---
kind: "section"
citation: "24 C.F.R. § 203.510"
title: "24"
number: "203.510"
heading: "Release of personal liability."
url: "https://uscodex.org/cfr/24/203.510"
---

# §203.510. Release of personal liability.

- (a) **Procedures.** The mortgagee shall release a selling mortgagor from any personal liability for payment of the mortgage debt, if release is permitted by [§ 203.258](/cfr/24/203.258.md) of this part, in accordance with the following procedures:
  - (1) The mortgagee receives a request for a creditworthiness determination for a prospective purchaser of all or part of the mortgaged property;
  - (2) The mortgagee or servicer performs a creditworthiness determination under [§ 203.512(b)(1)](/cfr/24/203.512.md?p=b-1) of this part if the mortgagee or servicer is approved for participation in the Direct Endorsement program, or the mortgagee requests a creditworthiness determination by the Secretary;
  - (3) The prospective purchaser is determined to be creditworthy under the standards applicable when a release of the selling mortgagor is intended;
  - (4) The prospective purchaser assumes personal liability by agreeing to pay the mortgage debt; and
  - (5) The mortgagee provides the selling mortgagor with a release of personal liability on a form approved by the Secretary.
- (b) **Release after 5 years.**
  - (1) If a selling mortgagor is not released under the procedures described in [paragraph (a)](#a) of this section, either because no request for a creditworthiness determination is submitted under [paragraph (a)(1)](#a-1) of this section, or because there is no affirmative determination of creditworthiness under [paragraph (a)(3)](#a-3) of this section, then the selling mortgagor is automatically released from any personal liability for payment of the mortgage debt because of section 203(r) of the National Housing Act if:
    - (i) The purchasing mortgagor has assumed personal liability by agreeing to pay the mortgage debt;
    - (ii) Five years have elapsed after the assumption; and
    - (iii) **The purchasing mortgagor is not in default under the mortgage at the end of the five-year period.**
  - (2) If the conditions of this [paragraph (b)](#b) for a release are satisfied, the mortgagee shall provide a written release upon request to the selling mortgagor.
  - (3) This [paragraph (b)](#b) only applies to a mortgage originated pursuant to an application by the mortgagor on or after December 1, 1986 on a form approved by the Secretary.
- (c) **Mortgagee to provide notice.** A mortgagee shall inform mortgagors (including prospective mortgagors seeking information) about the procedures for release of personal liability by providing a notice approved by the Secretary when required by the Secretary.

## Notes

### Amendments

[58 FR 42649, Aug. 11, 1993]

### Source

Source: 41 FR 49736, Nov. 10, 1976, unless otherwise noted.

### Authority

Authority: 12 U.S.C. 1707, 1709, 1710, 1715b, 1715z-16, 1715u, and 1715z-21; 15 U.S.C. 1639c; 42 U.S.C. 3535(d).

### Source

Source: 36 FR 24508, Dec. 22, 1971, unless otherwise noted.

### Amendments

[58 FR 42649, Aug. 11, 1993]