Interest rate for veterans assumption
- • variable rate
- • effect of rate on cash flow
- • rules
(1) When a veteran assumes a previous loan under ORS 407.305 (Assumption of previous loan by eligible veteran), the interest rate to be paid by the veteran from the date of assumption shall be the rate per annum prescribed periodically by the Department of Veterans Affairs, taking into consideration the solvency of the loan program and the interest rates currently prevailing in this state for loans secured by owner-occupied residential property.
(2) The department shall make a cash flow projection to determine if assumptions at the interest rate established under subsection (1) of this section are among the causes of a negative cash flow projection for the loan program. The cash flow projection required by this section shall be an estimate of the revenue received from the repayment of mortgages, interest earnings, administrative expenses of the loan program, payment of interest and principal on outstanding debt and other relevant factors during the period in which current outstanding bonds are required to be retired.
(3) If the cash flow projection required under subsection (2) of this section indicates that assumptions of loans at the interest rate established under subsection (1) of this section are a cause of a negative cash flow projection for the loan program, the department, by rule and notwithstanding ORS 407.325 (Rate of interest on loans) (2), shall increase the interest rate to be paid for loans assumed under ORS 407.305 (Assumption of previous loan by eligible veteran) to the lowest rate per annum that assures a positive cash flow projection, but not exceeding the rate then prescribed under ORS 407.325 (Rate of interest on loans). [1982 s.s.1 c.11 §15; 1987 c.221 §5; 1987 c.564 §1; 2005 c.625 §35]
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