[Federal Register Volume 63, Number 7 (Monday, January 12, 1998)]
[Notices]
[Pages 1886-1887]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-669]
[[Page 1885]]
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Part II
Department of Housing and Urban Development
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Single Family Property Disposition Officer Next Door Sales Program;
Notice
Federal Register / Vol. 63, No. 7 / Monday, January 12, 1998 /
Notices
[[Page 1886]]
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
[Docket No. FR-4277-N-01]
Single Family Property Disposition Officer Next Door Sales
Program
AGENCY: Office of the Assistant Secretary for Housing-Federal Housing
Commissioner, HUD.
ACTION: Notice.
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SUMMARY: Under its Single Family Property Disposition program, the
Department has implemented an initiative to sell HUD-owned single
family homes to law enforcement officers at a 50 percent discount. The
initiative applies to properties located in Revitalization Areas and to
other properties that meet certain exception criteria. These properties
are being made available to law enforcement officers who agree to
occupy them as their primary residence for at least three years. The
Department has taken this action to ensure that homeownership
opportunities are made available to law enforcement officers who are
charged with the responsibility of ensuring the safety and well-being
of residents in the communities they serve and to help promote safe
neighborhoods by furthering the community policing efforts being made
by numerous cities.
FOR FURTHER INFORMATION CONTACT: Joe McCloskey, Director, Single Family
Asset Management Division, Department of Housing and Urban Development,
451 7th St. SW, Room 9174, Washington, D.C. 20410-8000), telephone
number (202) 708-0740 (this is not a toll-free number). For hearing-and
speech-impaired persons, this number may be accessed via TTY by calling
the Federal Information Relay Service at 1-800-877-8339.
SUPPLEMENTARY INFORMATION:
I. Background
A major goal of the Department is to use its resources in a manner
that enhances the general well-being of American communities. Promoting
safe neighborhoods is a critical component of the Nation's housing
policy. One means of furthering this policy is to encourage law
enforcement officers to purchase and reside in HUD-acquired single
family properties. Accordingly, the Department is using its authority
under 24 CFR part 291, Disposition of HUD-Acquired Single Family
Property, to make single family properties nationwide available for
this purpose.
II. Conditions for Purchase of Properties
For purposes of this program, law enforcement officers are defined
as individuals who are employed full time by a federal, state, county,
or municipal government and are sworn to uphold, and make arrests for
violations of, federal, state, county, or municipal law.
Starting on August 11, 1997 and for one year thereafter, for this
Officer Next Door Sales program only, the discount for both insurable
and uninsurable properties that are located in Revitalization Areas as
defined in HUD Notice H-96-81, dated September 30, 1996, and for
properties located outside a Revitalization Area that meet the
exception criteria (the property meets the standards for establishment
of a Revitalization Area and is located in a neighborhood where seller
concessions, such as take-back financing are common and/or a
predominance of other buyers in the area are investor owners) is 50
percent. In addition, both insurable and uninsurable properties, for
this program only, may be purchased on a direct sale basis by the unit
of local government, nonprofit organization or law enforcement officer
in Revitalization Areas and exception areas. Outside of these areas,
law enforcement officers must use the standard sales procedure without
any discount when purchasing from HUD.
It is intended that the full discount be passed on to the law
enforcement officer if the property is first purchased by the unit of
local government or nonprofit organization. If a real estate broker is
engaged to handle the sale of these properties or closing costs are
requested, the discount will be reduced by the amount of the broker's
commission or closing costs paid. The special discount and the sale of
properties directly to law enforcement officers under this program will
expire on August 11, 1998.
This program is an extension of the current sales program. The
procedures for implementing this program are as follows:
Upon an expression of interest to participate in this program by a
government entity, nonprofit organization or law enforcement officer,
the HUD Field Office will provide a listing of all newly acquired
insurable and uninsurable properties available in the designated area
of interest.
2. Where feasible, HUD Field Offices will invite interested law
enforcement officers into the office for a face to face discussion of
how the program operates in regard to property availability, discount,
how to prepare and submit a sales contract, the role of a real estate
broker if they choose to use one and how to view properties. If an
office visit is not convenient, the local office representative will
thoroughly explain the procedure over the telephone and provide
detailed written information.
3. Normal direct sales procedures apply under this program.
Interested parties must notify HUD of their preliminary interest within
5 days of property notification.
4. Governmental entities and nonprofit organizations purchasing
properties with the intent of resale to law enforcement officers should
so designate those specific properties when an interest to purchase is
expressed to HUD. At the time the sales contract is submitted, the
government agency or nonprofit must indicate if FHA-insured financing
is desired.
5. To avoid the need for dual closings and the cost associated with
each, Field Offices will allow the governmental entity or the nonprofit
organization to assign the sales contract to the law enforcement
officer.
6. To make the properties more affordable in those instances where
an FHA-insured mortgage is requested by the law enforcement officer,
the downpayment will be $100.
7. The law enforcement officer must occupy the property as his/her
primary residence for the three year period.
8. The sales closing timeframes established by each HUD Office will
apply to this program.
9. Deed restrictions will apply to these sales.
a. The following clause MUST be added to each deed for properties
purchased by law enforcement officers under this program:
``The purpose of the following covenant is to insure that the
property conveyed herein is used for homeownership and is occupied as a
primary residence by a law enforcement officer in accordance with the
objectives of the Grantor's Officer Next Door Sales Program. Grantee, a
law enforcement officer, shall own and occupy, as a primary residence,
the property conveyed herein. This covenant shall be subject and
subordinate to any mortgage or deed of trust executed by Grantee to
finance or refinance the acquisition of the property conveyed herein
and shall be extinguished upon the foreclosure of such mortgage or the
conveyance of the property by deed in lieu of foreclosure. The
covenants and conditions contained in this paragraph shall terminate,
shall be of no further effect, and shall not be enforceable on or after
[date of third year anniversary of closing] or unless terminated
earlier in writing by Grantor. The acceptance of this deed by the
[[Page 1887]]
Grantee shall constitute an acceptance of the use restrictions
described in this paragraph.''
b. In those instances where a nonprofit organization or a unit of
local government purchases and closes the sale, the following clause
must be provided to the nonprofit organization or a unit of local
government for inclusion as a restriction in their deed to the law
enforcement officer:
``The purpose of the following covenant is to insure that the
property conveyed herein is used for homeownership and is occupied as a
primary residence by a law enforcement officer in accordance with the
objectives of the U.S. Department of Housing and Urban Development's
(HUD's) Officer Next Door Sales Program. Grantee, a law enforcement
officer, shall own and occupy, as a primary residence, the property
conveyed herein. This covenant shall be subject and subordinate to any
mortgage or deed of trust executed by Grantee to finance or refinance
the acquisition of the property conveyed herein and shall be
extinguished upon the foreclosure of such mortgage or the conveyance of
the property by deed in lieu of foreclosure. The covenants and
conditions contained in this paragraph shall terminate, shall be of no
further effect, and shall not be enforceable on or after [date of third
year anniversary of closing] or unless terminated earlier in writing by
HUD. The acceptance of this deed by the Grantee shall constitute an
acceptance of the use restrictions described in this paragraph.''
III. Paperwork Reduction Act Statement
The information collection requirements contained in this Notice
have been approved by the Office of Management and Budget (OMB) in
accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-
3520), and assigned OMB control number 2502-0521. An agency may not
conduct or sponsor, and a person is not required to respond to, a
collection of information unless the collection displays a valid
control number.
IV. Environmental Impact
This notice is subject to, and does not alter the environmental
requirements of regulations in 24 CFR part 291. Accordingly, under 24
CFR 50.19(c)(5), this notice is categorically excluded from
environmental review under the National Environmental Policy Act of
1969 (42 U.S.C. 4321). The environmental review provisions for the
disposition of HUD-acquired single family property are in 24 CFR
291.100(e).
Authority: 12 U.S.C. 1709 and 1715b.
Dated: January 5, 1998.
Nicolas P. Retsinas,
Assistant Secretary for Housing-Federal Housing Commissioner.
[FR Doc. 98-669 Filed 1-9-98; 8:45 am]
BILLING CODE 4210-27-P