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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
WASHINGTON, D. C. 20410

November 2, 1978
OFFICE OF THE ASSISTANT SECRETARY FOR
HOUSING-FEDERAL HOUSING COMMISSIONER              IN REPLY REFER TO:
Mortgagee Letter 78-13
TO:  ALL APPROVED MORTGAGEES
SUBJECT:  Amendment to Mortgagee's Certificate, Form FHA-2434
 
     Several mortgagees have brought to our attention the variance
between the strict interpretation of the language contained in
paragraph 5 of the Mortgagee's Certificate, which states that all of
the items enumerated therein have been collected, or will be
collected as of the date of initial endorsement, and the actual
practice in the industry of collecting such items out of the initial
draw.
 
     In order to remove any doubt as to the interpretation of the
language in paragraph 5, mortgagees may hereafter add a footnote to
the Mortgagee's Certificate specifically identifying those specific
fees set forth in paragraph 5 which are to be paid out of the
initial insured draw, thus eliminating any question that the
mortgagee is certifying that those fees have been collected at
initial endorsement.
 
     The Mortgagee's Certificate will be amended to reflect this
change at the next printing.
 
                           Sincerely,
 
                           Lawrence B. Simons
                           Assistant Secretary for
                           Housing-Federal Housing Commissioner
 
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