republic-os/legal/us/code/title-12/chapter-13/section-1715z-16.md

type, title, description, jurisdiction, corpus, kind, title_number, title_name, chapter_number, chapter_name, section, citation, status, release_point, release_date, source, source_url, source_identifier, source_file, source_hash, raw_snapshot_hash, text_hash, retrieved_at, confidence, tags

type	title	description	jurisdiction	corpus	kind	title_number	title_name	chapter_number	chapter_name	section	citation	status	release_point	release_date	source	source_url	source_identifier	source_file	source_hash	raw_snapshot_hash	text_hash	retrieved_at	confidence	tags
LegalText	12 U.S.C. § 1715z–16	Adjustable rate single family mortgages	us	united_states_code	code_section	12	BANKS AND BANKING	13	NATIONAL HOUSING	1715z–16	12 U.S.C. § 1715z–16	current	119-100	2026-06-26	official	https://uscode.house.gov/download/releasepoints/us/pl/119/100/xml_usc12@119-100.zip	/us/usc/t12/s1715z–16	data/legal/raw/us/code/title-12/usc12.xml	7fe29477f60b9d90d5935ff13677e52873364c2a229da20af0f032f41051a720	e6b98700ef4156ac33fde5d105824845d727afa91a53f3762be2cf4d1a3b01fa	d6c86e55cec6332a97bcf41737463edf2f2fde2c4c4a987c37da1b7f2a51d979	2026-07-04	official	legal us-code

12 U.S.C. § 1715z–16 - Adjustable rate single family mortgages

Text

(a) One- to four-family dwellings; maximum term of mortgage; adjustments in effective rate of interest The Secretary may insure under any provision of this subchapter a mortgage involving property upon which there is located a dwelling designed principally for occupancy by one to four families, where the mortgage provides for periodic adjustments by the mortgagee in the effective rate of interest charged. Such interest rate adjustments may be accomplished through adjustments in the monthly payment amount, the outstanding principal balance, or the mortgage term, or a combination of these factors, except that in no case may any extension of a mortgage term result in a total term in excess of 40 years. Adjustments in the effective rate of interest shall correspond to a specified national interest rate index approved in regulations by the Secretary, information on which is readily accessible to mortgagors from generally available published sources. Adjustments in the effective rate of interest shall (1) be made on an annual basis; (2) be limited, with respect to any single interest rate increase, to no more than 1 percent on the outstanding loan balance; and (3) be limited to a maximum increase of 5 percentage points above the initial contract interest rate over the term of the mortgage.

(b) Written explanation of mortgage features The Secretary shall require that the mortgagee make available to the mortgagor, at the time of loan application, a written explanation of the features of an adjustable rate mortgage consistent with the disclosure requirements applicable to variable rate mortgages secured by a principal dwelling under the Truth in Lending Act [15 U.S.C. 1601 et seq.].

(c) Number of mortgages and loans The aggregate number of mortgages and loans insured under this section in any fiscal year may not exceed 30 percent of the aggregate number of mortgages and loans insured by the Secretary under this subchapter during the preceding fiscal year.

(d) Adjustable rate mortgage with initial fixed rate of interest (1) The Secretary may insure under this subsection a mortgage that meets the requirements of subsection (a), except that the effective rate of interest—

(A) shall be fixed for a period of not less than the first 3 years of the mortgage term;

(B) shall be adjusted by the mortgagee initially upon the expiration of such period and annually thereafter; and

(C) in the case of the initial interest rate adjustment, is subject to the 1 percent limitation only if the interest rate remained fixed for 3 or fewer years.

(2) The disclosure required under subsection (b) shall be required for a mortgage insured under this subsection.

(June 27, 1934, ch. 847, title II, § 251, as added Pub. L. 98–181, title I [title IV, § 443], Nov. 30, 1983, 97 Stat. 1225; amended Pub. L. 100–242, title IV, § 415(a), Feb. 5, 1988, 101 Stat. 1907; Pub. L. 107–73, title II, § 206, Nov. 26, 2001, 115 Stat. 674; Pub. L. 108–186, title III, § 301(a), Dec. 16, 2003, 117 Stat. 2692.)

Notes

Editorial Notes

References in TextThe Truth in Lending Act, referred to in subsec. (b), is title I of Pub. L. 90–321, May 29, 1968, 82 Stat. 146, which is classified generally to subchapter I (§ 1601 et seq.) of chapter 41 of Title 15, Commerce and Trade. For complete classification of this Act to the Code, see Short Title note set out under section 1601 of Title 15 and Tables.

Amendments2003—Subsec. (d)(1)(C). Pub. L. 108–186 substituted “3” for “five” 2001—Subsec. (b). Pub. L. 107–73, § 206(1), substituted “require that the mortgagee make available to the mortgagor, at the time of loan application, a written explanation of the features of an adjustable rate mortgage consistent with the disclosure requirements applicable to variable rate mortgages secured by a principal dwelling under the Truth in Lending Act” for “issue regulations requiring that the mortgagee make available to the mortgagor, at the time of loan application, a written explanation of the features of the adjustable rate mortgage, including a hypothetical payment schedule that displays the maximum potential increases in monthly payments to the mortgagor over the first 5 years of the mortgage term”. Subsec. (d). Pub. L. 107–73, § 206(2), added subsec. (d). 1988—Subsec. (c). Pub. L. 100–242 amended subsec. (c) generally. Prior to amendment, subsec. (c) read as follows: “The aggregate number of mortgages and loans insured under this section, section 1715z–10(c) of this title, and section 1715z–17 of this title in any fiscal year may not exceed 10 percent of the aggregate number of mortgages and loans insured by the Secretary under this subchapter during the preceding fiscal year.”

Statutory Notes and Related Subsidiaries

Effective Date of 2003 AmendmentPub. L. 108–186, title III, § 301(b), Dec. 16, 2003, 117 Stat. 2692, provided that: “The amendment made by subsection (a) [amending this section] shall apply to mortgages executed on or after the date of the enactment of this title [Dec. 16, 2003].”