CHAPTER 286
FORMERLY
SENATE BILL NO. 315
AN ACT TO AMEND CHAPTER 40, TITLE 31, DELAWARE CODE, BY ADDING THERETO SUBCHAPTER VII ESTABLISHING A DELAWARE HOME IMPROVEMENT INSURANCE FUND AND PROVIDING AN APPROPRIATION FOR THE FUNDING THEREOF.
WHEREAS, the General Assembly declares that it is a subject of concern that many residents of this State are living in substandard housing and that there exists a shortage of housing at reasonable costs for various income levels; and
WHEREAS, the General Assembly recognizes that adequate multiple and single family housing can, and should, be provided by private capital under our free enterprise system and in accordance with sound investment practices; and
WHEREAS, the General Assembly finds that the flow of private investment capital into such housing can be stimulated by a system wherein qualified lending institutions may be insured against losses incurred as a result of nonpayment of principal, interest, or other sums agreed to be paid under the terms of any note or bond or other evidence of indebtedness; and
WHEREAS, the General Assembly further declares that all the purposes and provisions herein and all standards and regulations promulgated pursuant to authorization granted herein are public purposes and uses for which public monies may be borrowed, expended, advanced, loaned or granted.
Be it enacted by the General Assembly of the State of Delaware:
Section 1. Amend Chapter 40, Title 31, Delaware Code, by inserting a new Subchapter to read as follows:
"SUBCHAPTER VII. ESTABLISHMENT OF DELAWARE HOME IMPROVEMENT INSURANCE FUND
§4080. Establishment of a Delaware Home improvement Insurance Fund
There is here by appropriated and transferred one million dollars ($1,000,000), when first available, from the Capital Investment Fund, established by Chapter 62, Title 29, Delaware Code, to the Department of Community Affairs and Economic Development and such funds shall be deposited in a fund which shall be known as the "Delaware Home Improvement Insurance Fund" which shall be administered by the Secretary of the Department of Community Affairs and Economic Development by and through the Delaware State Housing Authority as a fund for carrying out the purposes of this Act. Sums received from appropriations, fees, and all other amounts related to the mortgages insured pursuant to this Act shall be deposited in such fund. The •fund shall be charged with any and all expenses related to carrying out the provisions of this Act, including, but not limited to, administrative expenses, loan losses and other related charges.
The Delaware State Housing Authority is authorized to enter into agreements with any financial institution to guarantee mortgage loans to persons who qualify upon income schedules and upon such other reasonable terms and conditions as the Housing Authority shall require by rule and regulation, provided:
(b) The loan is secured by collateral acceptable to the Housing Authority.
(c) The mortgaged property is owner-occupied.
(d) The occupancy of the mortgaged property is limited to not more than four (4) families.
(e) The Housing Authority has determined that financing is not available on equivalent terms and conditions without the assistance of the mortgage insurance provided by this Act.
(f) The Housing Authority has determined that the insured loan, together with all other debts secured by the same property, does not exceed the fair market value of the property securing said loan.
(g) The Housing Authority has determined that the primary objective of the insured loan is to bring the mortgaged property into compliance with state, county and municipal housing codes.
The Delaware State Housing Authority, upon authorization by the mortgagee, may insure upon such terms as it may prescribe, any mortgage offered which is eligible for insurance under the provisions of this Act. Fees shall be established for said insurance in an amount calculated to cover administrative costs for this program as well as payments made where defaults on mortgages cause losses to lenders.
§4083. Insurance, standards for eligibility reasonable to provide that the insurance shall aid in the financing of rehabilitation of housing. These standards shall also assure that the mortgagee is responsible and able to service the mortgage and the property. The Delaware State Housing Authority shall promulgate such rules and regulations as are necessary to carry out the purposes and provisions of this Act."
Section 2. If any provision of this Act or the application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of the Act which can be given effect without the invalid provision or application, and to this end the provisions of this Act are declared to be severable.
Section 3. This Act shall take effect upon approval.
Approved August 7, 1975