WEST virginia legislature
2023 regular session
Committee Substitute
for
Senate Bill 616
By Senators Weld and Deeds
[Originating in the Committee on Military; reported on February 21, 2023]
A BILL to amend the Code of West Virginia, 1931, as amended, by adding thereto a new article, designated §31-18F-1, §31-18F-2, §31-18F-3, §31-18F-4, §31-18F-5, and §31-18F-6; and to amend and reenact §36-8-13 of said code, all relating generally to creating the West Virginia Veterans’ Home Loan Mortgage Program of 2023; establishing a fund known as the West Virginia Veterans’ Home Loan Mortgage Fund; declaring the purpose of the fund; providing that the Housing Development Fund shall administer the fund; setting forth terms of the program; authorizing the Housing Development Fund to make certain mortgage loans from the fund; and authorizing the unclaimed property administrator to transfer a certain amount from the Unclaimed Property Trust Fund to the fund.
Be it enacted by the Legislature of West Virginia:
This article shall be known as the West Virginia Veterans’ Home Loan Mortgage Program Act of 2023.
As used in this section, the following definitions apply:
(1) "Eligible veteran" means an individual who is a West Virginia resident and who:
(a) Is a member of the West Virginia National Guard;
(b) Is a member of the federal reserve forces of the armed forces of the United States, serving pursuant to Title 10 of the United States Code;
(c) Is serving on federal active duty pursuant to Title 10 of the United States Code;
(d) Is an unremarried spouse of an individual who was otherwise an eligible veteran and was killed in the line of duty;
(e) Is a child of an individual who was otherwise an eligible veteran and was killed in the line of duty;
(f) Is an eligible veteran as defined by rule promulgated by the West Virginia Housing Development Fund; or
(g) Was previously a member of the armed forces pursuant to subdivisions (a), (b), or (c) and was discharged under honorable conditions.
(h) An individual who meets the requirements of paragraph (a), (b), (c), (f), or (g) of this subdivision 2 of this article, and who is establishing their primary residence in West Virginia, and is purchasing a home in this state for the first time.
(2) "First-time home buyer" means an individual determined by the fund to be a first-time home buyer pursuant to rules adopted by the fund.
(3) "Fund" means the West Virginia Veterans’ Home Loan Mortgage Fund.
(4) "Mortgage loan" means a loan for the purchase of real property with any improvements located within this state that is to be used for primary residential purposes by the eligible veteran and that is based upon a written instrument approved by a federal agency, and that is secured by a deed of trust.
(5) "Participating financial institution" means a corporate lender or other loan originator approved by the West Virginia Housing Development Fund for originating loans pursuant to this article.
(6) "Resident" means an individual who maintains, or will maintain after receiving a mortgage loan, a primary residence within West Virginia, and who has not established a residence elsewhere even though the individual may be temporarily absent from the state.
(7) "Under honorable conditions" means a discharge or separation from military duty characterized by the armed forces as under honorable conditions. The term includes honorable discharge and general discharge. The term does not include a dishonorable discharge, or another administrative discharge characterized by military regulation as other than honorable.
(8) "Veterans’ home loan mortgage program" or "program" means the program created in §31-18F-1 et seq. of this code.
(a) There is hereby created by this article, the West Virginia Veterans’ Home Loan Mortgage Program of 2023 under the direction and management of the West Virginia Housing Development Fund for eligible veterans who are first-time home buyers.
(b) The West Virginia Housing Development Fund is authorized to purchase mortgage loans from participating financial institutions pursuant to this article or through direct origination.
(a) Interest on a home mortgage loan made pursuant to this section must be charged at 1 percent less than the federal national mortgage association’s delivery rate or 1 percent lower than the West Virginia Housing Development Fund’s Homeownership Program, whichever is less. If the federal national mortgage association’s rate becomes unavailable, the West Virginia Housing Development Fund shall use another similar rate for the purposes of this section.
(b) The maximum amount of a loan made by the West Virginia Housing Development Fund pursuant to this article is 100 percent of the value of the statewide allowable purchase price determined by the West Virginia Housing Development Fund.
(c) The West Virginia Housing Development Fund shall require as a condition for a loan, that an eligible veteran participate in a first-time home buyer education program approved by the West Virginia Housing Development Fund.
(d) A loan made by the West Virginia Housing Development Fund must be secured by a government guaranty unless the West Virginia Housing Development Fund determines to allow the use of conventional mortgage insurance requirements and coverage.
(e) An eligible veteran shall participate in a loan by contributing a minimum amount of $2,500 unless the West Virginia Housing Development Fund determines otherwise. An eligible veteran may use the minimum contribution toward paying closing costs and may borrow from the Veterans’ Home Loan Mortgage Program the maximum loan amount allowed by the mortgage insurer for the loan.
(f) There is no limit on the maximum amount of income that may be earned by an eligible veteran for the purposes of a loan pursuant to this article.
(g) In order to allow small financial institutions to participate equitably in the program along with large financial institutions, the West Virginia Housing Development Fund may adopt rules to specify the maximum amount of mortgage loans that may be made by any one participating financial institution.
(h) The Legislative Auditor shall have access to all documentation used for the purpose of the program.
(i) The West Virginia Housing Development Fund shall annually submit to the Joint Committee on Government and Finance a report describing, at a minimum, the operation and use of this program. This report shall be due no later than December 1 of each year and may be combined with other reports submitted by the West Virginia Housing Development Fund to the Legislature.
(a) The board of directors of the West Virginia Housing Development Fund may create and establish the West Virginia Veterans’ Home Loan Mortgage Fund to make moneys available to the West Virginia Housing Development Fund for loans that qualify pursuant to this article.
(b) The West Virginia Housing Development Fund shall administer the West Virginia Veterans’ Home Loan Mortgage Fund and service the mortgage loans under the program.
(c) The West Virginia Housing Development Fund shall receive all moneys transferred to the Fund pursuant to §36-8-13(f) of this code, any other moneys to be deposited into the fund, and any repayments and interest paid to the fund.
(d) As a loan pursuant to this article is repaid, the principal payments on the loan must be redeposited in the fund until all of the principal of the loan is repaid. In the event of foreclosure, the proceeds from the sale of the foreclosed property must be deposited to the fund. The fund may be used to cover the initial purchase of the mortgage loans from participating lenders as well as amounts determined by the West Virginia Housing Development Fund, to pay for the origination and servicing release fees of a loan by a participating financial institution and to cover the holding costs of any foreclosed properties. Interest received on the loans may be used by the West Virginia Housing Development Fund to pay the reasonable costs for the administration of the program and servicing of the loans. Remaining interest received on the loan must be deposited into the fund.
(e) Following the initial origination of loans, loan repayments and any interest earnings of the fund may be used by the West Virginia Housing Development Fund to originate additional program loans or to assist in the development of affordable housing units for the benefit of veterans.
(f) The West Virginia Housing Development Fund may invest and reinvest all moneys in the Veterans’ Home Loan Mortgage Fund in any investments authorized under W. Va. Code § 31-18-6, pending the disbursement thereof in connection with the Veterans’ Home Loan Mortgage Fund.
(g) The West Virginia Housing Development Fund will operate the Veterans’ Home Loan Mortgage Fund in accordance with customary practices of mortgage lending and loan servicing, including originating loans through qualified lending institutions, industry standard underwriting, minimum down payments, house purchase prices, mortgage lien position, loan origination, and loan servicing fees similar to the West Virginia Housing Development Fund Homeownership Program or similar program.
(a) The administrator shall record the name and last known address of each person appearing from the holders reports to be entitled to the property, and the name and last known address of each insured person or annuitant and beneficiary and with respect to each policy or annuity listed in the report of an insurance company, its number, the name of the company, and the amount due.
(b) The Unclaimed Property Fund is continued. The administrator shall deposit all funds received pursuant to this article in the Unclaimed Property Fund, including the proceeds from the sale of abandoned property under §36-8-12 of this code. The administrator may invest the Unclaimed Property Fund with the West Virginia Board of Treasury Investments, or the Investment Management Board, and all earnings shall accrue to the fund and are available for expenditure in accordance with the article. In addition to paying claims of unclaimed property duly allowed, the administrator may deduct the following expenses from the Unclaimed Property Fund:
(1) Expenses of the sale of abandoned property;
(2) Expenses incurred in returning the property to owners, including without limitation the costs of mailing and publication to locate owners;
(3) Reasonable service charge; and
(4) Expenses incurred in examining records of holders of property and in collecting the property from those holders.
(c) The Unclaimed Property Trust Fund is continued within the State Treasury. The administrator may invest the Unclaimed Property Trust Fund with the West Virginia Board of Treasury Investments and all earnings shall accrue to the fund and are available for expenditure in accordance with this article. After deducting the expenses specified in subsection (b) of this section and maintaining a sum of money from which to pay claims duly allowed, the administrator shall transfer the remaining moneys in the Unclaimed Property Fund to the Unclaimed Property Trust Fund.
(d) On or before December 15 of each year, notwithstanding any provision of this code to the contrary, the administrator may transfer the sum of $1 million from the Unclaimed Property Trust Fund to the Jumpstart Savings Trust Fund, until an actuary certifies there are sufficient funds to satisfy all obligations and administrative expenses of the Jumpstart Savings Program.
(f) Subject to cash availability, on or before July 15, 2023, the unclaimed property administrator may transfer up to $8 million from the Unclaimed Property Trust Fund to the West Virginia Veterans’ Home Loan Mortgage Fund, as provided in §31-18F-5 of this code.
(g) After transferring any money required by subsections (d), and (e), and (f) of this section, the administrator shall transfer moneys remaining in the Unclaimed Property Trust Fund to the General Revenue Fund.