SEC-704 -- REMOTE RURAL AREAS. 

 
 (a) In General.-Section 502 of the Housing Act of 1949 (42 U.S.C. 1472)
is amended by adding at the end the following new subsection:
 
 "(f) Remote Rural Areas.-
 
 "(1) Loan supplements.-The Secretary may supplement any loan under
this section to finance housing located in a remote rural area with a
grant in an amount not greater than the amount by which the reasonable
land acquisition and construction costs of the security property exceeds
the appraised value of such property.
 
 "(2) Prohibition.-The Secretary may not refuse to make, insure, or
guarantee a loan that otherwise meets the requirements under this
section solely on the basis that the housing involved is located in an
area that is excessively rural in character or excessively remote.".
 
 (b) Regulations.-Not later than the expiration of the 120-day period
beginning on the date of enactment of this Act, the Secretary of
Agriculture shall issue any regulations necessary to carry out the
amendment made by subsection (a).