PUBLIC LAWS-CH. 31-MAR . 28 , 1941 Refund of current unearned premium charges. Contract conclusive evidence of eligibility; validity. Foreclosures; pay- ment ofinsurance. Conditions. Termination of ob- ligation to pay pre- mium charges. I)ebentures and cer. tificates of claim. Value of mortgage, determination. Proviso. Cost of foreclosure included in debenture. in his discretion to require the payment by the mortgagee of an adjusted premium charge in such amount as the Administrator deter- mines to be equitable, but not in excess of the aggregate amount of the premium charges that the mortgagee would otherwise have been required to pay if the mortgage had continued to be insured under this section until such maturity date; and in the event that the prin- cipal obligation is paid in full as herein set forth, and a mortgage on the same property is accepted for insurance at the time of such pay- ment, the Administrator is authorized to refund to the mortgagee for the account of the mortgagor all, or such portion as he shall determine to be equitable, of the current unearned premium charges theretofore paid. "(d) Any contract of insurance heretofore or hereafter executed by the Administrator under this title shall be conclusive evidence of the eligibility of the mortgage for insurance, and the validity of any contract of insurance so executed shall be incontestable in the hands of an approved mortgagee from the date of the execution of such contract, except for fraud or misrepresentation on the part of such approved mortgagee. "SEc. 604. (a) In any case in which the mortgagee under a mort- gage insured under this title shall have foreclosed and taken posses- sion of the mortgaged property, in accordance with regulations of, and within a period to be determined by, the Administrator, or shall, with the consent of the Administrator, have otherwise acquired such property from the mortgagor after default, the mortgagee shall be entitled to receive the benefit of the insurance as hereinafter provided, upon (1) the prompt conveyance to the Administrator of title to the property which meets the requirements of rules and regulations of the Administrator in force at the time the mortgage was insured, and which is evidenced in the manner prescribed by such rules and regu- lations; and (2) the assignment to him of all claims of the mortgagee against the mortgagor or others, arising out of the mortgage trans- action or foreclosure proceedings, except such claims as may have been released with the consent of the Administrator. Upon such conveyance and assignment the obligation of the mortgagee to pay the premium charges for insurance shall cease and the Administrator shall, subject to the cash adjustment hereinafter provided, issue to the mortgagee debentures having a total face value equal to the value of the mortgage and a certificate of claim, as hereinafter provided. For the purposes of this subsection, the value of the mortgage shall be determined, in accordance with rules and regulations prescribed by the Administrator, by adding to the amount of the original prin- cipal obligation of the mortgage which was unpaid on the date of the institution of foreclosure proceedings, or on the date of the acqui- sition of the property after default other than by foreclosure, the amount of all payments which have been made by the mortgagee for taxes, ground rents, and water rates, which are liens prior to the mortgage, special assessments which are noted on the application for insurance or which become liens after the insurance of the mortgage, insurance of the mortgaged property, and any mortgage insurance premiums paid after either of such dates and by deducting from such total amount any amount received on account of the mortgage after either of such dates, and any amount received as rent or other income from the property, less reasonable expenses incurred in han- dling the property, after either of such dates: Provided, That with respect to mortgages which are foreclosed before there shall have been paid on account of the principal obligation of the mortgage a sum equal to 10 per centum of the appraised value of the property 58 [55 STAT.
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