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| This archived statute consolidation is current to November 5, 2001 and includes changes enacted and in force by that date. For the most current information, click here. |
[Updated to September 6, 2000]
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Contents |
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Section |
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1 In this Act:
"approved land" means land
(a) that is approved by the Lieutenant Governor in Council for this Act, and
(b) that is Crown land or land owned by a person approved by the Lieutenant Governor in Council;
"commercial or industrial building" means land shown on a tax roll as a separate parcel for the purposes of land tax under the Taxation (Rural Area) Act, Local Government Act or Vancouver Charter, containing a building capable of being converted into 2 or more eligible residences in accordance with local zoning bylaws, but does not include a strata lot under the Strata Property Act;
"conversion mortgage" means a mortgage under section 5 (3);
"dependant" means a person who is, under the regulations, dependent on another person;
"eligible interest rate" means the interest rate that a mortgagor is required, by the minister under this Act and the regulations, to pay on the outstanding principal of a conversion or leasehold mortgage loan;
"eligible residence" means a dwelling unit that, under the regulations, provides living, sleeping, eating, food preparing and sanitary facilities for a person and the person's dependants;
"family residence" means land shown on a tax roll as a separate parcel for the purposes of land tax under the Taxation (Rural Area) Act, Local Government Act or Vancouver Charter, containing not less than one eligible residence, but does not include a strata lot under the Strata Property Act;
"leasehold mortgage" means a mortgage under section 4 (4);
"mortgagor" includes a person who agrees with the minister to assume a conversion or leasehold mortgage;
"owner" means a registered owner, under the Land Title Act, of an estate in fee simple in land, or of the agreement for sale last registered in the land title office against land;
"specified interest rate" means the interest rate, determined by regulation, specified in a conversion or leasehold mortgage, that a mortgagor is required, under the mortgage, to pay on the outstanding principal of a loan.
2 On behalf of the government and subject to this Act, the minister may do any of the following:
(a) make loans by way of conversion mortgage and leasehold mortgage;
(b) enter into, subject to the regulations, conversion and leasehold mortgages;
(c) exercise the powers the minister considers necessary to enforce a covenant, term, condition or provision in a conversion or leasehold mortgage.
3 (1) On application to the minister under the regulations, and on satisfying the minister that the application complies with this Act and the regulations, a person is entitled to a leasehold mortgage loan, if the person has, at that time, one or more dependants, and is a lessee of approved land on which the person
(a) has completed the construction of an eligible residence that the person and the person's dependants occupy as their ordinary residence,
(b) has agreed to have constructed a dwelling unit that, on completion and occupation by the person and the person's dependants as their ordinary residence, will be an eligible residence, or
(c) is constructing a dwelling unit that, on completion and occupation by the person and the person's dependants as their ordinary residence, will be an eligible residence.
(2) A person may also apply under subsection (1) if the person
(a) is a lessee of approved land on which the person intends to construct and complete an eligible residence,
(b) intends to sell the completed eligible residence, and assign the person's interest as lessee of the approved land, to a person entitled to apply for a loan by way of leasehold mortgage,
(c) has obtained the consent of the lessor of approved land to assign the person's interest as lessee of that land to a person entitled to apply for a leasehold mortgage loan, and
(d) is, despite failure to comply with each provision of subsection (1) or this subsection, a cooperative, not for profit, as determined under the regulations.
4 (1) The minister may not make a loan under section 3 (2) (a) to (c) unless the applicant makes a written agreement with the minister to do all of the following:
(a) to complete construction of the eligible residence in the time and manner satisfactory to the minister;
(b) not to sell the completed eligible residence and assign the applicant's interest as lessee of the approved land for more than the price specified in the agreement;
(c) not to permit a tenant of the applicant to occupy the eligible residence.
(2) On application, the minister may waive or vary an agreement under subsection (1).
(3) Not more than one loan by way of leasehold mortgage may be made at the same time for the same applicant under section 3 (1).
(4) If the minister makes a leasehold mortgage loan under section 3, the minister must require the applicant to enter into a leasehold mortgage under this Act and the regulations.
5 (1) On application to the minister under the regulations and on satisfying the minister that the application complies with this Act and the regulations, a person is entitled to a conversion mortgage loan if the person
(a) owns a family residence, or commercial or industrial building, located in an area of British Columbia approved by the minister, and
(b) is converting, or has an agreement to convert, the family residence, or commercial or industrial building, into 2 or more eligible residences.
(2) The minister may not make a loan under subsection (1) unless the applicant makes a written agreement with the minister to complete the conversion in the time and manner satisfactory to the minister.
(3) If the minister makes a conversion mortgage loan, the minister must require the applicant to enter into a conversion mortgage under this Act and the regulations.
6 (1) On receiving written notice from the minister, a mortgagor must pay interest at the specified interest rate.
(2) The specified interest rate in a conversion or leasehold mortgage must not exceed the rate of interest required, on the date of application under this Act, for insured loans under the National Housing Act (Canada).
(3) Subject to subsection (1), a mortgagor must pay interest on a conversion or leasehold mortgage loan at the eligible interest rate.
(4) Except for a loan under section 3 (2) (d), a mortgagor is not entitled to pay interest on a leasehold mortgage loan at an eligible interest rate unless the mortgagor or the mortgagor's spouse was born in British Columbia, or ordinarily resided in British Columbia for
(a) a continuous period of not less than 5 years, or
(b) a continuous period of not less than 2 years immediately preceding the date of application for the loan.
7 (1) The amortization period of a leasehold mortgage must not exceed the shortest of the following:
(a) a period of 35 years or, for a mortgage under section 3 (2) (d), a period of 50 years;
(b) the period that the minister believes is the life expectancy of the eligible residence on which the loan is made;
(c) the part of the term of the lease of the approved land on which the eligible residence is located determined under the regulations.
(2) The amortization period of a conversion mortgage must not exceed the shorter of
(a) a period of 30 years, or
(b) the period that the minister believes is the life expectancy of the eligible residence on which the loan is made.
(3) The term of the mortgage must be determined by regulation.
8 (1) The total amount advanced under a conversion or leasehold mortgage loan, and the dates and amounts of periodic advances, must be determined by the minister under the regulations and subject to subsection (2).
(2) Under a conversion mortgage loan the total amount advanced must not exceed the smaller of the following:
(a) the equity of the mortgagor based on the fair market value of the eligible residences as determined by the minister;
(b) the amount for the first eligible residence, and for each other eligible residence, determined by regulation.
9 (1) On 10 days' notice to the minister, a mortgagor may prepay a mortgage loan.
(2) The amount required for prepayment must be determined by the minister under the regulations.
10 Subject to sections 6 to 9 and the regulations, a mortgage must contain the covenants, terms and provisions approved by the minister having regard to the applicant's circumstances.
11 Money must not be advanced on a conversion or leasehold mortgage unless the mortgage is registered in the proper land title office, subject only to the charges approved by the minister.
12 (1) The registrar of a land title office in which a leasehold mortgage is registered must not accept an application to register an instrument, as defined in the Land Title Act, affecting the mortgagor's interest in the land unless the application includes the written consent of the minister or a discharge of the mortgage.
(2) This section does not apply to an application to register a transmission of the mortgagor's interest in the land.
13 The registrar of a land title office in which a conversion mortgage is registered must not accept an application for deposit of a plan of subdivision or a strata plan affecting the mortgaged land unless the application includes the written consent of the minister or a discharge of the mortgage.
14 Promptly after registration, the registrar of a land title office in which a conversion or leasehold mortgage is registered must send notice of the registration to the assessor or surveyor of taxes responsible for assessing the mortgaged land.
15 (1) If a conversion or leasehold mortgage is absolutely foreclosed in an action to enforce a prior mortgage and the mortgagor has not paid the principal, interest, taxes, costs and expenses, payable under the conversion or leasehold mortgage, the minister may, by certificate, state the amount of money payable and the name of each person liable to pay it.
(2) The minister may file the certificate in the Supreme Court.
(3) The certificate has, on filing, the same effect, and is subject to the same proceedings as a judgment of the court for the recovery of a debt in the amount stated in the certificate against the person named.
16 (1) The minister may establish a committee, to be known as the mortgage eligibility committee, consisting of 3 persons to be appointed by the minister.
(2) With the consent of the minister, the committee may exercise any power given to the minister under this Act or the regulations.
17 (1) Money required for the purposes of this Act may be paid out of the consolidated revenue fund.
(2) The cumulative total of amounts paid out under this section and section 17 of the Home Purchase Assistance Act must not exceed the cumulative total of the following amounts:
(a) the cash balance of the fund established under section 7 of the Provincial Home Acquisition Act, S.B.C. 1967, c. 39, as at March 31, 1982;
(b) amounts paid into the consolidated revenue fund after March 31, 1982 in respect of grants, loans and mortgages made under this Act, the Home Purchase Assistance Act and the Provincial Home Acquisition Act, S.B.C. 1967, c. 39.
18 (1) The Lieutenant Governor in Council may make regulations referred to in section 41 of the Interpretation Act.
(2) For a conversion mortgage the specified interest rate determined by regulation may differ for different land and security or for different classes of land and security.
Copyright (c) 2001: Queen’s Printer, Victoria, British Columbia, Canada