P.R. Laws tit. 28, § 553a
Notwithstanding the provisions of §§ 553 and 585 of this title and any other provisions of law or regulation to the contrary, the usufructuaries and tenants of parcels established under Titles V and VI of this act may mortgage their usufruct or lease right in said parcels, jointly with the dwellings heretofore or hereafter constructed on said parcels, solely to secure to the Puerto Rico Housing Bank the payment of any loan said bank may make to them for the acquisition, construction, repair or improvement of such dwellings, including refinancing. The registration of the building may be made through its description in a notarial certificate or in the mortgage deed. The value of said work shall be exempt from the payment of every kind of fee, both under the notarial schedule as well as under the registry of property schedule.
In the event of default in the payment of the loan, the said bank may foreclose the mortgage in its favor following the regular or summary proceeding, as it may deem convenient, but at the public auction held in such proceedings only the Puerto Rico Housing Bank and such persons as shall meet the qualifications required by law and regulations of usufructuaries of parcels under Titles V and VI of the Land Law of Puerto Rico shall be bidders. In the edicts that may be published announcing the auction the said warning shall be given, with information as to where the interested persons may obtain copies of the regulations for the administration of parcels under Titles V and VI and on said legal qualifications. The [bailiff] shall not execute a judicial sale deed in favor of any grantee other than the Housing Bank, until the Executive Director of the Housing Development and Improvements Administration shall certify that the grantee has been investigated and meets the proper qualifications prescribed by law and regulation. Any adjudication of property and usufruct right so auctioned, to any person who does not meet said requirements, shall be void and without any value or effect.
If no bidders attend the auction, and the property and usufruct right so auctioned is awarded to the Puerto Rico Housing Bank, the latter may sell same only to persons who meet the legal qualifications required by law and regulations of usufructuaries of parcels under Titles V and VI of the Land Law of Puerto Rico. To this end it shall be the duty of the Housing Development and Improvements Administration to submit to said bank in each case one or more of such candidates who are willing to purchase from said bank the said property and usufruct right at the price and on the terms and conditions in which said bank may best facilitate the sale and financing thereof.
There shall be exempt from the provisions and subdivision regulations of Act No. 213 of May 12, 1942, as amended, the subdivisions that may be necessary to mortgage the usufruct right or lease, in the parcels established under Title V of the Land Law, jointly with the dwellings built thereon, to guarantee the Puerto Rico Housing Bank the payment of any loan that said bank may grant for the acquisition, construction, repair or improvements to such dwellings.
In those cases in which there has been granted title deeds to usufructuaries of parcels under Title V of this act and that the property is encumbered by a mortgage in favor of the Housing Bank, said bank may execute the said mortgage following the ordinary or summary proceeding in accordance with the Mortgage Law in force and its Regulations as it may deem convenient and without being subject to that established in the preceding paragraphs.
All actions performed by the Puerto Rico Housing Bank in accordance with the provisions of this act prior to its date of approval are hereby validated.
History —Apr. 12, 1941, No. 26, added as § 76A on June 26, 1964, No. 97, p. 311; Apr. 19, 1968, No. 21, p. 36; June 27, 1969, No. 95, p. 256; June 23, 1971, No. 69, p. 206.