COMAR 05.04.01.07. Loan Terms and Conditions — Deferred Loans

A. In addition to the conditions and requirements of Regulation .06 of this chapter , deferred loans for residential buildings of four or fewer units shall meet the requirements in §§B—E of this regulation.

B. Eligibility. The Department may make loans with deferred payments of principal or interest or both principal and interest to:

(1) Single family owner-occupants who are families of very low income and sponsors or nonprofit sponsors of buildings occupied entirely by tenants who are families of very low income; or

(2) As determined by the Secretary, any category of borrowers necessary to achieve the purposes of the Act.

C. Amount of Deferred Payments. Loans may provide for deferred payments of principal or interest, or both principal and interest, to the minimum extent necessary based on a borrower's ability to repay.

D. Repayment. The loan documents shall provide for repayment of deferred amounts at the maturity date or at any earlier date established by the Department, or the local administrator, or upon any sale or other transfer of the building or any interest in the building other than a residential lease of less than 3 years duration. The Department may, but need not, charge interest on the deferred interest.

E. Limitations. The Department may, from time to time, establish limitations on the percentage of allocations and the percentage of the annual funding appropriated to the Program which may be used for no interest and deferred payment loans.