WAIS Document Retrieval[Code of Federal Regulations]
[Title 24, Volume 2, Parts 200 to 499]
[Revised as of April 1, 2000]
From the U.S. Government Printing Office via GPO Access
[CITE: 24CFR203.378]

[Page 195-196]
 
                 TITLE 24--HOUSING AND URBAN DEVELOPMENT
 
PART 203--SINGLE FAMILY MORTGAGE INSURANCE--Table of Contents
 
               Subpart B--Contract Rights and Obligations
 
Sec. 203.378  Property condition.

    (a) Condition at time of transfer. When the property is transferred, 
or a mortgage is assigned to the Commissioner, the property shall be 
undamaged by fire, earthquake, flood, or tornado, except as set forth in 
this subpart.
    (b) Damage to property by waste. The mortgagee shall not be liable 
for damage to the property by waste committed by the mortgagor, its 
heirs, successors or assigns in connection with mortgage insurance 
claims paid on or after July 2, 1968.
    (c) Mortgagee responsibility. The mortgagee shall be responsible 
for:
    (1) Damage by fire, flood, earthquake, hurricane, or tornado;
    (2) Damage to or destruction of security properties on which the 
loans are in default and which properties are vacant or abandoned, when 
such damage or destruction is due to the mortgagee's failure to take 
reasonable action to inspect, protect and preserve such properties as 
required by Sec. 203.377 of

[[Page 196]]

this part, as to all mortgages insured on or after January 1, 1977; and
    (3) As to all mortgages insured under firm commitments issued on or 
after November 19, 1992, or under direct endorsement processing where 
the credit worksheet was signed by the mortgagee's underwriter on or 
after November 19, 1992, any damage of whatsoever nature that the 
property has sustained while in the possession of the mortgage if the 
property is conveyed to the Secretary without notice to and approval by 
the Secretary as required by Sec. 203.379 of this part.
    (d) Limitation. The mortgagee's responsibility for property damage 
shall not exceed the amount of its insurance claim as to a particular 
property.

[36 FR 34508, Dec. 22, 1971. Redesignated and amended at 41 FR 49735, 
Nov. 10, 1976; 57 FR 47973, Oct. 20, 1992; 58 FR 32057, June 8, 1993; 61 
FR 36265, July 9, 1996; 61 FR 36453, July 10, 1996]



