(a) After the original veteran-purchaser has been in possession
of the tract for at least three years from the date of closing, the contract
of sale and purchase may be transferred in one of the following ways:
(1) the contract may be assigned to an eligible veteran without
any increase in the interest rate.
(2) the contract may be assigned to a non-veteran, a veteran
who has previously participated in the program or a firm or corporation with
an increase in the interest rate. The new rate of interest shall be set by
the board.
(b) The contract may be transferred before the expiration of
the three year period only if the veteran dies, becomes financially incapacitated,
or in the event of an involuntary transfer by court order or proceedings,
such as bankruptcy, sheriff's sale, or divorce. Affidavits, certified copies
of proceedings and other documentation may be requested by the board in connection
with this exception.
(c) If the veteran attempts to transfer, sell, or convey the
property before the three year period has elapsed, the board may forfeit the
account and order the property to be sold. In the alternative, the board may
require that the account be paid in full and a penalty paid, or approve the
unauthorized transfer upon the payment of the penalty and receipt of such
other documentation as may be required. The penalty shall be the difference
between the account's interest rate and the interest rate charged to non-veterans
at the time the unacceptable transfer or conveyance is discovered.
(d) No assignment shall be effective until approved by the
chairman of the board.
(e) Upon request, the board will furnish to the assignor, or
to one designated by him, the forms and information necessary to complete
a transfer.
(f) An assignment will not be approved if it is executed by
an attorney in fact.
(g) If married, the veteran's spouse must join in the assignment.
(h) If the assignor wishes to reserve any interest in the property,
he must obtain the approval of the board prior to the assignment. An assignment
will not be approved if the assignor attempts to reserve any interest in the
contract of sale and purchase.
(i) The board is not responsible for the condition of title
subsequent to the execution of the contract of sale and purchase with the
original veteran-purchaser. The assignee should satisfy himself as to condition
of title before accepting an assignment.
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