The Secretary is required by statute to take any action necessary to provide a mortgagor with funds to which the mortgagor is entitled under the mortgage and which the mortgagor does not receive because of the default of the mortgagee. The Secretary may hold a second mortgage to secure repayment by the mortgagor under Sec. 206.27(d) or may accept assignment of the first mortgage. [61 FR 49033, Sept. 17, 1996] Sec. 206.119 [Reserved]