CFR > Title 24 - Housing and Urban Development > SUBTITLE B—Regulations Relating to Housing and Urban Development > CHAPTER II—OFFICE OF ASSISTANT SECRETARY FOR HOUSING—FEDERAL HOUSING COMMISSIONER, DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (parts 200 to 291) > SUBCHAPTER B—MORTGAGE AND LOAN INSURANCE PROGRAMS UNDER NATIONAL HOUSING ACT AND OTHER AUTHORITIES (parts 201 to 266) > PART 242—MORTGAGE INSURANCE FOR HOSPITALS > SUBPART C—Mortgage Requirements (§242.25 to §242.38) > 242.25—Mortgage form and disbursement of mortgage proceeds.

242.25—Mortgage form and disbursement of mortgage proceeds.

(a) Mortgage form. The mortgage shall be:
(1) Executed on a form approved by HUD for use in the jurisdiction in which the property covered by the mortgage is situated; the form shall not be changed without the prior written approval of HUD.
(2) Executed by an eligible mortgagor.
(b) Disbursement of mortgage proceeds. The mortgagee shall be obligated, as a part of the mortgage transaction, to disburse the principal amount of the mortgage to (or for the account of) the mortgagor or to his or her creditors for his or her account and with his or her consent.