---
kind: "section"
citation: "24 C.F.R. § 200.63"
title: "24"
number: "200.63"
heading: "Required deposits and letters of credit."
url: "https://uscodex.org/cfr/24/200.63"
---

# §200.63. Required deposits and letters of credit.

- (a) **Deposits.** Where the Commissioner requires the mortgagor to make a deposit of cash or securities, such deposit shall be with the mortgagee or a depository acceptable to the mortgagee. The deposit shall be held by the mortgagee in a special account or by the depository under an appropriate agreement approved by the Commissioner.
- (b) **Letter of credit.** Where the use of a letter of credit is acceptable to the Commissioner in lieu of a deposit of cash or securities, the letter of credit shall be issued to the mortgagee by a banking institution and shall be unconditional and irrevocable:
  - (1) The mortgagee of record may not be the issuer of any letter of credit without the prior written consent of the Commissioner.
  - (2) The mortgagee shall be responsible to the Commissioner for collection under the letter of credit. In the event a demand for payment thereunder is not immediately met, the mortgagee shall immediately provide a cash deposit equivalent to the undrawn balance of the letter of credit.

## Notes

### Source

Source: 61 FR 14399, Apr. 1, 1996, unless otherwise noted.

### Authority

Authority: 12 U.S.C. 1702-1715z-21; 42 U.S.C. 3535(d).

### Source

Source: 36 FR 24467, Dec. 22, 1971, unless otherwise noted.