§ 206.134. Partial release, addition or substitution of security.
277 words·~1 min read·
/us/cfr/t24/s§ 206.134·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
(a)A mortgagee shall not release the security or any part thereof, while the mortgage is insured, without the prior consent of the Commissioner.
(b)A mortgagee may, with the prior consent of the Commissioner, accept an addition to, or substitution of, security for the purpose of removing the dwelling to a new lot or replacing the dwelling with a similar or like kind on the existing lot under the following conditions:
(1)The mortgagee obtains a good and valid first lien on the property to which the dwelling is removed or the existing lot upon which the dwelling is rebuilt;
(2)All damages to the structure are repaired or all rebuilding of the structure is completed without cost to FHA; and
(3)The property to which the dwelling is removed or rebuilt is in an area known to be reasonably free from natural hazards or, if in a flood zone, the borrower will insure or reinsure under the National Flood Insurance Program or obtain equivalent private flood insurance coverage, as defined in § 203.16a of this chapter.
(c)A mortgagee may, without the prior consent of the Commissioner, accept an addition to, or substitution of, security for the purpose of removing the dwelling to a new lot under the following conditions:
(1)The dwelling has survived an earthquake or other disaster with little damage, but continued location on the property might be hazardous;
(2)The conditions stated in paragraph
(b)of this section exist; and
(3)Immediately following the emergency removal the mortgagee notifies the Commissioner of the reasons for removal. \[82 FR 7117, Jan. 19, 2017, as amended at 87 FR 70744, Nov. 21, 2022\]