(1) DEFINITIONS. In this section: (a) “Debt service” means the amount due of principal, interest and premium for mortgage revenue bonds or revenue bonds issued under this section. (b) “Dwelling” means any structure used or intended to be used for habitation with up to 2 separate units certified for occupancy by the city. “Dwelling” also means any housing cooperative incorporated under ch. 185 or 193. (c) “Lending institution” means any private business issuing home mortgages. (d) “Municipality” means any city with a population greater than 75,000. (e) “Owner-occupied dwelling” means a dwelling in which the owner occupies or will occupy any unit. (2) ISSUING LOANS. (a) The legislative body of any municipality may adopt a resolution, authorizing the municipality to: 1. Issue mortgage loans with an interest rate less than the lowest rate available at lending institutions within the municipality, for the purchase or construction of any owner-occupied dwelling located within an area described in sub. (3). Financing for rehabilitation or home improvements may be made available as part of these loans. 2. Issue loans to any lending institution within the municipality that agrees to loan the money at designated terms for the purchase, purchase and rehabilitation or construction of any owner-occupied dwelling located within an area described in sub. (3). 3. Foreclose any mortgage and sell the mortgaged property for collection purposes if the mortgagor defaults on the payment of principal and interest of a loan issued under this section. (b) The resolution shall designate each area in which dwellings are eligible for loans. (c) No loan may be issued to purchase, purchase and rehabilitate or construct a dwelling that violates applicable provisions of the one- and 2-family dwelling code under ss. 101.60 to 101.66, or that violates any ordinance the municipality adopts regulating the dwelling. If the dwelling is found to be violating the dwelling code or any ordinance after issuance of the loan, the loan shall default. The municipality may require the full loan to become due or may increase the interest rate to the maximum allowable. The municipality may defer imposing a penalty for up to one year after the violation is found to exist. (3) ELIGIBLE AREAS. Owner-occupied dwellings in any area of the municipality are eligible for loans under this section if any 2 of the following conditions exist: (a) The median assessed property value of one- and 2-family dwellings in the area is less than or equal to 80 percent of the median assessed property value of one- and 2-family dwellings in the municipality. (b) The median family income of the area is less than or equal to 80 percent of the median family income of the municipality. (c) The proportion of owner-occupied dwellings in the area is less than or equal to 80 percent of the proportion of owner-occupied dwellings in the municipality. (d) The vacancy rate of dwellings in the area is greater than or equal to 120 percent of the vacancy rate of dwellings in the municipality. (4) REVENUE BONDING. (a) The governing body of any municipality may issue revenue bonds by resolution, to finance lowinterest mortgage loans under this section. The resolution shall state the maximum dollar amount of authorized bonds and the purpose for which the municipality may issue the bonds. The resolution shall state the terms, form and content of the bonds. These bonds may be registered under s. 67.09. (b) Debt service is payable solely from revenues received from the loans issued under this section. No mortgage revenue bond or revenue bond issued under this section is a debt of the municipality or a charge against the city’s general credit or taxing powers. The municipality shall plainly state the provisions of this paragraph on the face of each mortgage revenue bond or revenue bond. (c) The municipality shall use revenues from payment of the principal and interest of loans issued under this section to pay debt service. The municipality shall use any excess revenues to pay other costs accruing from the issuance of the loans. The municipality shall deposit any remaining revenues in a revolving fund of the municipal treasury, to use for additional loans under this section. (d) The resolution may authorize appointment of a receiver to collect interest and principal on loans issued under this section for paying debt service, if the municipality defaults on paying debt service.
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