This rule amends the regulations for refinancing mortgages under section 235(r) of the National Housing Act. Since the enactment of this program in 1988, mortgagees have not expressed an interest in participating in this program. Therefore, HUD seeks to enhance the program by providing for the payment by HUD, rather than by the mortgagee, of the incentive to the mortgagors and of specific refinancing costs, and by limiting the origination of these loans to the number of approved mortgagees that would make the program most attractive. This rule also eliminates obsolete regulations within 24 CFR part 235.