Commonwealth Numbered Acts

DEFENCE FORCE (HOME LOANS ASSISTANCE) ACT 1990 No. 14 of 1991 - SCHEDULE 2

SCHEDULE 2
CONSEQUENTIAL AMENDMENTS OF THE DEFENCE SERVICE HOMES ACT 1918 The Defence
Service Homes Act 1918 is amended as set out below. Subsection 4 (1):
Insert the following definition:

"`Home Loans Assistance Act' means the Defence Force (Home Loans  Assistance)
Act 1990 ;". After section 4A:
Insert the following section: Election to surrender eligible status

"4BA. (1) An eligible person who:

   (a)  is a member of the Defence Force:

   (i)  whose first service in the Defence Force began on or before 14 May
        1985; or

   (ii) whose first service in the Defence Force began after that day but who
        is covered by paragraph (ga) of the definition of "
        Australian Soldier" in subsection 4 (1); and

   (b)  is not, and has not at any time been, a borrower; and

   (c)  does not hold a certificate of entitlement that is in force in
        relation to subsidy on an initial advance; may elect to surrender his
        or her status as an eligible person under this Act.

"(2) An election must be:

   (a)  in writing, signed by the person making it; and

   (b)  given to the Secretary within the prescribed period.

"(3) An election is irrevocable and takes effect on the day on which it is
given to the Secretary.

"(4) When an election takes effect, the person making it stops being an
eligible person for the purposes of this Act.

"(5) The Secretary must cause a copy of each election to be given to the
Secretary to the Department of Defence.

"(6) In this section:
`prescribed period' means the period of 6 months starting on the day on which
this section commences.". Section 38:
Add at the end "and of houses, land, building materials and improvements of
the kind mentioned in section 38CA". Subsection 38A (2):
Omit "section 38C", substitute "this Part". Subsection 38C (3):
Omit the subsection. After section 38C:
Insert the following sections: Insurance of certain other houses etc.

"38CA. (1) The Commonwealth may undertake insurance of, or in relation to:

   (a)  a house in respect of which an entitled person has sought a subsidised
        loan; or

   (b)  building materials on the site of a house mentioned in paragraph (a),
        being materials used in the building of, or otherwise in relation to,
        the house; or

   (c)  any permanent improvement of a structural kind that has been made to a
        house mentioned in paragraph (a), or that has been constructed on the
        land on which such a house is built, and any building materials on the
        site of, and used in the building of, or in relation to, such an
        improvement.

"(2) The Commonwealth may undertake insurance against risks related to the
land on which a house mentioned in paragraph (1) (a) is built, or on which a
house mentioned in paragraph (1) (b) is being, or is to be, built.

"(3) In this section:
`house', `entitled person', and `subsidised loan' have the same respective
meanings as in the Home Loans Assistance Act. Powers of Commonwealth under
this Part

"38CB. The Commonwealth may do all things necessary or convenient to be done
for the purpose of undertaking insurance under this Part and, without limiting
the generality of its powers under this section, may enter into an agreement
of a kind known as a concessions agreement with a person who is, or is likely
to be, the mortgagee of property insured with the Commonwealth.". Paragraph
38E (1) (a):
After "undertaken insurance" insert "under section 38C". After section 38E:
Insert the following section: Termination of insurance undertaken under
section 38CA

"38EA. (1) This section applies where:

   (a)  the Commonwealth has undertaken insurance under section 38CA in
        relation to a house; and

   (b)  the entitled person dies before obtaining a subsidised loan in
        relation to the house or any of the following things happen;

   (i)  the Bank refuses to make a subsidised loan to the person in relation
        to the house;

   (ii) the entitlement certificate issued to the person is cancelled;

   (iii) subsidy does not become payable under section 20 of the Home Loans
        Assistance Act on a loan made in relation to the house;

   (iv) subsidy stops being payable on such a loan under paragraph 29 (d) or
        (e) of that Act.

"(2) Where this section applies:

   (a)  the insurance undertaken in relation to the house does not cease to
        have effect on the death of the entitled person or the happening of
        anything mentioned in subparagraph (1) (b) (i), (ii), (iii) or (iv);
        and

   (b)  unless the insurance has already ceased to have effect for some other
        reason, the Secretary must give reasonable notice in writing to each
        person having an interest in the house that the insurance will cease
        to have effect on a day specified in the notice.

"(3) Where the Secretary gives a notice under paragraph (2) (b), the insurance
ceases to have effect on the day specified in the notice unless it has already
ceased to have effect.

"(4) Where this section applies because of the death of an entitled person and
the person is survived by a widow or widower, the Secretary must not give a
notice under paragraph (2) (b) in relation to the house unless satisfied that
a subsidised loan will not be, or is unlikely to be, made to the widow or
widower in respect of that house.

"(5) In this section:
`house', `entitlement certificate', `entitled person', `subsidised loan' and
`the Bank' have the same respective meanings as in the Home Loans Assistance
Act.". Section 38F:
Omit "section 38C", substitute "this Part".