[Federal Register Volume 61, Number 249 (Thursday, December 26, 1996)]
[Rules and Regulations]
[Pages 67930-67931]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-32769]


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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

24 CFR Part 206

[Docket No. FR-2958-C-06]
RIN 2502-AF32


Home Equity Conversion Mortgage Insurance Demonstration: 
Additional Streamlining; Correction and Delay of Effective Date for the 
Definition of ``Principal Limit'' in Sec. 206.3

AGENCY: Office of the Assistant Secretary for Housing-Federal Housing 
Commissioner, HUD.

ACTION: Final rule correction and delay of effective date.

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SUMMARY: On September 17, 1996 (61 FR 49030), the Department issued a 
final rule to changes proposed on May 10, 1996, to the Home Equity 
Conversion Mortgage (HECM) Insurance Demonstration. The final rule had 
an effective date of October 17, 1996, except that the amendment to the 
definition of ``principal limit'' in Sec. 206.3, had a delayed 
effective date of January 5, 1997. This document further delays the 
effective date of the definition of ``principal limit'' in Sec. 206.3 
until May 1, 1997. In addition, Sec. 206.121(c) is corrected to remove 
language that should have been omitted which allowed HUD to change a 
monthly adjustable ARM to annual interest rate adjustments if assigned 
to HUD.

DATES: Effective date of this document: October 17, 1996.
    Effective date for amended definition of ``principal limit'' in 
Sec. 206.3 is delayed until May 1, 1997.

FOR FURTHER INFORMATION CONTACT: Richard K. Manuel, Director, Home 
Mortgage Insurance Division, Office of Insured Single Family Housing, 
Room number 9272, Department of Housing and Urban Development, 451 
Seventh Street, SW., Washington, DC 20410, telephone (202) 708-2700; 
TTY (202) 708-4594. (These are not toll-free telephone numbers.)

SUPPLEMENTARY INFORMATION: The September 17, 1996 final rule delayed 
the effective date for the amendment to the definition of ``principal 
limit'' in Sec. 206.3, until January 5, 1997. The Department recognized 
at that time that the Lockheed/Martin (CDSI) system would have to be 
changed to accommodate the new calculation. The Department now realizes 
that the change will not be completed by the January 5, 1997 effective 
date and by this notice delays further the effective date.

[[Page 67931]]

    Accordingly, the effective date for the amendment to the definition 
of ``principal limit'' in Sec. 206.3, as stated in the final rule 
published on September 17, 1996, at 61 FR 49030, is delayed until May 
1, 1997.
    The September 17, 1996 final rule inadvertantly failed to delete 
from Sec. 206.121(c) the language allowing HUD to change a monthly 
adjustable ARM to annual interest rate adjustments if assigned to HUD. 
This language had been proposed in the May 10, 1996 proposed rule, at 
61 FR 21918, and opposed by public comment. Therefore, in the preamble 
to the September 17, 1996 final rule, at 61 FR 49030, the Department 
agreed not to make the disputed language final.
    Accordingly, in FR Doc. 96-23717, in the final rule published on 
September 17, 1996 (61 FR 49030), the first and second sentences in 24 
CFR 206.121, are corrected as follows:


Sec. 206.121  Secretary authorized to make payments.

* * * * *
    (c) Second mortgage. If the contract of insurance is terminated as 
provided in Sec. 206.133(c), all payments to the mortgagor by the 
Secretary will be secured by the second mortgage, if any. Payments will 
be due and payable in the same manner as under the insured first 
mortgage. * * *
* * * * *
    Dated: December 19, 1996.
Nicolas P. Retsinas,
Assistant Secretary for Housing--Federal Housing Commissioner.
[FR Doc. 96-32769 Filed 12-24-96; 8:45 am]
BILLING CODE 4210-27-P