loans to cover the cost of public improvements

loans to cover the cost of public improvements Sec. 112. (a) The second sentence of section 220(h)(1) of the National Housing Act is amended to read as follows: “As used in this subsection— “(A) the term ‘home improvement loan’ means a loan, advance of credit, or purchase of an obligation representing a loan or advance of credit made— “(i) for the purpose of financing the improvement of an existing structure (or in connection with an existing structure) which was constructed not less than ten years prior to the making of such loan, advance of credit, or purchase, and which is used or will be used primarily for residential purposes: Provided, That a home improvement loan shall include a loan, advance, or purchase with respect to the improvement of a structure which was constructed less than ten years prior to the making of such loan, advance, or purchase if the proceeds are or will be used primarily for major structural improvements, or to correct defects which were not known at the time of the completion of the structure or78 Stat. 778which were caused by fire, flood, windstorm, or other casualty; or “(ii) for the purpose of enabling the borrower to pay that part of the cost of the construction or installation of sidewalks, curbs, gutters, street paving, street lights, sewers, or other public improvements, adjacent to or in the vicinity of property owned by him and used primarily for residential purposes, which is assessed against him or for which he is otherwise legally liable as the owner of such property; “(B) the term ‘improvement’ means conservation, repair, restoration, rehabilitation, conversion, alteration, enlargement, or remodeling; and “(C) the term ‘financial institution’ means a lender approved by the Commissioner as eligible for insurance under section 2 or a mortgagee approved under section 203(b) (1).” (b) Section 220(n)(2)(i) of such Act is amended by inserting before the semicolon at the end thereof the following: “, and be limited as required by paragraph (11)”. (c) Section 220(h) of such Act is further amended by adding at the end thereof the following new paragraph: “(11) Notwithstanding any other provision of this Act, no home improvement loan made in whole or in part for the purpose specified in clause (A) (ii) of the second sentence of paragraph (1) shall be insured under this subsection if such loan (or the portion thereof which is attributable to such purpose), when added to the aggregate principal balance of any outstanding loans insured under this subsection or section 203 (k) which were made to the same borrower for the purpose so specified (or the portion of such aggregate balance which is attributable to such purpose), would exceed $10, 000.”