2005 Connecticut Code - Sec. 8-286. Purposes and terms of loan. Residential mortgage guarantee programs.

      Sec. 8-286. Purposes and terms of loan. Residential mortgage guarantee programs. (a) The authority shall administer, within the resources allocated by the State Bond Commission to the Department of Economic and Community Development for the purposes of sections 8-283 to 8-289, inclusive, the homeownership loan program established by said sections 8-283 to 8-289. The purpose of the program shall be to provide, through a contract, an eligible family or person based on the financial needs of such family or person, a loan or deferred loan to assist in the purchase of a dwelling or the purchase and rehabilitation of a dwelling containing up to four residential units, provided such family or person shall reside in at least one of such units. In the case of a deferred loan, the contract shall require that payments on interest are due currently but that payments on principal may be made at a later time.

      (b) Such loan or deferred loan shall not exceed twenty-five per cent of the cost of acquiring such dwelling or twenty-five per cent of the value of such dwelling after rehabilitation, if greater; except that no such limitation may apply to any loan made to a tenant whose dwelling unit is being converted to a condominium and who is able to obtain a mortgage for the purchase of such dwelling unit. Such value shall be determined from the appraisal, if any, required by the lending institution granting the first mortgage loan on such dwelling, and if no such appraisal has been made at the time that a contract for loan is entered into pursuant to this chapter, the authority shall cause such appraisal to be made.

      (c) Commencing October 1, 1995, the proceeds of the sale of any bonds of the state authorized by any public or special act effective on or after July 1, 1995, that are to be used for the purpose of making loans or deferred loans pursuant to this chapter shall be used by the department to make grants-in-aid to the authority and used by the authority, subject to the purposes and conditions of this chapter, for the purpose of making loans or deferred loans pursuant to this chapter.

      (d) The commissioner shall establish and administer within available funds a residential mortgage guarantee program for eligible persons purchasing a home for owner occupancy. Real property eligible for the program shall be located in public investment communities, as defined in section 7-545, and may contain one to three dwelling units.

      (P.A. 77-612, S. 4; P.A. 80-396, S. 2, 5; P.A. 92-166, S. 21, 31; P.A. 95-202, S. 1; 95-250, S. 28, 42; 95-309, S. 11, 12.)

      History: P.A. 80-396 amended Subsec. (b) to exclude twenty-five per cent loan limit in cases where tenant is purchasing his dwelling unit upon its conversion to a condominium; P.A. 92-166 amended Subsec. (a) to make deferred loans a form of financial assistance available under the section and providing that payments on interest are due immediately but that payments on principal may be made at a later time and amended Subsec. (b) to make technical changes consistent with the changes in Subsec. (a); P.A. 95-202 added new Subsec., designated as Subsec. (d) by the Revisors because of changes enacted in P.A. 95-250, re establishment of residential mortgage guarantee program; P.A. 95-250 amended Subsec. (a) to transfer program from Housing Department to the Connecticut Housing Finance Authority and added Subsec. (c) re use of the proceeds of bonds by the authority; P.A. 95-309 changed effective date of P.A. 95-250 but did not affect this section.