Rules and Regulations
promulgated
under the
Investment Company Act of 1940
Rule 28b-1 -- Investment in Loans Partially or Wholly Guaranteed Under the Servicemen's Readjustment Act of 1944, as Amended
The term qualified investments as used
in section 28(b) of the Investment Company
Act of 1940 shall include:
Any loan, any portion of which is guaranteed under
Title III of the Servicemen's Readjustment Act of 1944, as amended, and which
is secured by a first lien on real estate: Provided, The amount of the
loan not so guaranteed does not exceed 66-2/3 percent of the reasonable value
of such real estate as determined by proper appraisal made by an appraiser designated
by the Administrator of Veterans' Affairs;
Any secondary loan the full amount of which is
guaranteed under section 505(a) of Title III of the above mentioned act and which
is secured by a second lien on real estate:
Provided, however, That any such loan shall be deemed a qualified investment
only so long as
insurance policies are required to be procured
and maintained in an amount sufficient to protect the security against the risks
or hazards to which it may be subjected to the extent customary in the locality,
and
the loan shall remain guaranteed under Title
III of the Servicemen's Readjustment Act of 1944, as amended, to the extent specified
in paragraph (a) (1) or (2) of this section, as the case may be.
Loans made pursuant to this section shall be valued
at the original principal amount of the loan less all payments made thereon which
have been applied to the reduction of such principal amount.
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