The department shall then enter into a contract with the veteran for the sale of the property to the veteran. The department shall fix the selling price of the property as the purchase price thereof, as the total cost of improvements constructed, or as the value of the property, as determined by the department when the property is acquired by the department in a manner other than by purchase, to which the department may add all expenses incurred and estimated to be incurred by the department in relation thereto, inclusive of interest, administration, appraisals, examination of title, insurance premiums, mortgage guaranty fees, origination fees, incidental expenses, and the sum deemed necessary to meet unforeseen contingencies. In the case of real property acquired for the purpose of constructing improvements thereon, the department shall forthwith after acquiring that real property enter into the contract with the veteran authorized by this section at a selling price that does not exceed the department’s appraised value of the land, if the loan is to include the value of the land, and the amount of the department’s appraised value of the improvements to be constructed thereon and any of the other additions herein authorized. After the execution of the contract between the veteran and the department and the making of the initial payment thereon the department shall be authorized to pay the cost of the improvements contracted to be constructed on the real property, making progress payments thereon in the amounts and at those times that the department approves. The department shall, upon written request of the veteran and his or her contractor, have authority to approve additions to or deletions from the improvements contracted to be constructed and any savings affected or added cost incurred shall be deducted from or added to the amount due the department by the veteran under the terms of his or her contract.

The department may establish provisions under regulations adopted by the department pursuant to Section 987.93 with respect to cooperative dwelling units in lieu of, or in addition to, those set forth in this section.

Where the department enters into a contract for the sale of property on trust to an Indian veteran, the contract shall include the following conditions:

(a) The dwelling house or other improvements contracted to be constructed on trust land shall be completed in compliance with the standards of the building code applicable on the trust land. If there is no building code in force on the trust land, the applicable standards shall be those of the building code of the county in which the trust land is located.

(b) On the completion of construction, the Indian veteran shall provide to the department an inspection certificate from a qualified building inspector certifying that the dwelling house or other improvements comply with the standards of the building code as required by subdivision (a).

(Amended by Stats. 2012, Ch. 396, Sec. 3. (AB 1224) Effective September 20, 2012.)