AB210,75,2220
(b) Reduce the amounts of monthly installments and provide other terms and
21conditions relative to time and manner of repaying the obligation as it deems
22necessary or reasonable.
AB210,75,24
2345.33 Eligibility and disqualifying factors. (1) Eligible persons. Subject
24to sub. (2) (a) or (b), the following persons may receive a loan under this subchapter:
AB210,75,2525
(a) A veteran.
AB210,76,3
1(b) A person who served on active duty for more than 6 months during the
2period between February 1, 1955, and August 4, 1964, and was honorably
3discharged.
AB210,76,54
(c) The unremarried surviving spouse or dependent child, as defined in s. 45.01
5(6) (b), of a deceased veteran or of a deceased person described in par. (b).
AB210,76,8
6(2) Disqualifying factors. (a) A person listed in sub. (1) may not receive a loan
7under this subchapter if the department or authorized lender determines that any
8of the following applies:
AB210,76,109
1.
The person will be incurring an excessive indebtedness in view of the person's
10income.
AB210,76,1211
2.
The person has a previous loan outstanding under this subchapter, unless
12any of the following apply:
AB210,76,1413
a. The previous loan has been assumed by an eligible person with the
14department's approval upon the sale of the residence securing the previous loan.
AB210,76,1615
b. The person is applying for a loan under s. 45.37 for a purpose under s. 45.34
16(1) (c) and the previous loan was made under s. 45.37.
AB210,76,1917
(b) A person listed in sub. (1) who is not a permanently and totally disabled
18veteran may not receive a loan under this subchapter if the department or authorized
19lender determines that any of the following applies:
AB210,76,2420
1.
The person is delinquent in child support or maintenance payments or owes
21past support, medical expenses, or birth expenses, as evidenced by the appearance
22of the person's name on the statewide support lien docket under s. 49.854 (2) (b),
23unless the person provides the department or authorized lender with one of the
24following:
AB210,77,3
1a. A repayment agreement that the person has entered into, that has been
2accepted by the county child support agency under s. 59.53 (5) and that has been kept
3current for the 6-month period immediately preceding the date of the application.
AB210,77,74
b. A statement that the person is not delinquent in child support or
5maintenance payments and does not owe past support, medical expenses, or birth
6expenses, signed by the department of workforce development or its designee within
77 working days before the date of the application.
AB210,77,118
2.
The amount of the loan exceeds 2.5 times the median price of a home in this
9state. The department shall establish the median price of a home in this state for
10each fiscal year by using the most recent housing price index generated by the
11Wisconsin Realtors Association before July 1.
AB210,77,14
1245.34 Uses for loan proceeds. (1)
Mortgage loan program. An authorized
13lender may, with the approval of the department, make loans under s. 45.37 for any
14of the following purposes:
AB210,77,1515
(a)
The purchase of one of the following:
AB210,77,1916
1. A manufactured home or real property on which a manufactured home is to
17be situated, but only if the eligible person has available and applies on the total cost
18of the property, an amount equivalent to at least 15 percent of the total cost. This
1915 percent requirement does not apply to a disabled veteran.
AB210,77,2020
2. A home and eligible rehabilitation of a home, as defined in s. 234.49 (1) (d).
AB210,77,2221
(b)
The construction of a home, including housing accommodation and garage,
22and the acquisition of land therefor.
AB210,78,223
(c)
A loan of not more than $25,000 to improve a home, including the
24construction of a garage or the removal or other alteration of existing improvements
1that were made to improve the accessibility of a home for a permanently and totally
2disabled individual.
AB210,78,103
(d) 1. Refinancing the balance due on an indebtedness that was incurred for a
4use designated in pars. (a) to (c) if the balance owing on the indebtedness does not
5exceed the amount requested in a prior loan application from that eligible person and
6if the indebtedness was incurred by that person after a prior loan application from
7that person was denied by the department. Refinancing loans may be made under
8this paragraph only if the board reverses the department's denial after determining
9that the prior application met requirements in effect on the date of the denial and
10that the loan application should have been approved.
AB210,78,1311
2. Refinancing the balance due on a construction period loan, bridge loan, or
12other financing if the financing was used for a purpose designated in par. (b) and has
13a term of 24 months or less.
AB210,78,19
14(2) Conditions. (a)
No loan may be made under this subchapter if the
15department or authorized lender determines that the total cost of the property
16exceeds its market value unless the amount by which the cost of the property exceeds
17its market value is paid by the borrower in addition to the contribution required by
18s. 45.35. This paragraph does not apply to a permanently and totally disabled
19veteran.
AB210,78,2120
(b)
The department or authorized lender may require any person applying for
21a loan under this subchapter to certify that:
AB210,78,2422
1. The residence to be purchased, constructed, improved, or refinanced with
23financial assistance under this subchapter will be used as the person's principal
24residence.
AB210,79,5
12. Unless other acceleration provisions are permitted under s. 45.36 (2), the
2loan made under this subchapter will be repaid in full upon sale of the residence or
3any of the person's interest in it. A divorce judgment divesting the person's interest
4in the residence or a quit claim deed executed under the judgment does not constitute
5a sale.
AB210,79,11
645.35 Contribution. No loan may be made under this subchapter unless, in
7addition to the closing costs that the person may be required to pay, the person has
8available, and applies on the total cost of the property for which the loan is made, an
9amount equivalent to at least 5% of the total cost. The amount may consist of money
10or other assets, including equity in real property. This section does not apply to a
11permanently and totally disabled veteran.
AB210,79,15
1245.36 Manner of repayment. (1) Monthly payments; right to prepay. Each
13loan made under this subchapter shall be repaid in monthly installments with the
14option to pay additional sums. Any additional payments must be paid on the regular
15installment payment date.
AB210,79,18
16(2) Acceleration provisions. All loans made under this subchapter shall be
17repaid in full upon sale of the residence securing the loan or any interest in such
18residence, unless one of the following applies:
AB210,79,1919
(a) The sale is to another eligible person.
AB210,79,2120
(b) The department or authorized lender servicing the loan determines that
21acceleration will jeopardize collection of the loan balance.
AB210,79,2322
(c) The loan is a guaranteed loan which is assumed or paid in regular monthly
23installments under s. 45.37 (11) (a).
AB210,80,2
2445.37 Mortgage loan program. (1) Loans authorized. An authorized lender
25or a county veterans service officer may, as agent for and with the approval of the
1department, make loans to eligible persons for qualified purposes in the manner
2provided under this section.
AB210,80,9
3(2) Loan applications. (a)
Applications for loans under this section for a
4purpose specified in s. 45.34 (1) (a), (b), or (d) shall be made to an authorized lender
5and applications for loans under this section for a purpose specified under s. 45.34
6(1) (c) may be made to the department or to a county veterans service officer on forms
7approved by the department and signed by the applicant. If the applicant is married
8and not legally separated under s. 767.02 (1) (d) or in the process of obtaining a
9divorce, the applicant's spouse also shall sign the application.
AB210,80,1110
(b)
The applicant may apply directly to the department or through a county
11veterans service officer for certification of eligibility.
AB210,81,4
12(3) Loans to be secured. (a)
Each loan made under this section, except a loan
13of $3,000 or less for a purpose specified under s. 45.34 (1) (c), shall be evidenced by
14a promissory installment note and secured by a mortgage on the real estate in respect
15to which the loan is granted. A loan of $3,000 or less made for a purpose specified
16under s. 45.34 (1) (c) shall be evidenced by a promissory installment note and shall
17be secured by a guarantor or by a mortgage on the real estate in respect to which the
18loan is granted. Any loan having as its source funds provided under sub. (6) (a) and
19secured by a mortgage shall have the mortgage name the department as mortgagee
20and payee. Any loan having as its source funds provided under sub. (6) (b) and
21secured by a mortgage shall have the mortgage name the authorized lender involved
22as mortgagee and payee, and such mortgage and note shall be assigned by the
23authorized lender to the authority immediately upon execution. A mortgage
24securing a loan made for a purpose specified in s. 45.34 (1) (a), (b), or (d) shall have
25priority over all liens against the mortgaged premises and the buildings and
1improvements to the buildings, except tax and special assessment liens filed after
2the recording of the mortgage. A mortgage securing a loan made for a purpose
3specified under s. 45.34 (1) (c) is acceptable if the applicant can establish a minimum
4equity in the property, as established by the department by rule.
AB210,81,75
(b)
Mortgages given to secure loans under this section shall provide for
6adequate fire and extended coverage insurance. Policies providing such insurance
7coverage shall name the authorized lender or the department as an insured.
AB210,81,13
8(4) Interest rate determined. (a) The board shall determine the interest rate
9on loans made under this section. Except as provided in sub. (11), the interest rate
10determined may not be increased during the term of the loan. Except as provided
11in sub. (11), the interest rate shall be as low as possible but shall be sufficient to fully
12pay all expenses and to provide reserves that are reasonably expected to be required
13in the judgment of the board in accordance with par. (b) and sub. (7) (a) 3.
AB210,81,1714
(b) 1. The board shall select and implement the methods of insuring against
15losses arising from delinquency and default in the repayment of loans funded under
16sub. (6) (a) and shall select and implement the methods of managing and selling any
17property securing loans funded under sub. (6) (a).
AB210,81,1918
2. The board shall charge or cause to be charged to borrowers all costs necessary
19to insure against losses under subd. 1.
AB210,81,2120
3. Moneys collected under subd. 2. and that are held by the state shall be
21deposited, reserved, and expended as provided in sub. (7) (a) 3.
AB210,81,2422
(c) Loans made pursuant to this section shall not be subject to s. 138.05,
23138.051, or 138.052, except that a loan originated under this section after May 3,
241996, is subject to s. 138.052 (5).
AB210,82,2
1(5) Administrative provisions. (a) The department may do any of the
2following:
AB210,82,153
1. Enter into contracts with authorized lenders throughout this state
4authorizing such lenders to process applications and close and service loans made
5under this section. The contracts shall include the responsibilities of the authorized
6lender with respect to credit evaluations, financial eligibility determinations,
7valuation of the home for which the loan is to be made, collection procedures in the
8event of delinquent loan repayments, and other functions that the department may
9require. The contracts shall authorize the lender to retain an amount from the
10monthly payments for servicing loans made under this section. The rate of the
11service fee shall not exceed a maximum rate established by the department with the
12lender in accordance with current practices under similar programs, and shall be
13stated in the contracts. The department shall specify in the contracts a maximum
14length of time between receipt of monthly mortgage payments by the lender and
15transmittal of such payments to the state or the authority.
AB210,82,1816
2. Commit to advance and advance funds in the full amount of any mortgage
17securing a purchase loan to be made by an authorized lender in accordance with the
18terms under this section.
AB210,82,2219
3. Commit to advance and advance in installments up to the full amount of any
20mortgage securing a construction loan made by an authorized lender, to provide for
21the purchase and improvement of a lot and the completion of the construction for
22which the loan is to be made, under the terms of this section.
AB210,82,2523
4. Mail checks, share drafts, or other drafts, or otherwise transfer or arrange
24for transfer of funds to authorized lenders not sooner than 7 days prior to proposed
25closing or disbursement dates.
AB210,83,13
15. Designate and maintain a current list of lenders authorized to make or
2service loans under this section. The department shall promulgate rules
3establishing standards for and governing the performance of authorized lenders in
4making and servicing loans under this section and shall periodically monitor such
5performance. The department shall promulgate rules to provide for the removal
6from its list of authorized lenders of any lender that makes an excessive number of
7errors on loan applications processed under subd. 1. The department may
8summarily remove from its list of authorized lenders any lender that indicates it does
9not wish to participate in the program and after hearing on notice remove from its
10list of authorized lenders any lender that fails to conform with the rules of the
11department governing that performance, and may refuse to permit a lender so
12removed to make or service any loan under this section until the department is
13satisfied that the lender will conform with its rules.
AB210,83,2514
6. Require borrowers to make monthly escrow payments to be held by the
15authorized lender or the department for real estate taxes and casualty insurance
16premiums. The authorized lender or the department shall pay all of the amounts due
17for real estate taxes and casualty insurance premiums, even if the amount held in
18escrow is insufficient to cover the amounts due. If the amount held in escrow is
19insufficient to cover the amounts due, the authorized lender or the department shall
20recover from the borrower, after paying the amounts due under this subdivision, an
21amount equal to the difference between the amounts paid and the amount held in
22escrow. If the amount held in escrow is more than the amounts due, the authorized
23lender or the department shall refund to the borrower, after paying the amounts due
24under this subdivision, an amount equal to the difference between the amount held
25in escrow and the amounts paid by the authorized lender or the department.
AB210,84,1
17. Obtain guarantees for loans under
38 USC 1801 to
1827.
AB210,84,72
8. Exercise all of the powers vested in it under this subchapter with respect to
3any applications for loans and loans approved under this section and with respect to
4any mortgages and mortgage notes executed to authorized lenders and assigned to
5and purchased by the authority under this section and the properties securing those
6mortgages. The department may exercise or authorize those powers to be exercised
7in its own name.
AB210,84,128
9. With prior approval of the building commission, retire all 1981 veterans
9home loan revenue bonds and transfer any assets remaining in the bond fund after
10retirement into the veterans trust fund. The department may sell the assets
11transferred to the veterans trust fund under this subdivision and deposit the
12proceeds of any sale into the veterans trust fund.
AB210,84,1413
10. Service loans made under this section and purchase from authorized
14lenders the servicing rights for loans made by authorized lenders under this section.
AB210,84,1615
11. Enter into contracts with persons other than authorized lenders for the
16servicing of loans made under this section.
AB210,84,1817
12. Loan money from the veterans trust fund to the veterans mortgage loan
18repayment fund to fund loans under this section.
AB210,85,219
(b)
At the time of closing, persons receiving loans under this section shall pay
20an origination fee to the authorized lender participating in the loan, except that the
21department shall pay, on behalf of a veteran who receives a loan under this section
22and who has at least a 30 percent service-connected disability rating for purposes
23of
38 USC 1114 or
1134, the origination fee to the authorized lender. The origination
24fee charged under this paragraph shall be negotiated between the department and
25the authorized lender but may not exceed that which the authorized lender would
1charge other borrowers in the ordinary course of business under the same or similar
2circumstances.
AB210,85,5
3(6) Sources of loan funds. Funding for loans authorized under this section
4may, at the discretion of the building commission, be provided by one or a
5combination of the following:
AB210,85,86
(a)
The secretary, with the approval of the governor and subject to the limits
7of s. 20.866 (2) (zn), may request that state debt be contracted in accordance with ch.
818. Debt requested shall meet all of the following additional requirements:
AB210,85,229
1. State debt may be contracted when it reasonably appears to the building
10commission that all state obligations so incurred under this paragraph and s. 20.866
11(2) (zo) can be fully paid from moneys received from veterans repayments of loans on
12mortgages and mortgage notes funded under this paragraph and other available
13revenues of the veterans mortgage loan repayment fund. In making this
14determination, the building commission may take into account the effect of its
15planned future actions to refinance existing state debt, to create reserve funds, and
16to modify the structure of the total debt outstanding so as to ensure that projected
17repayments of loans on mortgages and mortgage notes, together with other available
18moneys, will be sufficient as received to fund debt service payments as due. It is the
19intent of the legislature that the program authorized under this section be fully
20self-supporting and that it be administered so that all debt service and all related
21costs of the program under this section will require no supplemental support from
22the general fund.
AB210,86,223
2. The chairperson of the board shall certify that the chairperson does not
24expect proceeds of state debt issued under this paragraph to be used in a manner that
1would cause the debt to be arbitrage bonds as defined in the Internal Revenue Code,
2if that debt is a bond that is exempt from federal taxation.
AB210,86,93
(b)
Loans made under this section may be purchased by the authority from the
4veterans housing loan fund under s. 234.41. All receipts of interest, except amounts
5retained as servicing fees by the authorized lenders servicing the loans purchased
6by the authority, and principal on the loans, payments of losses by insurers not used
7for restoration of the property securing the loans, and any other collections, shall be
8deposited by the authority into the veterans housing bond redemption fund under
9s. 234.43 and shall be disbursed from the fund as provided in s. 234.43 (2).
AB210,86,1310
(c)
The secretary, with the approval of the governor and subject to the limits
11of sub. (10), may request that revenue obligations be contracted in accordance with
12subch. II of ch. 18. Revenue obligations requested shall meet all of the following
13additional requirements:
AB210,86,1714
1. Revenue obligations may be contracted when it reasonably appears to the
15building commission that all obligations incurred under this paragraph can be fully
16paid from moneys received from veterans repayments of loans on mortgages and
17mortgage notes funded under this paragraph.
AB210,86,2218
2. The chairperson of the board shall certify that the board and the department
19do not expect and shall not use proceeds of revenue obligations issued under this
20paragraph in a manner that would cause the revenue obligations to be arbitrage
21bonds as defined in the Internal Revenue Code, where that debt is a bond that is
22exempt from federal taxation.
AB210,87,11
23(7) Repayment of mortgage loans. (a) There is created the veterans mortgage
24loan repayment fund. All moneys received by the department for the repayment of
25loans funded under sub. (6) (a) except for servicing fees required to be paid to
1authorized lenders, net proceeds from the sale of mortgaged properties, any
2repayment to the department of moneys paid to authorized lenders, gifts, grants,
3other appropriations, and interest earnings accruing, any repayment of moneys
4borrowed under s. 45.42 (8) (a), all moneys received under sub. (5) (a) 6., and any
5moneys deposited or transferred under s. 18.04 (6) (b) or (d) shall be promptly
6deposited into the veterans mortgage loan repayment fund. The board shall
7establish by resolution a system of accounts providing for the maintenance and
8disbursement of moneys of the veterans mortgage loan repayment fund to fund loans
9under sub. (6) (a) or to fund, refund, or acquire public debt as provided in s. 18.04 (5).
10The system of accounts shall record and provide moneys for all of the following
11purposes:
AB210,87,1212
1. Transfer to the bond security and redemption fund.
AB210,87,1413
2. Acquisition or redemption of public debt in accordance with resolutions of
14the building commission.
AB210,87,1815
3. Payment of losses arising from delinquency or default in the repayment of
16loans funded under sub. (6) (a), including loss of principal and interest accrued to the
17point of final disposition of the defaulted loan and the expenses of management and
18sale of the property taken upon default of loan repayment.
AB210,87,2219
4. Payment of all costs incurred by the department in processing and servicing
20loans, purchasing servicing rights for loans under this section, and accounting for
21and administering the program under this section, including a portion of grants
22made to county veterans service officers under s. 45.82.
AB210,87,2523
5. Payment of all costs incurred in contracting public debt for the purposes
24under s. 18.04 (5) and under s. 18.04 (2) for the purpose of funding veterans housing
25loans.
AB210,88,2
16. Payment of costs of issuance of obligations to fund loans under sub. (6) (c)
2if not paid from the proceeds of the obligations.
AB210,88,33
7. Payment of obligations arising from loans funded under sub. (6) (b).
AB210,88,54
8. Payment of any other costs of program operation and management
5authorized under this section.
AB210,88,76
9. Loan money to the veterans trust fund, upon prior approval of the building
7commission for each loan, for the purposes under s. 45.42.
AB210,88,108
10. Payment of origination fees, on behalf of veterans who have at least a 30
9percent service-connected disability rating for purposes of
38 USC 1114 or
1134, to
10authorized lenders under sub. (5) (b).
AB210,88,1111
11. Payment required of the department under sub. (5) (a) 6.
AB210,88,1312
12. Payment of obligations arising from the acquisition of a headquarters and
13museum building for the department under s. 45.03 (5) (b).
AB210,88,1514
(b) The board may amend the system of accounts established under par. (a) only
15by resolution of the board that is approved by the building commission.
AB210,88,2116
(c) If revenues of the veterans mortgage loan repayment fund are insufficient
17to meet all current expenses, the secretary of administration shall establish a
18repayment schedule whereby the general fund will be reimbursed in an orderly
19manner for moneys advanced. Interest rates to be charged on loans subsequently
20issued shall be adjusted to provide sufficient revenues to meet all of this repayment
21schedule.
AB210,88,2522
(d) After meeting all expenses and providing for reserves under par. (a) 3.,
23assets in the veterans mortgage loan repayment fund, upon prior approval of the
24building commission, may be transferred to the veterans trust fund and used to fund
25loans under s. 45.42.
AB210,89,3
1(8) Use of surpluses. Surpluses may be used under sub. (11) (c) only if there
2are no unrestricted fund balances available for that purpose in the funds created
3under sub. (10). Section 20.001 (3) (e) shall not be construed to prohibit this action.
AB210,89,9
4(9) Limitation on remodeling or alteration for a disabled veteran. Not more
5than 50 percent of the proceeds of a loan granted under this section for a purpose
6under s. 45.34 (1) (a) may be used for remodeling or alteration of the housing
7accommodation after purchase to meet the special needs of a permanently and totally
8disabled veteran. That portion of the proceeds used for this purpose shall be reserved
9and distributed by the authorized lender.
AB210,89,21
10(10) Repayment of revenue obligations. (a) All moneys received from any
11source for repayment of loans, mortgages, or mortgage loan notes funded with
12proceeds of revenue obligations issued under sub. (6) (c) shall be deposited into one
13or more separate nonlapsible trust funds in the state treasury or with a trustee
14appointed for that purpose by the authorizing resolution for the revenue obligations.
15The board may pledge revenues received by the funds to secure revenue obligations
16issued under sub. (6) (c) and shall have all other powers necessary and convenient
17to distribute the proceeds of the revenue obligations and loan repayments in
18accordance with subch. II of ch. 18. Unrestricted balances in the funds may be used
19to fund additional loans issued under sub. (6) (c) and pay the balances owing on loans
20after the assumptions of the loans or the closings of the sales of residences under sub.
21(11) (c).
AB210,89,2422
(b) Revenue obligations issued under sub. (6) (c) may not exceed $280,000,000
23in principal amount, excluding obligations issued to fund or refund outstanding
24revenue obligation notes or to refund outstanding revenue obligation bonds.
AB210,90,5
1(c) Except as may otherwise be expressly provided in resolutions authorizing
2the issuance of revenue obligations or in other agreements with the holders of
3revenue obligations, each issue of revenue obligations shall be on a parity with every
4other revenue obligation issued under sub. (6) (c) and payable in accordance with
5subch. II of ch. 18.
AB210,90,11
6(11) Guaranteed loans. (a) Upon any sale of the residence which secures a
7guaranteed loan made under this section after April 3, 1980, except for the purchase
8of the residence at the time the loan is initially made, the guaranteed loan may be
9assumed or continue to be paid in regular monthly installments if the person who
10assumes the mortgage loan payments or who will make the regular monthly
11installments agrees to all of the following:
AB210,90,1512
1. To pay interest on the loan from the date of the assumption of the loan, if the
13loan is assumed, or from the date of the closing of the sale of the residence at the
14maximum rates of interest being charged on guaranteed loans on the date the loan
15was initially made.
AB210,90,1816
2. To increase the amortization payments on the loan by an amount sufficient
17to amortize the loan by the date the balance on the loan is payable in full according
18to the original terms of the loan.