Interpretation

1  In this regulation:

"Act" means the Home Mortgage Assistance Program Act;

"eligible mortgage" means a first mortgage that meets the requirements of section 4 or a second mortgage that meets the requirements of section 5;

"eligible mortgagor" means a person who meets the requirements of section 3;

"guarantee" means a guarantee under section 2;

"principal residence" means the usual home in British Columbia of an individual who is permanently resident in British Columbia, where the home is

(a) land that is shown as a single parcel in the records of a land title office and that has, as an improvement, the building in which the individual resides,

(b) a residential strata lot shown in a strata plan registered in a land title office, or

(c) a mobile home;

"purchase price" means the amount that would have been paid in the open market by a willing buyer to a willing seller, neither being under abnormal pressure at the date the actual agreement for sale was entered into;

"resident homeowner" means an individual who is

(a) the registered owner and mortgagor of land on which the individual has a principal residence, or

(b) the registered owner of a mobile home that the owner occupies as the owner's principal residence and which is encumbered by a chattel mortgage.

 Guarantee

2  (1)  The Province may guarantee the repayment of an eligible mortgage by an eligible mortgagor.

(2)  The guarantee shall not exceed the lesser of

(a) $12 000 (plus interest accrued thereon at the rate specified in the eligible mortgage),

(b) in the case of a first mortgage, 50% of the first mortgage, or

(c) in the case of a second mortgage, 100% of the second mortgage.

[am. B.C. Reg. 13/90.]

 Eligible mortgagor

3  A mortgagor is an eligible mortgagor where

(a) the mortgagor is at least 19 years of age and a resident homeowner,

(b) the mortgagor, or, where there is more than one mortgagor, one of the mortgagors

(i)  has continuously resided in British Columbia for 2 years immediately preceding the purchase of the residence, or

(ii)  currently is a Canadian citizen or permanent resident of Canada and

(a) was born in British Columbia, or

(b) resided in British Columbia for any 5 consecutive years,

(c) neither the mortgagor nor anyone else, who together with the mortgagor is registered in a land title office as owner of the residence, has received any assistance from the Province to purchase a home or principal residence under this regulation or under the Provincial Home Acquisition Act, the Home Purchase Assistance Act or the Home Conversion and Leasehold Loan Act, and

(d) the mortgagor purchased the residence on or after June 15, 1989.

 Eligible first mortgage

4  A first mortgage, or, in the case of a mobile home, a first mortgage or a chattel mortgage, is an eligible mortgage where it is

(a) on the principal residence of the mortgagor and

(i)  the purchase price of the residence does not exceed $100 000,

(ii)  the down payment for the residence is at least 5% of the purchase price or $2 000, whichever is greater,

(iii)  the residence is covered by fire insurance, and

(iv)  the residence is held by the mortgagor other than under an agreement for sale, conditional sales agreement or lease,

(b) structured so that each mortgage payment reduces the outstanding principal,

(c) registered in a land title office in the Province or, in the case of a mobile home, in the mobile home registry office, and

(d) with a mortgagee who, at the time the guarantee takes effect, has entered into an agreement under section 4 of the Act that provides for the issuance of guarantees in accordance with the Act and this regulation.

 Eligible second mortgage

5  A second mortgage is an eligible mortgage where

(a) the second mortgage

(i)  complies with section 4, and

(ii)  is not being assumed by the purchaser of the residence, and

(b) the first mortgage

(i)  is not guaranteed under the Act or this regulation, and

(ii)  is assumed by the second mortgagor.

 Application

6  (1)  No guarantee shall be made unless all documents and proofs required by the minister are submitted by the person applying for the guarantee.

(2)  No person shall make, participate in, assent to or acquiesce in the making of a statement that the person knows is false or deceptive in a document, proof or application under subsection (1).

 Assumptions

7  Where a mortgage that is guaranteed under this regulation is assumed the guarantee ceases unless

(a) the mortgage is a first mortgage,

(b) the person assuming the mortgage is an eligible mortgagor, and

(c) the mortgage is an eligible mortgage in relation to the person assuming the mortgage.

 Transfers

8  (1)  Where a mortgage that is guaranteed under this regulation is transferred to a new mortgagee, the guarantee ceases unless the application to transfer is made by the mortgagor to the minister and the application is approved by the minister.

(2)  The minister shall approve the application to transfer the mortgage where

(a) the principal of the mortgage remains the same, and

(b) the new mortgagee has entered into an agreement under section 4 of the Act that provides for the issuance of guarantees in accordance with the Act and this regulation.

 Sale

9  Subject to section 7, a guarantee ceases to exist when title to the mortgaged residence is transferred, the mortgage is discharged or the personal covenant on the mortgage is released.

 Offence

10  (1)  A person who contravenes section 6 (2) commits an offence.

(2)  A person who commits an offence is liable to a fine of not more than $2 000 or to imprisonment for not more than 6 months, or to both.