid to authorized lenders, net proceeds from the sale of mortgaged properties, any repayment to the department of moneys paid to authorized lenders, gifts, grants, other appropriations and interest earnings accruing thereon, any repayment of moneys borrowed under s. 45.356 (9) (a)
and any moneys deposited or transferred under s. 18.04 (6) (b)
shall be promptly deposited into the veterans mortgage loan repayment fund. The board shall establish by resolution a system of accounts providing for the maintenance and disbursement of moneys of the veterans mortgage loan repayment fund to fund loans under sub. (6) (a)
or to fund, refund or acquire public debt as provided in s. 18.04 (5)
. The system of accounts shall record and provide moneys for all of the following purposes:
Transfer to the bond security and redemption fund.
The acquisition or redemption of public debt in accordance with resolutions of the building commission.
Payment of losses arising from delinquency or default in the repayment of loans funded under sub. (6) (a)
, including loss of principal and interest accrued to the point of final disposition of the defaulted loan and the expenses of management and sale of the property taken upon default of loan repayment.
Payment of all costs incurred by the department in processing and servicing loans and accounting for and administering the program under this section, including a portion of grants made to county veterans' service officers under s. 45.43 (7)
Payment of all costs incurred in contracting public debt for the purposes under s. 18.04 (5)
and under s. 18.04 (2)
for the purpose of funding veterans' housing loans.
Payment of costs of issuance of obligations to fund loans under sub. (6) (c)
if not paid from the proceeds of the obligations.
Payment of any other costs of program operation and management authorized under this section.
To loan money to the veterans trust fund, upon prior approval of the building commission for each loan, for the purposes under s. 45.356
The board may amend the system of accounts established under par. (a)
only by resolution of the board that is approved by the building commission.
If revenues of the veterans mortgage loan repayment fund are insufficient to meet all current expenses, the secretary of administration shall establish a repayment schedule whereby the general fund will be reimbursed in an orderly manner for moneys advanced. Interest rates to be charged on loans subsequently issued shall be adjusted to provide sufficient revenues to meet this repayment schedule.
After meeting all expenses and providing for reserves under par. (a) 3.
, assets in the veterans mortgage loan repayment fund, upon prior approval of the building commission, may be transferred to the veterans trust fund and used to fund loans under s. 45.356
(7m) Use of surpluses.
Surpluses may be used under sub. (10) (c)
only if there are no unrestricted fund balances available for that purpose in the funds created under sub. (9)
. Section 20.001 (3) (e)
shall not be construed to prohibit this action.
(8) Limitation on remodeling or alteration for a disabled veteran.
Not more than 50% of the proceeds of a loan granted under this section for a purpose under s. 45.76 (1) (a)
may be used for remodeling or alteration of the housing accommodation after purchase to meet the special needs of a veteran due to a permanent and total service-connected disability. That portion of the proceeds used for this purpose shall be reserved and distributed by the authorized lender.
(9) Repayment of revenue obligations. 45.79(9)(a)(a)
All moneys received from any source for repayment of loans, mortgages or mortgage loan notes funded with proceeds of revenue obligations issued under sub. (6) (c)
shall be deposited into one or more separate nonlapsible trust funds in the state treasury or with a trustee as provided in s. 18.56 (9) (j)
. The board may pledge revenues received by the funds to secure revenue obligations issued under sub. (6) (c)
and shall have all other powers necessary and convenient to distribute the proceeds of the revenue obligations and loan repayments in accordance with subch. II of ch. 18
. Unrestricted balances in the funds may be used to fund additional loans issued under sub. (6) (c)
and pay the balances owing on loans after the assumptions of the loans or the closings of the sales of residences under sub. (10) (c)
Revenue obligations issued under sub. (6) (c)
shall not exceed $280,000,000 in principal amount, excluding obligations issued to fund or refund outstanding revenue obligation notes or to refund outstanding revenue obligation bonds.
Except as may otherwise be expressly provided in resolutions authorizing the issuance of revenue obligations or in other agreements with the holders of revenue obligations, each issue of revenue obligations shall be on a parity with every other revenue obligation issued under sub. (6) (c)
and payable in accordance with subch. II of ch. 18
Upon any sale of the residence which secures a guaranteed loan made under this section after April 3, 1980, except for the purchase of the residence at the time the loan is initially made, the guaranteed loan may be assumed or continue to be paid in regular monthly instalments if the person who assumes the mortgage loan payments or who will make the regular monthly instalments agrees:
To pay interest on the loan from the date of the assumption of the loan, if the loan is assumed, or from the date of the closing of the sale of the residence at the maximum rates of interest being charged on guaranteed loans on the date the loan was initially made; and
To increase the amortization payments on the loan by an amount sufficient to amortize the loan by the date the balance thereon is payable in full according to the original terms of the loan.
The department and authorized lenders shall increase the interest rates and amortization payments on loans assumed under par. (a)
After the assumption of a guaranteed loan funded under sub. (6) (c)
, if the loan is assumed, or the closing of the sale of a residence on which a balance is owing on a guaranteed loan funded under sub. (6) (c)
, the balance owing on the loan on the date of the assumption of the loan, if the loan is assumed, or the closing of the sale may be paid to the funds created under sub. (9)
from available surpluses, if any, in the veterans mortgage loan repayment fund under sub. (7) (c)
. The loan and the mortgage and mortgage note pertaining to the loan may be purchased by the veterans mortgage loan repayment fund under sub. (7)
(12) Prior program loans.
Subject to this section and ss. 45.73
, neither the department nor an authorized lender may deny a person a loan under this section because of the reason the person sold any property previously mortgaged by the person to the department or an authorized lender, if the person completely paid the balance of any previous loan under this subchapter in accordance with the terms and conditions of the promissory note and the mortgage or other agreement executed in connection with the previous loan.
History: 1973 c. 208
; 1975 c. 26
; 1977 c. 4
; 1979 c. 4
; 1979 c. 168
; 1979 c. 221
; 1981 c. 45
; 1981 c. 93
; 1983 a. 27
; 1985 a. 6
; 1985 a. 332
s. 251 (1)
; 1987 a. 27
; 1987 a. 403
; 1989 a. 31
; 1991 a. 39
; 1993 a. 16
; 1995 a. 252
; 1997 a. 27
Disregard of agent orange litigation payment.
Notwithstanding any other provision of this chapter, the department or authorized lender shall not consider any payment received by a veteran or a veteran's dependent from the settlement approved by the U.S. district court in the case of In re "Agent Orange" Product Liability Litigation, 618 F. Supp. 623
(D.C.N.Y. 1985), as income or assets for purposes of determining eligibility for primary mortgage loans under s. 45.79