Regulations last checked for updates: Nov 22, 2024

Title 13 - Business Credit and Assistance last revised: Nov 20, 2024
§ 120.394 - What are the eligible uses of proceeds?

A Borrower must use the loan proceeds solely to acquire, construct or substantially rehabilitate an individual residential or commercial building for sale. “Substantial” means rehabilitation expenses of more than one-third of the purchase price or fair market value at the time of the application. A Borrower may use up to 33 percent of the proceeds to acquire land, and up to 5 percent for community improvements such as curbs and sidewalks.

[61 FR 3235, Jan. 31, 1996, as amended at 82 FR 39503, Aug. 21, 2017]
authority: 15 U.S.C. 634(b) (6), (b) (7), (b) (14), (h), and note, 636(a), (h) and (m), 650, 687(f), 696(3) and (7), and 697(a) and (e); sec. 521, Pub. L. 114-113, 129 Stat. 2242; sec. 328(a), Pub. L. 116-260, 134 Stat. 1182
source: 61 FR 3235, Jan. 31, 1996, unless otherwise noted.
cite as: 13 CFR 120.394