Is 49 CFR 24.401(d) and Appendix A, Section 24.401(d) consistent as it relates to the amount and term of the replacement mortgage required to receive the full amount of the increased mortgage interest payment?
Yes. The increased mortgage interest payment (also known as the mortgage interest differential, MIDP or MID) is based upon the unpaid mortgage balance on the displacement dwelling. The intent of Appendix A is to recognize the increased mortgage interest cost and provide a payment that will reduce the replacement mortgage balance in accordance with 49 CFR 24.401(d). 49 CFR 24.401(d)(5) provides that the agency shall inform the displaced person of the approximate amount of the MIDP payment and the conditions that must be met in order to receive the full amount of the payment. Each agency must develop appropriate measures to ensure proper documentation of increased mortgage interest expense. If the replacement mortgage is less than the calculated buydown amount, the payment is pro-rated and reduced accordingly. The formula to determine the reduced buydown payment is: The (actual mortgage divided by the calculated mortgage amount) multiplied by the calculated buydown amount. An example of
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