ORS Chapter 407

Chapter 407 — VeteransLoans

 

2009 EDITION

 

 

VETERANSLOANS

 

BENEFITSOF VETERANS AND SERVICE PERSONNEL

 

GENERALPROVISIONS

 

407.075     Purpose;legislative intent

 

407.085     Definitions

 

407.095     Policyagainst foreclosure; rules

 

407.115     Administrationof loan program; rules

 

407.125     Loansto qualified person

 

407.131     Discountof principal; rules

 

407.135     Authorityof department; disposition of certain moneys

 

407.145     Purchaseand control of property; disbursements to protect security

 

407.155     Executionand custody of documents

 

407.165     Authorityto hold certain funds received from borrower

 

407.169     Escrowaccounts; standards; interest; rules

 

407.177     Loanprocessing and servicing contracts with lending institutions; terms; procedures

 

407.179     Additionalpowers delegated to lending institution; authority retained by department

 

407.181     Authorityof lending institution

 

407.185     Cashflow projection; annual review; report

 

407.195     Loansnot being amortized; identification; notice to borrowers

 

407.201     Requireddisclosure of credit information and loan terms

 

LOANPROCEDURES AND CONDITIONS

 

407.205     Applicationfor loan; amount of loan; limit on number of loans; exception

 

407.215     Loantransferred by annulment or dissolution judgment excluded in determiningmaximum allowable

 

407.225     Investigationand processing of loan application; security; maximum amounts of loans

 

407.265     Loansfor home or farm improvements; terms and conditions

 

407.275     Termsof loan to veteran and transferee

 

407.285     Rateof interest payable by certain transferees

 

407.295     Transferto spouse; notice to department; notice of delinquent payment

 

407.305     Assumptionof previous loan by eligible veteran; additional funds

 

407.315     Interestrate for veteran’s assumption; variable rate; effect of rate on cash flow;rules

 

407.325     Rateof interest on loans

 

407.327     Departmentto prescribe fixed or variable interest rates

 

407.335     Rateof interest payable by transferee; limit on transfers; rules

 

407.349     Latecharges authorized for periodic payments

 

407.375     Saleof foreclosed properties; improvement in lieu of down payment; interest rate;redemption of property; rules

 

407.377     Saleor management of foreclosed property under personal services contract

 

407.385     Prohibitionagainst using loan for purpose other than farm or home acquisition; prompt useof farm or home as principal residence; extension; exception; penalty

 

GENERALOBLIGATION BONDS

 

407.415     Issuanceof bonds

 

407.425     Factorsconsidered before requesting bond issuance

 

407.435     Issuanceof bonds for tax payment; conditions; term

 

LIFEAND MORTGAGE INSURANCE

 

407.465     Loancancellation life insurance

 

407.475     Personsinsurable under ORS 407.465

 

407.480     Definitionsfor ORS 407.480 to 407.490

 

407.485     Agreementsfor mortgage insurance; terms; amount; required coverage

 

407.490     Mortgageinsurance claims; liability of department

 

FINANCES

 

407.495     OregonWar Veterans’ Fund; sources; uses

 

407.505     Loanmoneys to be reserved for borrower prior to loan commitment

 

407.515     OregonWar Veterans’ Bond Sinking Account; sources; use

 

407.525     Transferof sinking account moneys to veterans’ fund; retransfer

 

407.555     Auditingand payment of claims

 

407.565     Revolvingaccount

 

VETERANS’SMALL BUSINESS REPAIR LOAN PROGRAM

 

407.582     Establishmentof program; eligibility; rules

 

407.585     Veterans’Small Business Repair Loan Fund

 

MISCELLANEOUS

 

407.595     Loansnot subject to execution or assignment

 

                        407.010 [Amended by1975 c.219 §1; 1977 c.383 §6; subsection (3) enacted as 1977 c.383 §9; 1979c.176 §1; 1981 c.661 §1; 1982 s.s. 1 c.11 §10; 1983 c.445 §1; renumbered407.085]

 

      407.020 [Amended by1967 c.245 §1; 1971 c.221 §2; renumbered 407.115]

 

      407.030 [Amended by1977 c.383 §8; renumbered 407.125]

 

      407.035 [1981 c.659 §7;renumbered 407.505]

 

      407.040 [Amended by1953 c.97 §2; 1957 c.125 §1; 1963 c.163 §1; 1965 c.269 §1; 1967 c.112 §1; 1969c.615 §1; 1971 c.221 §3; 1973 c.574 §1; 1975 c.6 §1; 1975 c.263 §1; 1977 c.676 §3;1979 c.177 §1; 1981 c.604 §1; 1982 s.s.1 c.11 §12; 1983 c.387 §1; renumbered407.205]

 

      407.042 [1981 c.366 §2;renumbered 407.385]

 

      407.043 [1977 c.676 §2;renumbered 407.397]

 

      407.045 [1969 c.523 §1;renumbered 407.215]

 

      407.048 [1977 c.315 §2;1981 c.628 §1; 1982 s.s.1 c.11 §13; 1983 c.445 §4; renumbered 407.255]

 

      407.050 [Amended by1957 c.125 §2; 1971 c.221 §4; 1973 c.574 §2; 1975 c.219 §2; renumbered 407.225]

 

      407.055 [1977 c.383 §1;1981 c.565 §3; 1983 c.445 §5; renumbered 407.175]

 

      407.058 [1977 c.383 §3;1983 c.445 §6; renumbered 407.235]

 

      407.060 [Repealed by1971 c.743 §432]

 

      407.061 [1977 c.383 §4;1983 c.445 §7; renumbered 407.245]

 

      407.063 [1981 c.387 §1;1982 s.s.1 c.11 §14; renumbered 407.305]

 

      407.065 [1979 c.176 §3;renumbered 407.265]

 

      407.070 [Amended by1955 c.151 §1; 1957 c.125 §3; 1969 c.615 §5; 1971 c.221 §5; 1975 c.219 §3; 1977c.676 §4; 1981 c.387 §2; 1982 s.s.1 c.11 §17; renumbered 407.275]

 

      407.072 [1969 c.615 §3;1971 c.221 §6; 1975 c.219 §4; 1977 c.645 §1; 1981 c.659 §5; renumbered 407.325]

 

      407.073 [1969 c.615 §4;1971 c.221 §7; 1977 c.676 §5; 1983 c.420 §3; renumbered 407.335]

 

      407.074 [1955 c.102 §§2,3,7;1975 c.219 §5; 1979 c.238 §1; renumbered 407.465]

 

GENERALPROVISIONS

 

      407.075Purpose; legislative intent. (1) The provisions of this chapter areintended to carry out the purposes of Article XI-A of the Oregon Constitution.The Legislative Assembly recognizes that its authority to define the scope andpurpose of this chapter is limited by the purposes expressed in Article XI-A.

      (2)The primary purpose of this chapter is to provide loan funds to qualifyingOregon veterans for the acquisition or improvement of farms and homes. TheLegislative Assembly does not intend, by any past or present enactment, toestablish as a principal purpose of this chapter the providing of subsidizedenergy financing. [1983 c.445 §9]

 

      Note: 407.075 wasenacted into law by the Legislative Assembly but was not added to or made apart of ORS chapter 407 or any series therein by legislative action. SeePreface to Oregon Revised Statutes for further explanation.

 

      407.076 [1955 c.102 §§4,5,6;1969 c.433 §1; 1979 c.35 §1; 1979 c.238 §2; renumbered 407.475]

 

      407.080 [Amended by1975 c.219 §6; renumbered 407.135]

 

      407.085Definitions.(1) As used in Article XI-A, Oregon Constitution, and this chapter, for thepurposes of administration:

      (a)“Acquisition” means:

      (A)Purchase and improvement of a home or farm.

      (B)Payment of the balance of the purchase price and interest on a purchasecontract, and the improvement of property thereby acquired.

      (C)Refinance of an existing purchase-money mortgage or mortgage in the naturethereof, and the improvement of property thereby purchased.

      (D)Improvement of a home or farm.

      (b)“Bonds” includes, but is not limited to, serial bonds, term bonds, notes,obligations, lines of credit, revolving credit agreements, loans, financingagreements or other evidence of indebtedness determined by the Department ofVeterans’ Affairs, with the approval of the State Treasurer, to be necessary ordesirable to provide funds for the purposes expressed in Article XI-A of theOregon Constitution.

      (2)As used in this chapter:

      (a)“Committee” means the Advisory Committee provided for by ORS 406.210.

      (b)“Home” means any residential-type structure, including outbuildings and thereal property in connection with it, if any, including long-term leaseholds,which is established, maintained and used primarily as a principal residence bythe veteran.

      (c)“Improvement” means new construction or any necessary or beneficial additions,alterations or changes appurtenant to the home or farm which protect or improvethe basic livability or energy efficiency of the premises.

      (d)“Mobile home” means a structure, transportable in one or more sections, whichis 10 feet or more in width, and contains more than 500 square feet of livingspace figured on exterior dimensions of the structure, exclusive of any hitchand is designed to be used as a dwelling by one family, and which remains aspersonal property under the laws of this state. [Formerly 407.010; 2001 c.98 §5;2005 c.625 §15]

 

      Note: Section 1,chapter 527, Oregon Laws 2009, does not become effective unless the amendmentto the Oregon Constitution proposed by House Joint Resolution 7 (2009) isapproved by the people at the regular general election held on November 2,2010. If House Joint Resolution 7 (2009) is approved by the people, section 1,chapter 527, Oregon Laws 2009, becomes effective January 1, 2011. See section2, chapter 527, Oregon Laws 2009. Section 1, chapter 527, Oregon Laws 2009,provides:

      Sec.1.As used in section 3, Article XI-A of the Oregon Constitution, “veteran” meansa person who:

      (1)Served on active duty with the Armed Forces of the United States:

      (a)For a period of more than 90 consecutive days beginning on or before January31, 1955, and was discharged or released from active duty under honorableconditions;

      (b)For a period of more than 178 consecutive days beginning after January 31,1955, and was discharged or released from active duty under honorableconditions;

      (c)For 178 days or less and was discharged or released from active duty underhonorable conditions because of a service-connected disability;

      (d)For 178 days or less and was discharged or released from active duty underhonorable conditions and has a disability rating from the United States Departmentof Veterans Affairs; or

      (e)For at least one day in a combat zone and was discharged or released fromactive duty under honorable conditions;

      (2)Received a combat, expeditionary or campaign ribbon or medal for service in theArmed Forces of the United States and was discharged or released from activeduty under honorable conditions; or

      (3)Is receiving a nonservice-connected pension from the United States Departmentof Veterans Affairs. [2009 c.527 §1]

 

      407.095Policy against foreclosure; rules. (1) It is the policy of the State ofOregon to make every reasonable attempt to keep a veteran in the home purchasedunder the loan program when the veteran is unabl