Section 3733 · Property management

(a) (1) Of the number of purchases made during any fiscal year of real property acquired by the Secretary as the result of a default on a loan guaranteed under this chapter for a purpose described in section 3710(a) of this title , not more than 65 percent, nor less than 50 percent, of such purchases may be financed by a loan made by the Secretary. The maximum percentage stated in the preceding sentence may be increased to 80 percent for any fiscal year if the Secretary determines that such an increase is necessary in order to maintain the effective functioning of the loan guaranty program. (2) After September 30, 1990, the percentage limitations described in paragraph (1) of this subsection shall have no effect. (3) The Secretary may, beginning on October 1, 1990, sell any note evidencing a loan referred to in paragraph (1)— (A) with recourse; or (B) without recourse, but only if the amount received is equal to an amount which is not less than the unpaid balance of such loan. (4) (A) Except as provided in subparagraph (B), the amount of a loan made by the Secretary to finance the purchase of real property from the Secretary described in paragraph (1) may not exceed an amount equal to 95 percent of the purchase price of such real property. (B) (i) The Secretary may waive the provisions of subparagraph (A) in the case of any loan described in paragraph (5). (ii) A loan described in subparagraph (A) may, to the extent the Secretary determines to be necessary in order to market competitively the property involved, exceed 95 percent of the purchase price. (5) The Secretary may include, as part of a loan to finance a purchase of real property from the Secretary described in paragraph (1), an amount to be used only for the purpose of rehabilitating such property. Such amount may not exceed the amount necessary to rehabilitate the property to a habitable state, and payments shall be made available periodically as such rehabilitation is completed. (6) The Secretary shall make a loan to finance the sale of real property described in paragraph (1) at an interest rate that is lower than the prevailing mortgage market interest rate in areas where, and to the extent, the Secretary determines, in light of prevailing conditions in the real estate market involved, that such lower interest rate is necessary in order to market the property competitively and is in the interest of the long-term stability and solvency of the Veterans Housing Benefit Program Fund established by section 3722(a) of this title . (7) During the period that begins on December 16, 2003, and ends on September 30, 2018, the Secretary shall carry out the provisions of this subsection as if— (A) the references in the first sentence of paragraph (1) to “65 percent” and “may be financed” were references to “85 percent” and “shall be financed”, respectively; (B) the second sentence of paragraph (1) were repealed; and (C) the reference in paragraph (2) to “September 30, 1990,” were a reference to “September 30, 2018,”.