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B-182482 1 (1975-08-04)

handle is hein.gao/gaobadckk0001 and id is 1 raw text is: . THE COMPTROLLER GENERAL DIECISION ' OF THE UNITED STATES WASHINGTON. D.C. 2054e f973; FILE: B-182482 DATE: G 197 MATTER OF: Insurability of note under Title I of National Housing Act. DIGEST: Since note dated May 1, 1970, submitted for insurance pursuant to Title I of National Housing Act contained projected maturity date 17-days in excess of 7 year and 32-days maximum that was prescribed by statute when loan was made, claim submitted by bank--which is primarily responsible for assuring that term of note does not exceed statutory limitation--for reimbursement of its loss on note must be denied. Although note was not assigned to bank or funds dis- bursed thereby until May 19, 1970, statute specifically limits term of obligation or note underlying loan and makes no provision for exceptions. See B-172121, April 12, 1971. Mr. B. C. Tyner, Authorized Certifying Officer, Department of Housing and Urban Development (ELU1D) has requested our advice con- cerning the propriety of his certifying for payment a voucher in the amount of $2,566.55 covering a claim by the Security National Bank of Melville, New York, for reimbursement of a loss sustained on the note of Sylvester and Nilda Baez which was submitted to HUD for insurance pursuant to Title I of the National Housing Act as amended 12 U.S.C. 5 1701 et seq. The bank's claim was initially denied by HUD because the term of the note was in excess of the statutory maximum of 7 years and 32 days that was in effect at the time the loan was made. The pertinent facts and circumstances concerning this matter as disclosed in the certifying officer's letter are set forth below. The note in question is dated May 1, 1970, and provides for 84 monthly installments of $79.72 each beginning on July 19, 1970. This repayment schedule projects the maturity date of the note to June 19, 1977, making the term of the note 7 years and 49 days. The note was payable to the contractor, the B. Hammer Co., Ltd., and on May 19, 1970, it was purchased by the Security National Bank. When tbe loan was entered into, section 2(b) of the National Housing Act, as amended, 12 U.S.C. I 1703(b) read as follows: PULISD DECISION S Coemp. Gen. ........

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