AFFORDABLE HOMEOWNER REHABILITATION
LOANS AND GRANTS PROGRAM
POLICIES AND PROCEDURES
The City of Huntington Beach
April 5, 2010November 1, 2022
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TABLE OF CONTENTS
CHAPTER 1 - INTRODUCTION ......................................................................................................... 44 CHAPTER 2 - PROGRAM .................................................................................................................. 55 GENERAL ......................................................................................................................................... 55 HOUSING REHABILITATION PROGRAM ................................................................................................ 55 DEFERRED PAYMENT LOANS (DPL) ................................................................................................... 55 REHABILITATION GRANTS .................................................................................................................. 66 HOUSING QUALITY STANDARDS GRANTS (HQS Grants)… ………………………………6 CHAPTER 3 - PROGRAM REQUIREMENTS .................................................................................... 87 GENERAL ......................................................................................................................................... 87 ELIGIBILITY ....................................................................................................................................... 87 APPLICATION CONSIDERATION FACTORS ........................................................................................... 98 APPLICATION FEE ............................................................................................................................. 98 DETERMINING INTEREST RATES ........................................................................................................ 98 LOAN PAYMENTS .............................................................................................................................. 98 PREPAYMENT PENALTY ................................................................................................................... 109 MAKE PAYMENTS ON ALL DEBTS ..................................................................................................... 109 PRIMARY RESIDENCE ...................................................................................................................... 109 PROPERTY MAINTENANCE ............................................................................................................. 1110 FIRE AND HAZARD INSURANCE ...................................................................................................... 1110 FLOOD INSURANCE ....................................................................................................................... 1110 PROPERTY TAXES AND HOMEOWNER ASSOCIATION DUES ............................................................. 1110 USE OF FUNDS ............................................................................................................................. 1110 TIMING OF REHABILITATION PROJECTS .......................................................................................... 1211 NON-DISCRIMINATION.................................................................................................................... 1211 COMPLAINT PROCEDURES ............................................................................................................ 1211 CHAPTER 4 - PROCESSING ........................................................................................................ 1312 GENERAL ..................................................................................................................................... 1312 THE APPLICATION ......................................................................................................................... 1312 APPLICATION LOG ......................................................................................................................... 1413 QUALIFYING REHABILITATION LOANS ............................................................................................. 1413 LOAN UNDERWRITING/ QUALIFYING FORM ..................................................................................... 1413 LOW INCOME HOUSEHOLD QUALIFICATION .................................................................................... 1413 INCOME ........................................................................................................................................ 1413 DEBT TO INCOME RATIO ................................................................................................................ 1514 LOAN TO VALUE RATIO .................................................................................................................. 1514 INCOME HISTORY .......................................................................................................................... 1514 VERIFICATIONS ............................................................................................................................. 1615 TITLE INSURANCE ......................................................................................................................... 1615 PRELIMINARY PROPERTY INSPECTION ........................................................................................... 1615 LOAN APPROVAL ........................................................................................................................... 1716 SELECTION OF CONTRACTORS ...................................................................................................... 1716 CONFLICT OF INTEREST ................................................................................................................ 1717 BONUS, COMMISSION OR FEE ....................................................................................................... 1817 ACCEPTABLE CONTRACTS ............................................................................................................. 1817 CHANGE ORDERS ......................................................................................................................... 1817 CONSTRUCTION PROGRESS INSPECTIONS ..................................................................................... 1818
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FUNDING THE LOAN ...................................................................................................................... 1918 CONTRACTOR LIEN RELEASES ...................................................................................................... 1919 FINAL INSPECTION ........................................................................................................................ 2019 ACCEPTANCE OF WORK ................................................................................................................ 2019 POST FUNDING AUDIT ................................................................................................................... 2019 CHAPTER 5 - DOCUMENTATION ................................................................................................ 2120 GENERAL ..................................................................................................................................... 2120 DOCUMENTS REQUIRED ................................................................................................................ 2120 PROMISSORY NOTE ...................................................................................................................... 2120 DEED OF TRUST ........................................................................................................................... 2221 LIEN AGAINST MOBILEHOME TITLE ................................................................................................ 2221 DISCLOSURES AND NOTICES ......................................................................................................... 2322 HISTORIC PRESERVATION COMPLIANCE ........................................................................................ 2524 NOTICE OF OPPORTUNITY TO RESCIND TRANSACTION ................................................................... 2524 NOTICE TO CONTRACTOR AND HOMEOWNER OF CONTRACTOR PROVISIONS ................................... 2524 SAFEGUARDING DOCUMENTS ........................................................................................................ 2524 CHAPTER 6 - LOAN MAINTENANCE AND ACCOUNTING ......................................................... 2625 GENERAL ..................................................................................................................................... 2625 FILE ORGANIZATION ...................................................................................................................... 2625 ACCOUNTING FOR DEFERRED REPAYMENT LOANS ......................................................................... 2726 CHARGE-OFFS ............................................................................................................................. 2726 PARTIAL REPAYMENT UPON SALE OR REFINANCE .......................................................................... 2726 LOAN PAYOFFS ............................................................................................................................. 2726 RESPONDING TO A REQUEST FOR BENEFICIARY’S DEMAND ............................................................ 2827 RECONVEYING THE TRUST DEED ................................................................................................... 2827 DEFAULTS .................................................................................................................................... 2828 SUBORDINATION ........................................................................................................................... 2928 CLOSING THE LOAN FILE ............................................................................................................... 3130
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LIST OF APPENDICES
Appendix A – Additional Loan Requirements for Duplexes, Triplexes and Fourplexes and Multifamily Rental Property Loan Application
Appendix B – Emergency Rehabilitation Grant Application Appendix C – Single-Family Rehabilitation Loan Application Appendix D – Rehabilitation Loan Qualifying Sheet
Appendix E – Authorization for Release of Information Form Appendix F – Loan Approval Form
Appendix G – Gross Income Defined California Code of Regulation Title 25 Housing and Community Development, Section 6914
Appendix H – Right of Entry Agreement
Appendix I – Escrow Disbursement Agreement
Appendix J – Authorization of Loan Disbursement Form
Appendix K – Escrow Control Instructions
Appendix L – Single-Family Home Promissory Note
Appendix M – Mobilehome Promissory Note
Appendix N – Deed of Trust
Appendix O – Mobilehome Statement to Encumber
Appendix P – Mobilehome Statement of Lien
Appendix Q – Credit Report Authorization Form Authorization to Access Records Form
Appendix R– Fair Lending Notice
Appendix S – Truth in Lending Regulation Z
Appendix T – Sample Contract Between Homeowner and General Contractor Appendix
U – Notice to Proceed Form
Appendix V – Loan Subordination Policy and Application
Appendix W – Loan Subordination Request Form
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Homeowner Rehabilitation Loans and Grants Program Page 1 Definitions
The following defined terms apply throughout these loan programs guidelines unless otherwise specified herein:
1. “Approval and Revisions of Policies and Procedures” means a City Council action to amend the adopted rehabilitation loan and grant programs policies and procedures.
2. “CDBG” means federal Community Development Block Grant funds regulated by the United States Department of Housing and Urban Department.
3. “Certificate of Title” means a record of property ownership. The Certificate of Title will tell the prospective buyer the size and general shape of the sect ion (property), who owns it and whether there are mortgages, leases, rights of way or other interests registered against the title. It will also tell you whether the land is freehold or leasehold.
4. “Eligible Contractor” means a building contractor who has a current and valid license issued by the California Cont ractors State License Board, City of Huntington Beach business license, and valid insurance.
5. “City” means the City of Huntington Beach, California.
6. “City Council” means the City Council of the City of Huntington Beach.
7. “County” means the County of Orange, California.
8. “Deed s of Trust” means when taking out a loan to buy a house, the borrower is required to sign a Promissory Note (or “not e”) that legally obligates the borrower to pay back the money. At the same time, t he borrower gives the lender a mortgage, or a lien on the house that provides the lender with a security interest in the property.
This means that the borrowe r puts the house up as collateral for repayment of the loan. If the borrower fails to pay the loan, the mortgage allo ws the lender to foreclose on the property. In some states, the security interest in the house is called a “Deed Of of Trust,” which is essentially the same thing as a mortgage.
9. “Director
of Community DevelopmentEconomic Development ” (or designee) means the City official that is authorized to make discretionary approvals; and reviews and rules on any appeal of a decision made by the Program Administrator. This City official also rules on any dispute pertaini ng to the administrati on of the program as provided in the guidelines for Homeowner Rehabilitation Loans and Grants Program.
10. “DPL” means Deferred Payment Loans fo r which payment of the principal and accrued interest is deferred until the property is sold, transferred, or refinanced.
11. “ Economic Community Development Department” means the Economic Community Development Department of the City of Huntington Beach . which is also the Redevelopment Agency staff.
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12. “Grant Agreement” means the agreement between the Redevelopment AgencyCity of Huntington Beach and the Participant (either single-family or mobile home owner) describing the scope of wo rk, disbursement of Agency CDBG Grant proceeds, use of the property to verify owner occupancy and income eligibility, and conditions of defaults, remedies and termination.
13. “HCD” means the Californi a Department of Housing and Community Development.
14. “Homeowners” includes owners of si ngle-family detached homes, townhomes, condominiums, duplexes, triple xes, fourplexes and mobile homes. Homeowners are required to reside on at the property as their primary residence.
15. “Housing Manager” means the Housing and Real Estate Manager in the Economic Community Development Department of the City of Huntingt on Beach. The Housing Manager may approve an excepti on to the qualifying debt to income ratio for a loan applicant.
16. “HQS” means HUD designated Housing Quality Standards.
17. “HUD” means the United States Depar tment of Housing and Urban Development.
18. “Lead Based Paint Standards” m eans the 1992 Housing and Community Development Act as amended in 1999 , which includes regul ations requiring that federally funded housing rehabilitation pr ograms assess lead-based paint risks and abate hazards in specific circumstances. Fo r more complete details regarding lead- based paint regulations and requirements, refe r to Title X of the HCD Act (a copy of this regulation is maintained in the Economic Community Development Department).
19. “Loan Agreement” means t hat portion of the City of Huntington Beach Deferred Payment Loan Promissory Note that cont ains the terms of the loan agreement between a homeowner and the City.
20. “Loan Eligibility Requirement s” means the requirements that must be met in order to qualify for a DPL.
21. “Low -Income Households” refers to households whose incomes meet the standards defined by 24CFR570.3 for the use of CDBG funds. For the purposes of the Affordable Homeowner Rehabilitation Loans and Grants Program, the term low- income households means low- and moderate-income households that have an income less than the Section 8 low-income limit established by HUD. The qualified household income levels are published by HUD annually.
22. “Notice of Right to Rescind Transaction” means in the case of any consumer credit transaction in which a security interest, is or will be retained or acquired in any property which that is used as the principal dwelling of the person to whom credit is extended, the obligor (borrower) shall have the right to rescind the transaction until midnight of the third business day following the consummation of the transaction or Processing Procedures
Homeowner Rehabilitation Loans and Grants Program Page 3 the delivery of the information and rescission forms required under this section together with a statement c ontaining the material disclosures required under this subchapter, whichever is later, by notifying the creditor.
23. “Program Administrator” is a staff member or firm contracted by the City to administer the Homeowner Rehabilitation Loans and Grants Program.
24. “Promissory Note” is one of the requir ed loan documents that defines the essential terms of the loan and describes the repayment obligation of the borrower.
25. “Rehabilitation Loan Database” means the City’s database of each loan including amount, borrower name, address, date and comments.
26. “Single-Family Home” means single-family homes, townhomes, condominiums, duplexes, triplexes and fourplexes.
27. “Truth in Lending Statements” (also re ferred to as Regulation Z) means Mortgage lenders are required to provide the borrowe r a truth in lending (TIL) statement containing information on the annual percentage rate, the finance charge, the amount financed, and the total payments required. Within three days of the time application for the mortgage, the lender is required to provide the borrower with a "good faith estimate of settlement costs," or TIL, based on his or her under standing of purchase contract. This estimate should provide t he buyer a good idea of how much cash will be needed at closing to cover pro-rated ta xes, first month's interest, and other settlement costs.
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CHAPTER 1 - INTRODUCTION
The City of Huntington Beach through its Affordable Homeowner Rehabilitation Loans and Grants Program (Program) provides deferred payment rehabilitation loans and grants to homeowners that are lo w-income households. Qualifying pr operties include single-family homes, townhomes, mobile homes, duplexes, tr iplexes, and fourplexes. The City uses Community Development Block Grant funds m ade available by the U. S. Department of Housing and Urban Development to provi de these loans and grants. The City Council authorizes funding, and the Economic Community Development Department either contracts with a consulting firm (Program Administrator) to administer the Program or administers the Program in-house. The primar y objective of the Program is to provide financing to households who would otherwise have difficulty paying for the repairs necessary to bring their home to a decent, safe and sanitary quality level. Loans are underwritten and approved by the Program Administrator. The underwrit ing process is intended to give the City assurance that the borrower is creditworthy, has the ability to repay the debt, and has sufficient collateral to minimize the chance for loan default. Property owners may contact the Economic Community Development Department to obtai n the most current Program information.
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CHAPTER 2 - PROGRAM
General
The Affordable Homeowner Rehabilit ationHomeowner Rehabilitation Loans and Grants Program is authorized by the City Council and administered by the Program Administrator based upon the Processing Procedures for Affordable Homeowner RehabilitationHomeowner Rehabilitation Loans and Grants Program (Processing Procedures) adopted by the City Council. The Processing Procedures are authorized by the City Council. City staff may make technical changes to the Processing Procedures or any form, application, agreement or ot her document used to implement the Affordable Homeowner Loans and Grants Program . Substantive additions or policy revisions outside of clarification or technical corrections require the approval of the City Council. This policy document, effective November 1, 2022 supersedes any existing housin g rehabilitation loan and grant policies utilized by Cit y staff and shall apply to all loans or grants approved or made by the City on or after November 1, 2022.
At the recommendation of t he Program Administrator , and at the sole discretion of the Director of Economic Community Development, an applicant’s written request for a waiver of certain Loan Eligibility Requirements may be considered. Wa ivers are rare, but may include such things as allowing an alternative type of documentation as proof of income or the use of other alternative means to accommodate specia l circumstances. All waiver requests shall include a detailed explanation of the circum stances surrounding the request, and why the request is reasonable and necessary for the safe ty or well-being of the borrower/grantee.
The City will at no time consider or grant a waiver that is in consistent with established HUD CDBG Guidelines.
Housing Rehabilitation Program
The City offers both grants and loans for ow nership housing rehabilit ation. The ongoing funding is authorized by the City Council upon the recommendation of the Director of Economic Community Development. The loans are offered at below market interest rates to qualified homeowners that are low - income households. The grants provide money for smaller projects that can r ange from correcting deferred ma intenance to correcting health and safety defects or for lead based paint abatement. Details for these programs are provided below.
Deferred Payment Loans (DPL)
The rehabilitation loans are funded from HUD CDBG. The amount of available funding varies annually. Homeowners that are low-income households are eligible to apply for loans of up to $75,000 under the DPL. Individual loans are evaluated, underwritten, and approved by the Program Administrator. The funding limit is set at $75,000 for single - family homes, condominiums and multi-family residencies. Mobile homes will be capped at $15,00025,000.
Funding limits for individual loans may be increased by up to $10,000 ($5,000 for mobile homes) if deemed necessary to meet the H UD HQS requirements. Any increase above the Processing Procedures
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Prior recommendation for approval by the Program Administr ator will be required before a request to exceed the funding limits will be submitted to the Director of Economic Community Development for approval. The c urrent household income limits are available in the Economic DevelopmentCommunity Development Department. The interest rate for these loans is 3% simple interest subject to change at the direction of the Director of Economic Community Development.
Payment of the princi pal and accrued interest is deferr ed until the property is sold, transferred, or refinanced. Ho wever, if the DPL is repaid within two years, a prepayment penalty will be applied. This r equirement is imposed to ensure that the loan funds ar e not used on a speculative basis to enhance the home’s value for resale purposes.
Rehabilitation Grants
The City offers a one-time grant not to ex ceed $10,00015,000 to homeowners that are low- income households for deferred mainten ance and health and safety-related household repairs. Deferred maintenance can include paint, siding replacement, window and door replacement and roof repair or removal of any condition of b light. Household repairs may include restoration or replacem ent of inoperable or severely deteriorated plumbing, heating, and electrical systems, structural and appliance replacement. A homeowner is not eligible to receive a grant if a DPL has been funded within the pas t five y ears unless extr eme emergency can be established. However, if additional funds are needed for emergency repairs the amount of the additional funds will be added to the loan balance. If an owner who receives a grant applies to and is approved for a DP L within five years of receipt of the grant funds, the grant amount will be added to and become a part of the loan. All grants extended in addition to DPL loans must be approved by the Director of Economic Community Development prior to funding. A grant will not be extended if the estim ated cost of repairs required to meet the health and safety code exceeds $10,000$15,000 . In this case, the borrower may apply for a DPL.
The Program Administrator mu st approve the propos ed grant and scope of work. With this approval, the grant recipient ma y proceed with the authorized r ehabilitation. After work is completed and inspected, the hom eowner must submit to the City either an original receipt or invoice. A licensed contractor must perform all work.
Mobile Home Housing Quality Standards Grants
Homeowners that qualify to receive Mobile Home Tenant Based Rental Assistance (MHTBRA) to pay space rent for their mobile home must demonstrate that the mobile hom e meets HUD Housing Quality Standards (HQS). Homeowners found eligible to receive MHTBRA are also eligible to receive an HQS Grant of up to $1,200 in CDBG funds to make corrections needed to meet HUD HQS requirements. Such items may include installation of smoke and carbon monoxide detectors, GFCI protectors, and water heater earthquake straps if needed.
HQS Grant candidates will be co nsidered in conjunction with appr oval to receive MHTBRA.
When homeowner eligibility is confirmed as e ligible to receive MHTBRA, an HQS Inspection Processing Procedures
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If the estimated cost of r epair exceeds $1,200, the homeowner may apply for a Rehabilitation Grant up to $15,000 or loan up to $25,000 depending upon available funding.
A homeowner that has qualified to receive M HTBRA must make corrections to their mobile home in order to meet HQS standards, and will be provided 120 day s to complete the necessary repairs through the HQS Grant or Emergency Grant Programs.
MHTBRA funds to assist the eligible homeowner with space rent will be frozen during this 120-day period to achieve compliance. Any ex tension of time beyond 120 days will be considered on a case-by-case basis and must be approved by the Housing Manager .
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General
There are a number of regulatory requirements associat ed with federally funded municipal housing rehabilitation loan programs. The City has also el ected to impose cer tain additional
restrictions in order to assure that the Affordable Homeowner R ehabilitationHomeowner Rehabilitation Loans and Grants Program wil l be utilized in a manner that best serves the community. It is not intended for the City to make loans that are unreasonably risky thus jeopardizing its investment. The requirem ents discussed below are designed to address these matters. The loan requirements pertain to owners of single-family homes, townhomes, and mobile homes. Additional requirements fo r duplexes, triplexes, and fourplexes are provided in Appendix A.
Eligibility
The City will only consider loan and grant applications for homes that satisfy the following minimum requirements:
The home must be located within the City of Huntington Beach. The home must be owner occupied.
If the property is located within a flood zone, adequate flood insurance is required. The property must be zoned for appropriate residential use. The City’s Municipal Code must allow the proposed improvements. The rehabilitation must bring the property (i ncluding all units within the property) into compliance with existing City building and zoning codes and HUD HQS. No property can have loans that cumulative ly exceed 80% of the property’s value – this includes the rehabilitation loan.
The debt to income ratio cannot exceed 50% the homeowner’s income. The homeowner must qualify as a low-income household.
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Application Consideration Factors
Loan and grant applicants will be considered on a first-come-first-served basis and approved as funding permits. The following factors will be analyzed when approving projects:
Availability of funds.
Remaining economic li fe of the proposed improvements on the property.
Location of the project – although the programs are offer ed citywide, preference will be granted to those homes located within the Redevelopment Agency’s Project Areas or CBDG Enhancement Areas. Established CDBG Enhancement Areas shall have first priority in the case of limited funds.
Extent of rehabilitat ion required to meet HUD HQS and to meet building requirements, such as architectural compatibility with the neighborhood.
The degree of impact the rehabilitati on of the home will have on the neighborhood.
Equity position of the borrower.
Credit worthiness of the borrower.
For duplexes, triplexes, and fourplexes, t he homeowner agrees to restrict at a minimum 51% of the rental units to low- income tenants at the defined affordable rental rates until the rehabilitation loan is repaid in full.
Application Fee
Borrowers must pay a loan-processing fee of $500 for title search, ti tle update, appraisal, credit report, and recording as needed. The f ee may be paid from loan proceeds. The fee may be adjusted to reflect current market conditions at the discretion of the Director of Community DevelopmentDirector of Community Development.
Determining Interest Rates
The DPL interest rate is 3% simple interest . The Director of Economic Community Development may determine that the interest rate no longer best reflects current market conditions, at his/her discretion, another interest rate may be adopted.
Loan Payments
The rehabilitation loans must be repaid under the following terms:
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Loans must follow the individual program guidelines as described below in this chapter.
Prepayment Penalty
If a rehabilitation loan is paid within two years of the date of the loan agreement, there will be a prepayment penalty equal to the maximum amount the law allows at the time of default.
This penalty may be waived at the discretion of the Director of Economic Community Development. If a prepayment penalty is wa ived for cause, the circumstances and justification must be clearly documented in t he loan file. A loan may be paid in full with no penalties assessed at any time after two years. The purpose of this condition is to preclude borrowers from using these funds solely fo r the purpose of upgrading a home and then putting the home up for sale. The program’s basic purpose is to help people repair the home in which they intend to live.
Make Payments on all Debts
Borrowers must agree to remain current on their payments for all debts recorded against the property. Should a borrower default on any debt recorded against the property, thus triggering foreclosure proceedings, the City would be at risk of losing its investment. Failure to remain in good standing with all creditors who have a claim against the property is a cause of default and would make the rehabilitation loan immediately due and payable.
Primary Residence
Under the Homeowner Rehabilitation Loans and Grants Program, the borrower is required to own and reside in the property being financed, and have a likelihood of continuing to reside in the property for a minimum of two years. For duplexes, triplexes and fourplexes, the homeowner must reside in one of the units, and rent at least 51% of the other units to qualified low-income households. Any violation of these requirements represents an event of default.
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aintenance
The borrower is required to maintain the pr operty in good condition during the term of the rehabilitation loan (15 years) and in compliance with applicable Cit y and state laws and codes. The applicant must further agree to comply with HQS for the duration of the loan.
Fire and Hazard Insurance
The home taken as collateral for the rehabilitation loan must have adequate insurance coverage to protect the City from loss due to fire or other hazards. The property must be insured for an amount equal to the greater of: (1 ) the outstanding loans on the property, or (2) the replacement cost of the improvements. Borrowers are required to provide evidence of insurance during the term of the loan on an annual basis. The City mu st be designated on such insurance as an additional loss payee. Non-payment of insurance is an event of default and will make the loan due and payable.
The borrower must certify the details of the coverage before a loan is disbursed by providing the City with the original policy or binder. Policies must show an inception date prior to, or corresponding with, the date of rehabilitation loan funding.
Flood Insurance
During the credit evaluation process, the City will determine if the property is located in a special flood hazard area by revie wing flood maps located at the Building Department. If the property is found to be located within a designated special flood zone area, the borrower will be required to obtain flood insurance. Evidence of such insurance must be received prior to rehabilitation loan funding.
Property Taxes and Homeowner Association Dues
Borrowers are required to pay all property taxes and Home Owner Association dues during the term of the loan. Non-payment is an event of default and will make the rehabilitation loan due and payable.
Use of Funds
Rehabilitation loan funds are fo r the sole purpose of financing construction or reimbursing construction expenditures as identified in t he approved scope of work. In the event the City determines that a borrower misused loan f unds, the loan will become immediately due and payable.
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Timing of Rehabilitation Projects
After the loan has been approved and loan doc uments have been signed, the borrower will have 30 days to commence construction work. A ll work must be completed within a period not to exceed 180 days.
The Borrower (homeowner and/ or homeowner’s contractor) will diligently purse the rehabilitation construction withi n the schedule identified above. The Program Administrator may extend, in writing, the deadline for comp leting improvements for a period reasonably necessary to overcome a delay if the delay is due to a cause that is beyond the Borrower’s reasonable control. A cause is beyond the Borrower’s reasonable control if the Borrower with reasonable diligence, could not have foreseen and avoided the cause. Such causes include, but are not limited to, Acts of God; unusually se vere weather or flood; concealed conditions; and unavoidable inability to secure materials, supplies tools or transportation.
Non-discrimination
Applicants will not be discr iminated against on the basis of race , color, religion, sex, sexual orientation, creed, ancestry, nati onal or ethnic origin, age, family or marital status, handicap or disability. In addition, applicants may not discriminate in the lease, rental, use, occupancy, and awarding of contracts with respect to the pr operty to be rehabilitated with the assistance of a rehabilitation program loan or grant.
Complaint Procedures
Complaints concerning the Affordable Homeowner Rehabilit ationHomeowner Rehabilitation Loans and Grants Program must be submitted in writing to the Program Administrator.
Complaints will be accepted only if they are in writing and are received within 30 days from the event giving rise to the complaint. The Program Administrator will contact the complainant and attempt to resolve the probl em. A written response will be made to the complainant within 10 business days.
If a complainant is not satisfied with the wr itten response, a request for an appeal may be filed with the Housing Manager. T he written request must identify the reasons for the appeal and must be received by the Housing Manager within 15 days from the date of the Program Administrator’s written response. In the event the request does not meet these requirements, the complainant will be notified that the appeal request is denied; otherwise, the complainant will be invited to meet with the Housing Manager and Program Administrator to express his/her complaint. The response of the Hous ing Manager will be made in writing within 10 business days. If the complainan t is not satisfied with review and decision of the Housing Manager the complainant may appeal the decision to the Director of Economic Community Development. The Director will review the comp laint and then make a final ruling on the issue. The decision of the Director of Economic Community Development will be final.
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CHAPTER 4 - PROCESSING
General
The process of handling a loan from the acceptance of an app lication through funding is called loan processing. Upon approval of the loan the City and applicant will enter into a loan agreement followed by the fundi ng of the loan. Included in A ppendix B are sample Loan Agreements (Single-Family Deferred Loan, Single-Family R ehabilitation Grant, and Mobilehome Rehabilitation Grant, HQS Grant). The following is a step- by-step outline of the loan processing procedures for the rehabilitation loan and grant programs.
The Application
Applicants for the City’s Affordable Homeowner RehabilitationHomeowner Rehabilitation and Loans and Grants Program must provide the information ident ified on Rehabilitation Grant Application or HQS Grant Application (Appendix B) and the information on the Loan Application (Appendix C). The applications will be reviewed by t he Program Administrator. A loan applicant’s qualifying criteria will be summa rized on the Rehabilitation Loan Qualifying Sheet (Appendix D). The information provided on these forms is summarized below:
Property information and purpose of loan
A description of the proposed repairs
Applicant information and proof of residency
Employment information
Income and expense information
Assets and liabilities information
Declarations (credit history, citizenship, ethnicity) 1
Schedule of real estate owned (for owner s of duplexes, triplexes and fourplexes)
Schedule of rents for owner s of duplexes, triplexes and fourplexes that are for additional loan requirements (for owners of duplexes, triplexes and fourplexes)
All applicants are required to sign an Authorization for Re lease of Information Form (Appendix E) that allows the release to the Agen cy of any materials, which are deemed necessary to complete and verify the applicati on. All submitted applications are reviewed for completeness and program eligibility. When an applicant is determined to be eligible based
1 Information on citizenship and ethnicity is only included on the Loan Application.
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on the information in the applicati on, a preliminary property ins pection, credit report, title, appraisal and lead-based paint inspection are ordered and scheduled, as needed.
Application Log
As the City receives each applicat ion, it is recorded in an application log. This procedure assists City staff in tracking i ndividual applications, and allows for management oversight of the loan origination process.
Qualifying Rehabilitation Loans
Upon receipt of a completed application package, the Program Administrator will verify the applicant’s eligibility. The applicant’s financial information is reviewed for compliance with the rehabilitation loan and grant param eters. Issues such as debt to income ratio, loan-to-value ratio, and credit history are eval uated at that time. The Loan Appr oval Form is provided as Appendix F.
Loan Underwriting/ Qualifying Form
Upon receipt of completed application package, the Program Administra tor will perform the underwriting using the Qualifying Sheet. This form is designed to guide the Program Administrator through the general approval criteria of the loan program.
Low Income Household Qualification
Classification within Low-I ncome category is based upon household size and the gross income of all adult individuals who resi de within the household. HUD publishes updated income guidelines annually for Orange County. These guidelines are used to establish the maximum household income for each household size.
As part of the underwriting review, staff members will verify that the homeowner and tenants (if applicable) qualify as low-inco me households as defined by CDBG. The Program Administrator will also review the project scope of work at this point in the process.
Income
For the purposes of the rehabili tation loan and grant programs t he Gross Income calculation is based on the California Code of Regulations Title 25 Section 6914 definition (Appendix G).
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Debt-to-Income Ratio
The applicant’s monthly expenses such as hous ing costs, auto loans , revolving charge accounts, alimony, and child support must be i dentified in the applicat ion. The applicant’s debt-to-income ratio is then calculated by di viding the monthly expenses by the monthly gross income.
The debt-to-income ratio is one of the basic criteria used to determine if an applicant has the ability to repay a home mortgage. For the rehabilitation loan and grant programs the applicant total debt to income ratio may not be higher than 50%, unless the Program Administrator recommends an exception subject to approval by the Housing Manager.
Loan-to-Value Ratio
The total of all liens on the subject property, including the Cit y loan, may not exceed 80% of the after-rehabilitation appraised val ue of the home. The Director of Economic Community Development may set lower loan-to-value limits, depending on current market conditions. All existing and proposed encumbranc es on the property are deter mined, and a comparison of the encumbrances to the value of the property is made. The va lue of the proper ty is then established. The loan-to-value ratio is calcul ated by dividing the encumbrances by the sum of the appraised value at the time the loan is qualified and the City’s loan amount.
When there is more than one existing loan on a property, and the City will be required to accept a third position, the th ird position loans will receive more stringent review and risk analysis than those in a first or second positi on. The City will not acc ept any lien position lower than third.
Income History
To verify that the borrower has the ability to pay their existing monthly expenses, salaried applicants must provide written ve rification of two years inco me. Two years of records is required to verify a pattern of income. Only t he most recent year is used for determining whether the household qualifies under the established income limitations. At the discretion of the Program Administrator the verification may be in the form of one or more of the following:
completed and signed federal tax returns, W-2 forms, pay stubs , and/or direct employment verification forms; and bank statements in case of direct deposited funds, such as pensions or Social Security income. In the case of au thorized waivers, as discussed in the “Approval and Revision of Policies and Pr ocedures”, the Director of Economic Community Development may require or accept an alternate form of income verification.
Self-employed applicants or those with sole-p roprietor businesses must also provide a minimum of two years income history. Minimum acceptable verification must be in the form of completed and signed federal tax returns.
Processing Procedures
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Verifications
All income and asset sources must be verified independently of the information provided on the borrower’s application. It is the resp onsibility of the City to obtain and evaluate verifications for accuracy.
One method of evaluating accuracy of an applic ant’s financial information is to compare items listed on the credit report with the items listed on t he application. The applicant must account for any item not listed in one place or the other.
Any derogatory credit information must be fully explained in writi ng by the borrower.
Significant derogatory credit information may be reason for denial of the loan.
Title Insurance
The City’s ability to lend money where real estate is being used as collateral is dependent in most cases upon the applicant having clear titl e to the property and being able to give the City a secured interest in the property. In order to assure that the borrower has accurately represented title to real estate, all such l oans must be supported by a Preliminary Title Report obtained by the City.
A Title Officer prepares a title report after a search of public records, maps, and other relevant documents. This repor t ascertains title ownership and the existence of easements, restrictions, rights of way, conditions, encumbrances, or other matters affecting the title to, or use of, real property. A visual inspection of the property may also be made.
A Preliminary Title Report is a signed and dated formal report that sets out in detail the current conditions to a parcel of land. The follo wing matters must be checked carefully when reviewing a title report:
The estate or interest covered
The recorded owner
The parcel of land
Exceptions, liens, and encumbrances
Conveyances
Preliminary Property Inspection
The applicant shall agree that the City can require inspecti ons of the property to be conducted at any time during th e rehabilitation process to a ssure compliance with City and state Building Codes, HUD HQS and HUD Lead Bas ed Paint Standards. The applicant must also permit all other inspections deemed nece ssary regarding the property such as the
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rehabilitation work, materials, equipment, payrolls, and conditions of employment pertaining to the work.
After an applicant has been determined initially eligible for rehabilitation assistance, a preliminary property inspection will be scheduled. Prior to entry by City staff or authorized representative, the owner shall ag ree to the right of entry to in spect work on the property in consideration of eligibility for approval of a loan and approval of completed work by signing the Right of Entry Agreement between the City and the owner (Appendix H). This inspection will allow the Program Administrator to verify the extent of repairs needed to correct City code violations or to ascertain the existence of other property defici encies. The Scope of Work Report will need to be approved by the Pr ogram Administrator at the time of loan approval. Only items identified in this scope of work may be funded by the City’s loan, unless change orders are necessary to address unknown items.
Loan Approval
Upon the receipt and analysis of all required application information by the City, the Program Administrator will evaluate the application and other pertinent documentation. Based on this information, the Program Administrator will recommend approval or denial of the application.
The Loan Approval Form is used to determine whether the applicant has sufficiently satisfied each approval criteria for a l oan. The Program Administrator and the City will sign the Loan Approval Form to document approval of the loan.
Selection of Contractors
Contracting must be done on a competitive bi d basis. Prior to loan approval, the Program Administrator will work with the property owner to prioritize the necessary scope of work, and the borrower will request bids from home improv ement contractors. The homeowner must show due diligence or evidence of the solicitati on of at least three bids, and the contract must be awarded to the lowest-cost, qualifi ed bidder who meets the City’s licensing and insurance requirements. The applic ant may not award any contract for rehabilitation work to any contractor who, at the time of bid acceptance, does not have a current and valid State of California Contractor’s License, City of Huntington Beach business license, and insurance. A contract may not be awarded to a contractor who has been disqua lified by the City, HCD, or HUD. The City reserves the right to disqualify any contractor it deems unqualified to carry out the work to be performed. A homeowner is eligible to perform his/her work provided they have the proper license to perform said work. In this case, the loan or grant will only pay for materials (not labor).
When a contractor has been selected and loan approval has been obtained and lien or Deed of Trust has been secured against the owner’s property, the Program Administrator will authorize work to begin. In the event a borro wer begins construction work before Program Administrator approval is given, such work will not be an eligible activity under the rehabilitation loan or grant.
Conflict of Interest
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No member of the governing body of the City or an employee who exercises any functions or responsibilities in the administration of this program can have any interest, direct or indirect, in the proceeds of the loan, gr ant or in any contract entered into by the applicant for the performance of work financed. No City employ ee can have any financial interest in any contract, subcontract, or agreement either for themselves or those with whom they have business or immediate family ties. City empl oyees who qualify as low income households will be permitted to participat e in the Homeowner Rehabilitat ion Loans and Grants Program.
However, in no instance shall an employee of the Economic DevelopmentCommunity Development Department be permitted to apply and part icipate in the pr ograms. With the exception of a confirmed, dire emergency, all applications received from City employees are to be considered and processed in the same manner and order as a ll other applications, using the same established qua lifying criteria as approved herein. At no time shall an application received from a City employee be given preferential treat ment nor shall an employee applicant be offered preferential terms in connection with a loan or grant.
Bonus, Commission or Fee
The applicant may not pay a bonus, commission, or fee to any individual or business for the purpose of obtaining approval of the loan application or for any other approval to complete the rehabilitation work.
Acceptable Contracts
Three forms of contracting will be allowed under this program as follows:
Contracts between the homeow ner and a general contractor (a sample contract is provided in Appendix I);
Contracts between the homeow ner and a subcontractor; and
Contracts between the homeowner (acti ng as a contractor) and vendors.
All general contractors, hom eowners acting as contractors and subcontractors must be licensed and in good standing with the State of California and the City of Huntington Beach.
Homeowners acting as their own contractor cannot be compensated for labor.
Change Orders
All change orders to the cont ract require the signature of both the contractor and the borrower. The Program Administrator must al so approve change orders in order for them to be included in the rehabilitation loan.
Construction Progress Inspections
From time to time during construction, a contractor may request payment for work completed. Before payment will be approved, the Program Administrator will inspect the property to determine that the work has been completed or that an appropriate increment of
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the work has been completed. A material and lien release must be supplied for the portion of the work completed in an amount equal to the payment being made.
Funding the Loan
Upon loan approval by the Program Administrato r and selection of qualified contractors by the borrower, the Program Administrator will cr eate material requisitions for each contractor (material requisitions are used to open purchase orders). If pay ments are made through the City, separate material requisitions are required for each individual contractor. Checks will be made payable to the contractor or to an escrow company in t he amount of t he funds to be disbursed per the loan agreement. All funding documents will be made part of the permanent file.
When a purchase order is opened, a copy must be placed in the file, and one copy must be given to the Economic DevelopmentCo mmunity Development Department’s finance coordinator. A final copy must be filed in the Department’s purchase order file system.
Before funding preparation is complete, the City’s Rehabilitation Loan Database must be updated to include the new loan. The Program Administrator maintains this database . in Microsoft Access.
Prior to initiation of the work , the City may enter into an agr eement with an escrow company into which the loan amount will be depos ited. The standard Escrow Disbursement Agreement Form is provided in Appendix I. After each phase of work has been completed and inspected, an invoice must be submitted to the City for pay ment. It is submitted to Accounts Payable or to an escrow company cont racted by the City to have a check printed and provided to the contractor. A copy will be maintained in the permanent file. If an escrow company disburses the funds, an Authorizat ion of Loan Disbursement form, provided in Appendix J, is sent to the e scrow agent authorizing payment to the contractor. The escrow agent will follow the “Control Instructions” (a sample is provided in Appendix K) to ensure all contingencies have been meet prior to distribution of funds.
For loans existing prior to May 2007, a copy of the Promissory Note and the Loan Service Set-up Form was forwarded to the City’s loan service company . Monthly accounting statements from the l oan service company are reviewed and reconciled. The loan servicing company sends out late letters to delinquen t borrowers. In addition, the City may contact delinquent borrowers and will document all conversations, correspondence, etc., in file.
Contractor Lien Releases
After a contractor completes the approved r ehabilitation work, a request for final payment must be accompanied by a complete and signed lien release for all construction and material liens whether or not recorded against the subject property.
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Final Inspection
After all rehabilitation work is finished, the property will be inspected by the homeowner and the City to verify that the approved scope of work has been com peted. This inspection is required before the final loan disbursement will be approved.
Acceptance of Work
The City will not be a party to a construction contract. Through its rehabilitation loan and grant programs, the City provides funding to projects and assists with monitoring the project according to the approved scope of work. The City will not be a party to any claims or disputes between the owner and contractor.
In the event a dispute arises between the homeowner and the contractor concerning the contracted scope of work, the City will refer the homeowner and/or contractor to the State Board of Contractors. The c ontractor and owner agree to pr otect, defend and hold harmless the City for unpaid work, labor or materials with respect to the contractor’s performance or for the contractor’s failure to complete work or within the agreed-upon period.
Post Funding Audit
The Program Administrator is responsible fo r reviewing all application and loan documents for accuracy. Proper lien position, proper des ignation of Beneficiary/Trustor/Trustee, adherence to program guidelines, and any special issues will also be reviewed. A checklist will be provided and kept current with regard to City and CDBG requir ed file documentation .
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CHAPTER 5 - DOCUMENTATION
General
Master loan documents for the DPL loan program are prepared by the City Attorney’s Office.
Subsequently, individual l oan documents are prepared by Program Administrator in accordance with the City Attorney approved master documents.
Documents Required
The following loan documents are required for every DPL secured by real property:
Promissory Note
Deed of Trust
Truth in Lending Statement
Disclosures (e.g., Fair Lending, Lead-Based Paint)
Notice of Opportunity to Rescind Transaction
Minor Rehabilitation Environmental Review
Notice to Contractor and Homeowner
Promissory Note
As security for the City’s rehab ilitation loans, the borrower is required to sign a Promissory Note Secured by a Deed Of Trust. The Deed Of Tr ust will be recorded wit h the Office of the Orange County Clerk-Recorder. This document pr otects the City’s investment should the borrower attempt to sell the pr operty or incur additional debt agai nst the property before their loan with the City has been repaid.
For a loan on a mobile home, the borrower is r equired to allow placement of the City as the Legal Owner on the mobile home Cert ificate of Title (or as junior lien-holder if an existing loan is on the Certificate of Title) . The City must remain on the Ce rtificate of Title until the rehabilitation loan has been repaid in full.
The note defines the essential terms of the l oan and describes the repayment obligation of the borrower. Basic components include principal amount, interest rate, payment terms and default provisions. Appendix L includes a Promissory Note for single-family homes and Appendix M includes a Promissory Note for mobile homes.
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Deed of Trust
The Deed of Trust creates a lien on real property serving as co llateral for a loan. This lien excludes personal property not affixed to the land, but includes personal property that is affixed to the land including mobile homes. There are three parties to a Deed Of Trust: (1) the Trustor (the borrower), (2 ) the trustee (for City loans, the Redevelopment Agency or a City appointed title company will act as trustee), and (3) beneficiary (the City as the lender). Basic terms of the Deed of Trust include:
A description of the Promissory Note that the trust deed secures
A definition of the obli gations of the borrower that the trust deed covers
A legal description of the real property that is subject to the trust deed
Warranties and covenants
Property insurance
Events of default
Remedies
The Deed of Trust requires the Trustor’s signature to be acknow ledged in front of a Notary Public, and must be recorded with the County Re corder. A Deed of Trust form is provided in Appendix N.
Lien Against Mobile Home Title
Liens created against mobile homes on rented s paces (mobilehome parks) are processed by HCD. The formed used is entitled “Statement to Encumber” (Appendix O) or in the case of a loan in second position or junior lienholder, the form used is entitled “Statement of Lien” (Appendix P).
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Disclosures and Notices
Several different laws govern financial privacy rights. These include the California Right to Financial Privacy Act and the Feder al Right to Financial Privacy Act, both of which govern the process of releasing a borrower’s financial informa tion. Essentially, thes e regulations allow a lender to disclose a borrower’s financial records only upon the receipt of legal process or with the borrower’s written authorization. The lender is then required to notify the borrower of the receipt of legal process, unless ordered by the court not to do so.
Because credit and application information is not subject to public disclosure to anyone other than the borrower, any request for such informati on by legal process or by anyone other than the signer of the Promissory Note will be referred to the Office of the City Attorney for disposition. Written requests by the borrower for copies of financial information may be handled directly by the Program Administrator. A copy of the written request will be maintained in the loan file. Authorization to access of pr ivate information and privacy disclosure notice is provided as Appendix Q.
Various laws and regulations govern real estate-secured loans and require that lenders provide applicants with certain information. These requirements are as follows:
Truth in Lending – Regulation Z
Regulation Z is a consumer pr otection regulation that require s a lender to provide clear and understandable credit terms to consumers gr anted credit under specific situations.
Regulation Z covers credit secured by any real property for any amount when granted to consumers for personal and household pur poses. A Truth in Lending document is provided to the borrower disclosing the credit terms required by Regulation Z.
Lead-Based Paint Hazard Warning
Applicants for rehabilitation assistance (and tenants in a property being rehabilitated) must be provided with information regarding lead-based paint. Evidence of the receipt of this information must be clearly documented in the loan file
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The lead-based paint abatement requirements are determined by the amount of funding the City provides, as described in the following chart:
Required Activities to Address Lead-Based Paint
$5,000 $5,000 - $25,000 $25,000
Approach to Lead
Hazard Evaluation
and Reduction
Do no harm Identify and control
lead hazards
Identify and abate
lead hazards
Notification Yes Yes Yes
Lead Hazard
Evaluation
1. Paint Testing of
surfaces to be
disturbed by
rehabilitation
1. Paint Testing of
surfaces to be
disturbed by
rehabilitation
2. Risk assessment
1. Paint Testing of
surfaces to be
disturbed by
rehabilitation
2. Risk assessment
Lead Hazard
Reduction
1. Repair surfaces
disturbed during
rehabilitation
2. Lead safe work
practices
3. Clearance of
work site
1. Interim controls
2. Lead safe work
practices
3. Clearance of unit
1. Abatement
2. Lead safe work
practices
3. Clearance of unit
Any required lead-based paint inspections wil l be performed and paid for by the City in compliance with state and federal lead-based pa int regulations. The City will assist the homeowner in acquiring grants to pay for the treat ment or abatement of all lead-based paint found, if grant funds are available. Lead-based paint reports will be provided to the homeowner and made available to the contractors working on the property. Only a cert ified contractor can remove the lead -based paint. The contractor engaged to remove the lead-based paint will not be paid until evidence of a lead-based paint clear ance is presented to the City. Any costs associated with the remo val or clearance of lead- based paint will be added to the rehabilitation loan or grant. When these costs ex ceed the maximum loan or grant, the Director of Economic Community Development can authoriz e increasing the loan or grant to pay for these federally mandated proc edures up to a maximum loan am ount of $60,000 including the cost of building rehabilitation.
Fair Lending and Disclosure Statement
Applicants for rehabilitation assistance must be provided with information on discrimination in the provision of or in the availability of financial assistance. Evidence of the receipt of the Fair Lending Notice must be included in the loan file. A copy of the Fair lending Notice is included in Appendi x R and Regulation Z is included in Appendix S.
Processing Procedures
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Historic Preservation Compliance
Any property listed on the City, C ounty, or State Historic Survey must obtain approval from the City’s Planning DepartmentState of California Department of Parks and Recreation Office of Historic Preservation for any proposed exterior improvements. The requirement is imposed to assure that the improvements ar e compatible with the style and ar chitecture of the building, and that they maintain or enhance the character of the property.
Notice of Opportunity to Rescind Transaction
Regulation Z allows consumers t he right to cancel a loan transaction when a security interest is taken in their personal resi dence. According to the regulati on, the rescission period is three business days. No funds may be disbursed, no service may be performed, and no materials may be delivered in connection wit h the transaction until this time period has expired. The City may, however, perfect its security interest and record the Ddeed of trust Trust prior to the expiration of this time period.
Notice to Contractor and Homeowner of Contractor Provisions
The Homeowner/Contractor Agreement helps est ablish the responsibilities of the homeowner and contractor as they relate to the construction contract, pr ogram guidelines and procedures, requirements of the lender (Cit y), state and federal governmen t, and the project in general.
The homeowner and contractor must both abide by the provisions contained within the Agreement, as evidenced by their signatures, or the loan will not be funded. A sample Homeowner/Contractor Agreement is provided in Appendix T.
Safeguarding Documents
Original loan documents (e.g., Prom issory Note, Deed of Trust, mobilehome Certificate of Title) are to be maintained in a secure and fire resistant location if possible in the Economic DevelopmentCommunity Development Department or another lo cation selected by the Economic DevelopmentCommunity Development Department. A borrowers’ private information will be protected by the City to the maximum ex tent permitted by law. The City maintains and grants access to its borrowers’ information only in accor dance with its internal security standards, which restricts access to non-public personnel, or in response to a required random audit of City Housing Loan Program f iles. When a loan is paid in full or about to be paid in full, these documents will be released to a licensed escr ow company, or in certain circumstances, they will be reconveyed directly to the borrower by the City.
Processing Procedures
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CHAPTER 6 - LOAN MAINTENANCE AND ACCOUNTING
General
During the life of a loan several issues can arise which cause the City to revisit the loan file.
Some of those issues may involve defaults, partial payments, full repayment, or property insurance cancellation. This chapter addresses those situations that may occur between the time the loan has been funded and the point of full repayment of the loan.
File Organization
Loan file organization is an important aspect of loan portfolio management. Rehabilitation Loan files will be organized according to a basic credit file format. The objectives of this procedure are:
To ensure that all files contain the documentation necessary to support sound credit decisions.
To ensure that files are or ganized in a way that is effi cient and clearly understood by individuals requiring access to the files.
There are six sections to the loan file and they are as follows:
1. Correspondence (letters, documentati on and/or an accounting of events.).
2. Application: signed Loan Approval Form; co mpleted Qualifying Sheet; original loan application; required signed disclosures; inco me and asset information and verification; mortgage and rent documentation; insurance documentation; and federal tax forms.
3. Title Information/Appraisal: property profiles; appraisals; property comparable information; preliminary title reports and information; preliminary mobile home certificate of title and registration documents and in formation; completed environmental review and pictures (photographs); lead-based pain t inspection report and lead-based paint clearance (if applicable); and credit report.
4. Fund Disbursement: record of all loan funding and disbursement s, copies of all construction invoices, lien releases, disb ursement authorizations, checks issued, escrow disbursement agreement, copy of fu nding check from City and associated back up documentation.
5. Loan Documents: The original Promissory No te, Deed of Trust and/or Certificate of Title are to be stored in a safe and secure locati on. Additional documents to be retained on file include Regulation Z (or Truth in Lending Statement; Statem ent of Lien forms; Power of Attorney forms; Right of Resci ssion; final title policy; Lead-Based-Paint
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Clearance if needed; Declaration of CC&R’s if applicable; insurance declarations with the City as loss payee; loan agreements.
6. Construction Contract/Bids/Work Writ e-Up: signed accepted work write-up with insurance and license information for each a ccepted contractor, co py of original, unexecuted work write-up/inspection report. A sample copy of a Notice to Proceed in provided as Appendix U.
Accounting for Deferred Repayment Loans
DPL obligations do not require principal or interest payments to be made during the term of the loan. For that reason, the loan accounting system employed by the City uses a personal computer based database progra m. The database keeps track of each loan by amount, borrower name, address, and date.
Charge-Offs
A loan is considered a charge-off if it has been deemed uncollectible. These may be loans that have been approved for partial repaym ent or no repayment according to this Chapter, or they may be loans deemed uncollectible because of the borrower’s bankruptcy or death. In any event, the loan must be indicated as such in the database monitoring system and removed from the outstanding loan balance figures. Notice of a loan charge-off must be given to the City Treasury Department and to the City Accounting Department, with a copy to the City Attorney’s Office.
Partial Repayment Upon Sale or Refinance
If a sale or refinance of a home generates insufficient funds to fully repay the rehabilitation plus accrued interest, the Director of Economic Community Development may approve a partial payment as payment in full. Noti ce of a partial repayment must be given to the City’s Treasury Department and Accounting Depar tment with a copy to the City Attorney’s Office. The rehabilitation loan program does not allow refinancing with cash out.
Loan Payoffs
The City will generally receive a request for a payoff amount when repayment occurs as part of a property sale or mortgage refinance. The request will usually come in the form of a Request for Beneficiary’s Demand from an escrow com pany, title insurance company, or financial institution.
Due to potential errors and misunderstandings w hen discussing payoffs ver bally, the City will provide a Payoff Demand only upon receipt of a written request. The Cit y will communicate a Payoff Demand to the requester only in writing. A fee will be charged for any requested Payoff Demand. The fee is establishe d by City ordinance. A “Payoffs in Progress” file will be maintained with all loan payoff correspondence and copies of loan payoff demands with regard to loans that are in the middle of the payoff pr ocess or a detailed list of loans in the payoff process indicating the current status of the loan with regard to payoff.
Processing Procedures
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Responding to a Request for Beneficiary’s Demand
The following steps will be taken when the City has received a written request for a loan payoff demand:
Upon receipt of the payoff dem and and the fee, retrieve the loan file and review the loan agreement for repayment requirements. Check the comment section of the database for extenuating or unique circumstances that may have been documented.
Prepare a demand letter describing the principal balance, interest rate, date of loan, current date, calculation of interest to the current date, a per day interest amount for the estimated payoff date and City demand fee and reconveyances/lien removal fee.
Attach a copy of the request for beneficiary’s demand to the demand letter and send to the requesting party.
Place a copy of the demand letter and the orig inal request for beneficiary’s demand in the loan file. at the top of the right side.
If the request for a demand is from a licensed escrow and/or title company, City staff will respond by processing a Deed of Reconvey ance within 10 days after receiving full payoff of a loan. If the request is from any other representative of the borrower, the City will hold the reconveyance unt il payment is received in full and the payment check has been cleared through the bank.
The original title and registration for a mobile home and a signed Conditional Lien Release form will be sent to a licensed escrow company or title company, together with a payoff demand, provided that these doc uments were requested and are necessary to complete a pending sale transaction.
Reconveying the Trust Deed
After the City has received payment in full of “good” funds, the Deed Of Trust will be released as a lien against the property. (“Good” means funds that are drawn on a title company, escrow company, or financial institution. Funds drawn on a personal account must be cleared through the bank before reconveying the Deed Of Tr ust.) A Reconveyance of a trust deed will be prepared by City staff to be reco rded (the document will note t he borrower’s name and current address). The document will be sent directly to the Office of the Orange County Clerk- Recorder or to the entit y that provided the payoff funds; such as the title or escrow company for recordation. Upon receipt of the recorded Reconveyance document a copy of the recorded Reconveyance will be maintained in the closed l oan file and the original Reconveyance will be sent to the borrower
Defaults
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A borrower will be in default on the terms of the loan if he/she violates conditions of the loan agreement. These default issues can include the following:
Failure to occupy the home as the borrower’s primary residence.
Selling or transferring the property by any means without prior approval of the City.
Allowing the rehabilitated building (interior and/or exterior) to fall into disrepair or be kept unclean, unsafe, or out of compliance with current City building codes.
Non-payment of other mortgages , taxes, insurance, or Home owner Owner association Association dues.
Allowing the rents or income s of the tenants in duplexes, triplexes or fourplexes to exceed the affordability requirements established by this program.
Allowing the number of per sons occupying a unit to exceed the standard limits established by HUD or any other terms in t he Agreement, Promissory Note or Deed of Trust.
Any further encumbrance of the property without express wr itten authorization by the Director of Economic Community Development.
Obtain a reverse mortgage agreement.
Violation of the terms of the Regulatory Agreement as applicable.
Because of the time required to monitor these issues, the City will generally enforce only those defaults that come to the at tention of staff through the on going management of the loan portfolio. For example, if the City becomes aware of a sale transaction because a new property insurance policy has been received indicating a new owner, the City woul d pursue and expect payment in full from the origi nal borrower. To accomplish this, a demand letter would be sent to both the new owner and original borrower citi ng the sale of the property as an event of default. In such situations, at t he discretion of the Director of Economic Community Development, the property owner will be given 30 days to remedy a de fault before filing a notice of default and proceeding with foreclosure. If the event of a default the City may change a prepayment penalty up the maxi mum amount permitted by law at the discretion of the Director of Economic Community Development.
Subordination
Subordinations to new first trust deed loans are not generally permitted. In the event a borrower determines that it would be in their best interest to refinance t heir existing first trust deed loan to lower the monthly payments, the Cit y may consider subordi nation. However, the City has the right to decline a request to subordinate at its sole discretion.
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The City will consider subordination of DPL’s under the following circumstances:
1. Borrower will be refinancing thei r first mortgage at a reduced inte rest rate that results in a lower monthly mortgage payment.
2. Borrower will not be withdrawi ng or using any equity (“pulling out cash”) for any reason.
However, any fees associated with the re finance may be included in the new first mortgage.
The City may not approve a subordination that involves the following:
Withdrawal of equity for any reason.
Subordination to a loan invo lving negative amortization.
Subordination to a variable rate mo rtgage loan or reverse mortgage loan.
Change of ownership, includi ng adding new owners or co-signer(s) onto the loan or title.
The combined total of the new first mortgage loan and City’s existing second mortgage loan exceeds 80% of the appraised value of the borrower’s property.
The City’s loan will become immediately due and payable if the borrower at any time: (1) takes out any other loan against the pr operty in lieu of subordinating the City’s loan, OR (2) uses refinance proceeds to repay revolving or other debt. The City of Huntington Beach will consider subordination of rehabilitation loans if the Borrower will be refinanc ing their first mortgage at a reduced rate that results in a lower monthly mortgage payment. Fees associated with the refinance may be included in the new first mort gage. A service charge will be due to the City for processing the request. The City will not approve a subordination that involves the following:
Withdraw of equity for any reason.
Subordination to a loan invo lving negative amortization.
Subordination to a variable rate mo rtgage loan or reverse mortgage loan.
Change of ownership, includi ng adding new owners or co-signer(s) on the loan or title.
The combined total of the new first mo rtgage loan and City’s existing second mortgage loan exceeds 80% of the appraised value of the subject borrower’s property.
If the borrower takes out another loan again the property in lieu of subordinating the City’s loan or uses refinance proceeds to repay revolving or other debt the loan wi ll become immediately due and payable to the City. A Loan Subordination Policy and Applic ation form is provided in Appendix V and a Loan Subordination Request form is provided in Appendix W.
Processing Procedures
Homeowner Rehabilitation Loans and Grants Program Page 31
Closing the Loan File
After a loan has been paid in full and the correspondi ng Deed of Trust or mobilehome title has been reconveyed, the loan fi le will be closed. The Economic DevelopmentCommunity Development Department will indicate, “Paid in Full” (or another notation if appropriate) on the exterior of the file folder, and the file will be stored in a separ ate area. The loan database will be updated as well as any file required for City year-end accounting and reconciliation. Closed files should be maintained for a period not less t han five years after which the file can be destroyed but only according to the City’s file destruction process.
_______________________________________________
APPENDICIES
(PROVIDED AS EXAMPLES ONLY)
________________________________________________
_______
________________________________________
APPENDIX A
Additional Loan Requirements for Duplexes, Triplexes and Fourplexes _______
_________________________________________ Multifamily Rehabilitation Loan Application Additional Loan Requirements for Duplexes, Triplexes,
and Multi-Family Apartments
Covenants, Conditions, and Restrictions (CC&Rs) will be recorded against duplexes, triplexes, and fourplex apartments that receive rehabilitation loans or grants. The CC&Rs will reiterate the requirements of the Promissory Note and the following elements:
Eligible Income Limits:
1) Rental property owners earning less than 80% of Area Median Income; or
2) Rental property owners with renter households earning less than 80% of Area Medium Income and owner agrees to restrict rents to 30% of income based on HUD guidelines, for 51% of the units.
Rental Rehabilitation - Owner does not reside onsite:
Income verification is required for Deferred Payment Loans. The property owner must verify that 51% of the rental units are occupied by tenant earning below 80% of Area Median Income . The property owner must show proof of ownership: Grant Deed, current Property Tax Bill and mortgage statement.
Rental requirements: Owner must agree not to convert the rehabed units to condominiums over the re-payment period. In addition, rents in at least 51% of the units in each building must remain at affordable levels for the period of the loan. HUD guidelines require that rent may not be greater than 30% of gross income for households earning less than or equal to 80% of median income. The owner is required to submit annual certification of rental rates and tenant income to the Office of Business Development.
Income Restricted (Affordable) R ental Units
The property owner must restrict residency in the rental units to low-income households for the term of the City loan. The owner shall maintain records of income verification for all tenants. For the purposes of determining household income, all adult household members must be considered. Income must be verified at least annually by the owner.
The tenant leases must specify that if a tenant’s household gross income increases above the low income standard, that tenant must vacate the unit within 90 days. Should a tenant face extraordinary hardship satisfying this requirement, a written appeal may be submitted to the City. Upon receipt of a written appeal, and at the sole discretion of the Director of Economic Development Director of Community Development , this period may be extended for a period not to exceed 90 additional days.
Maximum Rents
The maximum allowable rents will be determined by applying the most restrictive rent limits established on an annual basis by: 1) California Health and Safety Code Section 50053, or 2) the HUD HOME CDBG Program Guidelines. If the tenant is required to pay for utilities, excluding telephone, the utilities cost must be deducted from the defined affordable housing cost. The currently applicable affordable housing costs and utilities allowances are available in the Economic Community Development Department office in City Hall.
Maximum Occupancy
The maximum number of persons in a household that may occupy the units will be based on the Section 8 limits established by the Orange County Housing Authority. The allowable number is determined, in part, by the sex, age, and relationship of the tenants and the total amount of living space. The generally accepted standards are as follows:
Occupancy Standards
Unit Size Maximum Occupancy
Studio 2 Persons
1 Bedroom 3 Persons
2 Bedrooms 5 Persons
3 Bedrooms 7 Persons
4 Bedrooms 9 Persons
Temporary Relocation Assistance
A. General
This section sets forth a description of temporary relocation benefits to be made available to persons and families who are displaced from their homes as a result of the City's Home Improvement ProgramRehabilitation Loans and Grants Program. Cost may be shared by the City and the displaced person(s), or landlords in the case of rental rehabilitation.
B. Conditions Requiring Temporary Relocation
If any of the following causes or conditions occur as a result of the Home Improvement Program, it may be necessary for the persons or families to relocate to another dwelling on a temporary basis:
1. Water system is shut off for any extended period of days for plumbing repairs.
2. Electrical service becomes non-operable while making repairs to wiring.
3. Repairs which create dust and other conditions which would aggravate allergic condition of occupant(s).
4. Structure is to be fumigated for termite control and infestation.
5. Hazardous living conditions which result from structural changed during construction.
6. Sanitation facilities; e.g., tub, wash basin, toilet become non-operable.
7. Contractor requires relocation of occupants to perform repairs and such requirement has the concurrence of the OCHA Housing Program Section Chief and the occupant
C. Eligibility Requirements
Applicants approved for a loan or a grant who must find temporary accommodations as per Section B above may be eligible for relocation benefits. Clients must actually secure and occupy an alternative dwelling unit in order to receive payment.
D. Amount of Assistance
Benefits may be made available for a period determined by the Program Administrator , but not to exceed the term of the rehabilitation contract. The City may pay the cost of the temporary accommodations up to a daily maximum equal to the Orange County Housing Authority rent limitation prorated on a daily basis.
E. Procedure for Securing Temporary Relocation Assistance
1. Contractor or Program Administrator must submit letter to the OBD Director of Community Development requesting vacating of unit and specifying amount of time unit must remain vacant. Request for vacating of premises must be approved, in writing, by rehabilitation·staff and authorized by Assistant City Manager
2. Person displaced presents written quote from accommodation to rehabilitation staffthe Program Administrator. , who will then verify that displaced persons occupied the unit and verify amount quoted.
3. Program Administrator will present claim form to escrow with a request for payment. Payment will be made payable, jointly, to persons displaced and persons who provided accommodation.
Subordination to City CC&Rs
The City will subordinate the rehabilitation loan to existing liens that meet the loan- to- value ratio requirements defined in this Program. The City may consider subordination of rehabilitation loans to future refinancing if the borrower will be refinancing their first mortgage at a reduced rate that results in a lower monthly mortgage payment. Fees associated with the refinance may be included in the new first mortgage. A $250 service charge will be due to the City for processing the request. The City will not approve a subordination that involves the following:
• Withdraw of equity for any reason.
• Subordination to a loan involving negative amortization. • Subordination to a variable rate mortgage loan.
• Change of ownership, including adding new owners or co- signer(s) on the loan or title.
• The combined total of the new first mortgage loan and City’s existing second mortgage loan exceeds 80% of the appraised value of the subject borrower’s property.
If the borrower takes out another loan against the property in lieu of subordinating the City’s loan or uses refinance proceeds to repay revolving or other debt the loan will become immediately due and payable to the City.
CITY OF HUNTINGTON BEACH
REHABILITATION LOAN PROGRAM MULTIFAMILY
RENTAL PROPERTY LOAN APPLICATION
This application is designed to be completed by the applicant(s). Assistance is available upon request. Applicants should complete this form as "Borrower'' or "Co-Borrower'' as applicable. Co-Borrower information must be provided for all individuals designated on the property title.
1. PROPERTY INFORMATION
Subject Property Address No. of Buildings No. of Units Year Built Name(s) on Title < Type of Structure No. of Parking Spaces Site/Lot Size Year Acquired List Utilities Included in Rent No. of Vacant Units Purchase Price Current Value First Mortgage Holder Mortgage No. Current Balance Monthly Payment Second Mortgage Holder Mortgage No. Current Balance Monthly Payment
2. APPLICANT INFORMATION
Borrower(s) will be: □ lndividual(s) □ Partnership □ Corporation □ other Partnership Type: □ General □ Limited □ Joint Venture (Attach partnership agreement) Principal Business of Partnership/Corporation ' Date of Incorporation State of Incorporation Partnership/Corporation Address Years at this Location Phone Borrower's Name Co-Borrower's Name
Home Address No. of Years at Home Address No. of Years at -- --Rent Current Address __ own --Rent Current Address % Ownership of % Ownership of
Subject Property Subject Property
Social Security Number Marital Status Birth Date Social security Number Marital Status Birth Date Dr. License No. No. of Dependents Dr. License No. No. of Dependents �nclude ages) (include ages)
Name & Address of Borrower's Employer Home Phone Name & Address of Borrower's Employer Home Phone Business Phone Business Phone
Type of Business Yrs. Employed in this line Type of Business Yrs. Employed in this line of work/profession of work/profession
Positionm!le Yrs. on this Job Positionm!le Yrs. on this Job
3. SCHEDULE OF REAL ESTATE OWNED
Please list other properties owned within the last two years by any of the above borrowers. If your percentage of ownership is less than 100%, indicate your percentage of ownership. Attach addHional sheets if necessary.
1. 2. 3. 4.
Owner Name(s)
Address of Property
'
Ownership Status
Property Description
Year Acquired
No. of Units
-
Current Value
Amount of Mortgages & Liens
Lienholder(s) Name/Address
'
Gross Monthly Rental Income
Monthly Mortgage Payment
Other Monthly Expenses
ro-Borrower's Name Co-Borrower's Name
Home Address No. of Years at Home Address No. of Years al __ Own __ Rent Current Address __ Own
--Rent Current Address
% Ownership of % Ownership of
Subject Property Subject Property
' Social Security Number Marital Status Birth Date Social Security Number Marital Status Birth Date '
Dr. License No. No. of Dependents Dr. License No. No. of Dependents ' (include ages) (include ages)
'
Name & Address of Borrower's Employer Home Phone Name & Address of Borrower's Employer Home Phone '
Business Phone Business Phone
Type of Business Yrs. Employed in this line Type of Business Yrs. Employed in this line of work/profession of work/profession
, Positionrritle Yrs. on this Job Positionrritle Yrs. on this Job ~
4. SCHEDULE OF RENTS
Please provide the following unit/tenant information for the subject property. Attach additional sheets if necessary.
Unit No. Unit No. Unit No. Unit No. Unit No. Unit No. Unit No.
No. of Bedrooms .
Household Head Name
Names of all Household
Members
'
Gross Household Income
Monthly Rent
Housing Authority Tenant?
• Briefly describe proposed
repairs to this unit
5. DECLARATIONS
If you answer "yes" to any questions below,
please explain on a separate sheet.
a. Are there any outstanding judgments against you?
b. Have you been declared bankrupt within the past 7 years? c. Have you had property foreclosed upon in the last 7 years? d. Are you currently a party to a lawsuit?
e. Are you presently delinquent or in default on any debt? f. Are you a foreign resident of the US?
6. ATTACHMENTS
Please attach the following to this application:
D Property sales agreement (if purchased)
D Ground lease(nleased)
D Partnership Agreement (if partnership)
D Recorded plat or survey
D Area map with arrow to site
D Statement of management plan
7. ACKNOWLEDGEMENT AND AGREEMENT
Borrower Co-Borrower Co-Borrower Co-Borrower
Yes No Yes No Yes No Yes No
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Breakdown & description of construction plans, specs, & costs Property income & expense statements for previous 2 years (pro-formas may be submitted if newly owned)
Year to date income & expense statement for subject property Current balance sheet for subject property
Statement of borrower's experience in owning, managing, or building multifamily buildings
□
□
□
□
□
□
Prior 2 years complete and signed federal tax returns for each applicant (or partnership/corporation, if applicable)
The undersigned specifically acknowledge(s) and agree(s) that: (1) the loan requested by this application will be secured by a deed of trust on the property or title to the property described herein; (2) the property will not be used for any illegal or prohibited purpose or use; (3) all statements made in this application are made for the purpose of obtaining the loan indicated herein; (4) occupation of the property will be as indicated l;!bove; (5) verification or reverification of any information contained in the application may be made at any time by the Lender, its agents, successors and assigns, either directly or through a credit reporting agency, from any source named in this application, and the original copy of this application will be retained by the Lender, even n the loan is not approved; (6) the Lender, its agents, successors and assigns will rely on the information contained in the application and I/we have a continuing obligation to amend and/or supplement the information provided in this application if any of the material facts which I/we have represented herein should change prior to closing; (7) in the event my/our payments on the loan indicated in this application become delinquent, the Lender, its agents, successors and assigns, may, in addition to all their other rights and remedies, report my/our name(s) and account information to a credit reporting agency; (8) ownership of the loan may be transferred to a successor or assign of the Lender without notice to me and/or the administration of the loan account may be transferred to an agent, successor or assign of the Lender with prior notice to me; (9) the Lender, Hs agents, successors and assigns make no warranties, express or implied, to the Borrower(s) regarding the property, the condition of the property, or the value of the property.
Certification: I/We certify that the information provided in this application is true and correct as of the date set forth opposite my/our signature(s) on this application and acknowledge my/our understanding that any intentional or negligent misrepresentation(s) of the information contained in this application may result in civil liability and/or criminal penalties including, but not limited to, fine or imprisonment or both under the provisions of Title 18, United States Code, Section 1001, et seq. and liability for monetary damages to the Lender, its agents, successors and assigns, insurers and any other person who may suffer afly loss due to reliance upon any misrepresentation which I/we have made on this application.
Borrower's Signature Date Co-Borrower's Signature Date
X X
Co-Borrower's Signature Date Co-Borrower's Signature Date X X
_______________________________________________
APPENDIX B
EMERGENCY REHABILITATION GRANT APPLICATION
________________________________________________
CITY OF HUNTINGTON BEACH
HOUSING REHABILITATION PROGRAM
GRANT APPLICATION
This application is designed to be completed by the applicant(s) with the Lender's assistance. Applicants should complete this form as "Bor,ower or "Co-Borrower'' as applicable. Co Borrower information must be provided for all adult household member.a and/or individuals desigriated on the property title. In such cases, Co-Borrower's income and credrt history may be used as a basis for loan qualification.
Name(s) on Title Type of Structure Year Acquired
Flrst Mortgage Holder Mortgage No. Current Balance Monthly Pa yment Second Mortgage Holder Mortgage No. Current Balance Monthly Payment Describe Improvements Planned
2. APPLICANT INFORMATION
Borrower"s Name Co-Borrower"s Name
Social Security Number Marital Status
1 8irth Date Social Security Number Marital Status
/
Birth Date
Or. License No. No. of Dependents Dr. license No. No. of Dependents (include ages) (include ages)
Current Address Own Rent Current Address Own Rent -- -- -- -- No. of Years al Current Address
I
Oa)l1ime Phone No. of Years al Current Address
1 Da)l1ime Phone
Ir residing at current address for less than two years, complete the following:
Prior Address __ Own __ Rent Prior Address __ Own __ Rent Name of Relative not Living with You
PositionlTitlelType of Business
Yrs. on this Job
Yrs. Employed in this line
of work/profession
Business Phone
Address of Relative
Name & Address or Co-Borrower's Employer
Positi on/Title/Type of Business
If employed in current position for less than two years or if currently employed in more than one position. complete the following:
Name & Address of Employer Yrs. on this Job Name & Address of Employer Reason for leaving
Position/Trtle/Type of Business Business Phone PositionfTitle/Type of Business
4. MONTHLY INCOME AND COMBINED HOUSING EXPENSE INFORMATION Yrs. Employed in this line
of work/profession
Business Phone
Yrs. on this Job
Reason for leaving
Business Phone
Gross Monthly Income: Borrower Co-Borrower Total Total Monthly Housing Expense: Total Base Employment Income Mortgage(s)
Overtime Mob�e Home Space Rent
Bonuses Hazard Insurance
Commissions Real Estate Taxes
Dividends/Interest Mortgage Insurance
Net Rental Income Homeowner Assn. Dues
Oth€r Other
Total $ $ $ Total $
5. ASSETS AND LIABILITIES
Lisi checking and savings accounts below. This schedule may be completed jointly or List liabilities below for all Borrowers. Include creditOf's name, address, and account separately by Co-Borrowers. If the Co-Borrower sedion of this application was completed, number for all outstanding debts. including auto loans, revolving charge accounts. real this schedule must be completed for both borrowers. estate loans, alimony, cllild support, etc. Use additional sheets if necessary.
Name and address of Bank. S&l, or Credit Union Name and address of Company Acct. No. Aa:t. Type Acct. No. Monthly Payment
Name on Acct. Balance Name on Acct Unpaid Balance
Name and address of Banl<. S&l, or Credit Union Name and address of Company Acct. No. Acct. Type Acct. No. Monthly Payment
Name on Acct. Balance Name onAccl Unpaid Balance
Name and address of Bank, S&L, or Credit Union Name and address of Company Acct. No. Acct. Type Acct. No. Monthly Payment
Name on Acct. Balance Name on Acct Unpaid Balance
Name and address of Bank, S&L, or Credit Union Name and address of Company Acct. No. Acct Type ' Acct. No. Monthly Payment
NameonAccL Balance Name on Acct. Unpaid Balance
Other Assets: Name and address of Company
Value of real estate owned $
Acct. No. Monthly Payment
Automobiles owned (make & year) s
Name on Acct Unpaid Balance
Other Assets $
Total Value of Assets $ Total Balam;e of Liabilities $
6. DECLARATIONS
If you answer "yes" to any question below, • Borrower Co-Borrower Please select the appropriate Race please explain on a separate sheet Yes No Yes No classification below: Borrower Co-Borrower a. Are there any outstanding judgments against you?
□□ □□
Whife
□ □
b. Have you been deciared bankrupt within the past 7 years? □□ □□
Hispanic
□ □
c. Have you had property foreclosed upon in the last 7 years? □□ □□
Black
□ □
d. /!ue ycu currenUy a party to a lawsuit?
□□ □□
American Indian
□ □
e. Are you presenUy delinquent or in default on any deb!? □□ □□
Asian
□ □ r. Wdl the subject property be your primary residence for the next 12 months? □□ □□
South Pacific Islander
□ □
9- Are you a US Citizen?
□□ □□
Other Race
□ □ 7. ACKNOWLEDGEMENT AND AGREEMENT
The IJllde<signed specifically acl<nowledge{s) and agree(s) that (t) the loan requested by this_ application wlft be serurod by a deed of trust on the property or title to the property desalbed herein; (2) the property will not be used for any illegal or prohibited purpose 0< use; (3) all statements made in this application ere made for the purpose of obtaining the loan indicated henlin; (4) oca,pation of the pcoperty will be as indicated above: (5) verification or reverification of any informa!K'.ln contained in the appfication may be made al any lime by the lender, ils agents, successors and assigns, eithe< diredly or through a a edit reporting agency. from any source named in this application. and the original copy of this appfteation wm be retained by the Lender, even if the loan is not approved; tG) the lender, its agents. successors and assigns will rely on the io/oonation contained in the eppf,cation and I/we have e continuing obrigation to amend and/or supplement the information provided in this application ff any of the material facts which I/we llave repres<>nted herein should change pno, to closing; (7) in the event rey/ou paymen1s on the loan indicated in this apprtcalion becom,, definqvent, the Landa,_ ijs agents, suc,;assors and assigns, may, in addition to an their other rights and remedies, report my/our name(s) and account information to a credJt reporting agency; (8) ownership of the loan may 08 transferred to a successor or assign of the Lender without notice to mo and/or the adminislrotion of the loan account may be transferred to an agent. soc:cassor or assign of the Lender with prior no1ica lo me; {9) the lender, its agents. successors and assigns make no warranties. express or implied, to the Borro-.ver{s) regarding the property. the condilion of the property. or the value of the property.
Certification: 1/11'1/e certify that the Information provided In thls appHcaUon Is true and correct as of the date set forth opposite my/our slgnature(s) on this applfcatlon and acknowledge my/our understanding that any Intentional or negligent misreprasentation(s} of tho Information contained In thJg appUcaUon may re.suit In dvU llabUity and/or crfmlna.l penalties including. but not limited to, fifl'e ,or imprisonment or both under the provisloM of Titfo 18, United Statas Code. Section 1001. et seq. and fiabttity for monetary damages to the lender. Its agents. succe.ssors and assigns, insunrs and any other person who may 1J.uffer any Jos.g due to reliance upon any misrepresentation which Vwe have made on thb appflcation.
Borrower's Signature Date Co-Boirower's Signature Date
X X
I j
CDBG Self Certification Form
CDBG Income Self- Certi fi cati on Form
(Confidential)
Name:
Address:
Gross Household Income per year: $
Please circle household size and appropriate income category shown below.
HUD Income Limits (Effective xxxxxxxx)
Number of Persons
Household/Family
30%
of Median
50%
of Median
51% to 80%
of Median
>81%
of Median
1 $0 - $28,500 $28,501 - $47,450 $47,451 - $75,900 >$75,901 2 $0 - $32,550 $32,551 - $54,200 $54,201- $86,750 >$86,751 3 $0 - $36,600 $36,601 - $61,000 $61,001 - $97,600 >$97,601 4 $0 - $40,650 $40,651 - $67,750 $67.751 - $108,400 >$108,401 5 $0 - $43,950 $43,951 - $73,200 $73,201 - $117,100 >$117,101 6 $0 - $47,200 $47,201 - $78,600 $78,601 - $125,750 >$125,751 Number of Persons in this Household: No. of Adults: ______ No. Of Children under 18 Household self-identified as:
Single Race Category Multiple Race Category
( ) White ( ) American Indian or Alaska Native and White ( ) Black/African American ( ) Asian and White
( ) Asian ( ) Black/African American and White
( ) American Indian or Alaska Native ( ) American Indian/Alaska Native & Black/African American ( ) Native Hawaiian or other Pacific Islander ( ) Other Are you of Hispanic/Latino Ethnicity? ( ) Yes ( ) No Are you a female head of household? ( ) Yes ( ) No I have disclosed all household income information and certify that the above household information is correct.
Print Name Signature Date Birthdate
Print Name Signature Date Birthdate
WHAT TO EXPECT AND WHAT NOT TO EXPECT
FROM THE HOUSING REHABILITATION LOAN/GRANT PROGRAM
OF HUNTINGTON BEACH
Things that Homeowners Do in the Housing Rehabilitation Program:
The program will help homeowners during the home rehabilitation process, but the homeowners are responsible for making the choice and doing the work listed below.
1. Homeowners help inspect their home and point out problems.
2. Homeowners, not the City, choose the contractors to bid on the proposed work.
3. Homeowners, not the City, hand out the work write-up list to contractors.
4. Homeowners, not the City, open & review bid proposals turned in by the contractors.
5. Homeowners, not the City, choose a contractor to perform work on their home.
6. Homeowners, not the City, sign home improvement contracts with vendors.
7. Homeowners request and approve payments made to their contractors.
8. Homeowners inspect and approve work performed by their contractors.
9. Homeowners work with contractor to settle disagreements during the job.
10. Homeowners call/write their contractors to ask them to correct problems covered by warranties during the first year after the job has been completed.
Things Homeowners Should Think About Before Taking Out a Housing Rehabilitation Loan/Grant:
1. Not all the work that homeowners want done can always be done.
2. Repairs will correct one or two problems, but will probably not solve all problems.
3. Don’t expect your house to be completely new when work is complete.
4. Don’t expect all floors, wall, ceilings, doors, windows, and so on, in older houses to be completely plumb, level and square when work is complete.
5. A lot of times, homeowners will hire small construction companies because they are able to do more work for the money than larger, more expensive, construction firms.
6. Sometimes it can be stressful living in a house while a contractor is performing work.
7. Very few times in life is anyone completely satisfied with things they buy or have repaired. Buying a house or having a house repaired is no different.
8. Houses always need improvements. It would be a good idea for owners to save at least $25 a month to help cover the cost of future repairs and maintenance.
9. Finally, the City is not a contractor, does not recommend contractors, and cannot guarantee that homeowners will be satisfied with work done by their contractors.
____________________________ Date:_____________ ___________________________ Date:___________ Homeowner Signature Co-Homeowner Signature
IRV #32687 v1
NOTIFICATION
Watch Out For Lead-Based Paint Poisoning
If this property was constructed before 1978, there is a possibility it contains lead-based paint. Please read the following information concerning lead-based paint poisoning.
Sources of Lead Based Paint
T
he interiors of older homes and
apartments often have layers of lead-based
paint on the walls, ceilings, windowsills,
doors and doorframes. Lead-based paint
and primers may also have been used on
outside porches, railings, garages, fire
escapes and lampposts. When the paint
chips, flakes or peels off, there may be a
real danger for babies and young children.
Children may eat paint chips or chew on
painted railings, windowsills or other
items when parents are not around.
Children can also ingest lead even if they
do not specifically eat paint chips. For
example, when children play in an area
where there are loose paint chips or dust
particles containing lead, they may get
these particles on their hands, put their
hands into their mouths, and ingest a
dangerous amount of lead.
Hazards of Lead-Based Paint
Lead poisoning is dangerous - especially
to children under the age of seven (7). It
can eventually cause mental retardation,
blindness and even death.
Symptoms of Lead-Based Paint
Poisoning
Has your child been especially cranky or
irritable? Is he or she eating normally?
Does your child have stomachaches and
vomiting? Does he or she complain about
headaches? Is your child unwilling to
play? These may be signs of lead
poisoning. Many times though, there are
no symptoms at all. Because there are no
symptoms does not mean that you should
not be concerned if you believe your child
has been exposed to lead-based paint.
Advisability & Availability of Blood
Lead Level Screening
If you suspect that your child has eaten
chips of paint or someone told you this,
you should take your child to the doctor or
clinic for testing. If the test shows that
your child has an elevated blood lead
level, treatment is available. Contact your
doctor or local health department for help
or more information. Lead screening and
treatment are available through the
Medical Program for those who are
eligible. If your child is identified as
having an elevated blood lead level, you
should immediately notify the
Community Development or other
agency to which you or your landlord is
applying for rehabilitation assistance so
the necessary steps can be taken to test
your unit for lead-based paint hazards. If
your unit does have lead-based paint, you
may be eligible for assistance to abate
that hazard.
Precautions to Take to Prevent Lead-
Based Paint Poisoning
You can avoid lead-based paint
poisoning by performing some
preventive maintenance. Look at your
walls, ceilings, doors, doorframes &
windowsills. Are there places where the
paint is peeling, flaking, chipping, or
powdering? If so, there are some things
you can do immediately to protect your
child:
(a) Cover all furniture & appliances;
(b) Get a broom or stiff brush and
remove all loose pieces of paint from
walls, woodwork, window wells and
ceilings;
(c) Sweep up all pieces of paint and
plaster & put them in a paper bag or wrap
them in newspaper. Put these packages
in the trash can. DO NOT BURN
THEM.
(d) Do not leave paint chips on the floor
in window wells. Damp mop floors and
windowsills in and around the work area
to remove all dust and paint particles.
Keeping these areas clear of paint chips,
dust and dirt is easy and very import; and
(e) Do not allow loose paint to remain
within your children’s reach since
children may pick loose paint off the
lower part of the walls.
Homeowner Maintenance &
Treatment of Lead-Based Paint
Hazards
As a homeowner, you should take the
necessary steps to keep your home in
good shape. Water leaks from faulty
plumbing, defective roofs and exterior
holes or breaks may admit rain and
dampness into the interior of our home. These
conditions damage walls and ceilings and cause
paint to peel, crack or flake. These conditions
should be corrected immediately. Before
repainting, all surfaces that are peeling,
cracking, chipping or loose should be
thoroughly cleaned by scraping or brushing the
loose paint from the surface, then repainted with
two (2) coats of non-leaded paint. Instead of
scraping and repainting, the surface may be
covered with other material such as wallboard,
gypsum, or paneling. Beware that when lead-
based paint is removed by scraping or sanding, a
dust is created, which may be hazardous. The
duct can enter the body either by breathing it or
swallowing it. The use of heat or paint removers
could create a vapor or fume which may cause
poisoning if inhaled over a long period of time.
Whenever possible, the removal of lead-based
paint should take place when there are no
children or pregnant women on the premises.
Simply painting over defective lead-based
painted surfaces does not eliminate the hazard.
Remember that you as an adult play a major role
in the prevention of lead poisoning. Your
actions and awareness about the lead problem
can make a big difference.
Tenant and Homebuyer Responsibilities
You should immediately notify the management
office or the agency through which you are
purchasing your home if the unit has flaking,
chipping, powdering or peeling paint, water
leaks from plumbing, or a defective roof. You
should cooperate with that office’s effort to
repair the unit.
/box1 I have received a copy of the Notice entitled
“Watch Out for Lead-Based Paint Poisoning.”
Date
Print Full Name
Signature
_______________________________________________
APPENDIX C
SINGLE-FAMILY REHABILITATION LOAN APPLICATION
________________________________________________
CITY OF HUNTINGTON BEACH
HOUSING REHABILITATION LOAN PROGRAM
SINGLE FAMILY LOAN APPLICATION
This application is designed to be completed by the applicant(s) with the Lender's assistance. Applicants should complete this form as "Borrower" or "Co-Borrower" as applicable. Co Borrower information must be provided for all adult household members and/or individuals designated on the property title. In such cases. Co-Borrower's income and credit history may be used as a basis for loan qualification.
Name(s) on Title Type of Structure
First Mortgage Holder Mortgage No.
Second Mortgage Holder Mortgage No.
Describe Improvements Planned
2. APPLICANT INFORMATION
Borrower's Name
Social Security Number Marital Status 'Birth Date
Dr. License No. No. of Dependents
(include ages)
Current Address __ Own __ Rent
No. of Years at Current Address l°aytime Phone
If residing at current address for less than two years, complete the following:
Prior Address
Name of Relative not Living with You
Position/Title/Type of Business
__ Own __ Rent
Yrs. on this Job
Yrs. Employed in this line
of work/profession
Business Phone
Year Acquired Current Value
Current Balance Monthly Payment
Current Balance Monthly Payment
Co-Borrower's Name
Social Security Number Marital Status 18irth Date
Dr. License No. No. of Dependents
(include ages)
Current Address __ Own __ Rent
No. of Years at Current Address !Daytime Phone
Prior Address __ Own __ Rent
Address of Relative
Name & Address of Co-Borrower's Employer Yrs. on this Job Position/Title/Type of Business
Yrs. Employed in this line
of work/profession
Business Phone
If employed in current position for less than two years or if currently employed in more than one position, complete the following:
Name & Address of Employer Yrs. on this Job Name & Address of Em~loyer Yrs. on this Job Reason for Leaving Reason for Leaving
Position/Title/Type of Business Business Phone Position/Title/Type of Business Business Phone
4. MONTHLY INCOME AND COMBINED HOUSING EXPENSE INFORMATION Gross Monthly Income: Borrower Co-Borrower Total Total Monthly Housing Expense: , Total Base Employment Income Mortgage(s)
Overtime Mobile Home Space Rent
Bonuses Hazard Insurance
Commissions Real Estate Taxes
Dividends/Interest Mortgage Insurance
Net Rental Income Homeowner Assn. Dues
Other Other
Total $ $ $ Total $
5 ASSETS AND LIABILITIES
list checking and savings accounts below. This schedule may be completed jointly or list liabilities below for all Borrowers. Include creditor's name, address, and account separately by Co-Borrowers. If the Co-Borrower section of this application was completed, number for all outstanding debts, including auto loans, revolving charge accounts, real this schedule must be completed for both borrowers. estate loans, alimony, child support, etc. Use additional sheets if necessary.
Name and address of Bank, S&L, or Credit Union Name and address of Company Acct No. Acct Type Acct. No. Monthly Payment
Name on Acct. Balance Name on Acct. Unpaid Balance
Name and address of Bank, S&L, or Credit Union Name and address of Company Acct. No. Acct. Type Acct. No. Monthly Payment
Name on Acct. Balance Name on Acct. Unpaid Balance
Name and address of Bank, S&L, or Credit Union Name and address of Company Acct. No. Acct. Type Acct. No. Monthly Payment
Name on Acct. Balance Name on Acct. Unpaid Balance
Name and address of Bank, S&L, or Credit Union Name and address of Company Acct. No. Acct Type Acct. No. Monthly Payment
Name on Acct. Balance Name on Acct. Unpaid Balance
Other Assets: Name and address of Company
Value of real estate owned $ Acct. No. Monthly Payment
Automobiles owned (make & year) $
Name on Acct. Unpaid Balance
Other Assets $
Total Value of Assets $ Total Balance of Liabilities $
6. DECLARATIONS
If you answer "yes" to any question below, Borrower Co-Borrower Please select the appropriate Race please explain on a separate sheet. Yes No Yes No classification below: Borrower Co-Borrower a. Are there any outstanding judgments against you?
□□ □□
White
□ □ b. Have you been declared bankrupt within the past 7 years? □□ □□
Hispanic
□ □
c. Have you had property foreclosed upon in the last 7 years? □□ □□
Black
□ □ d. Are you currently a party to a lawsuit?
□□ □□
American Indian
□ □ e. Are you presently delinquent or in default on any debt? □□ □□
Asian
□ □ f. Will the subject property be your primary residence for the next 12 months? □□ □□
South Pacific Islander
□ □ g. Are you a US Citizen?
□□ □□
Other Race
□ □ 7. ACKNOWLEDGEMENT AND AGREEMENT
The undersigned specifically acknowledge(s) and agree(s) that: (1) lhe loan requested by lhis application will be secured by a deed of trust on the property or title to the pr~ described herein; (2) lhe property will not be used for any illegal or prohibited purpose or use; (3) all statements made in this application are made for the purpose of obtaining the loan indicated herein: (4) ~pation of the property will be as indicated above; (5) verification or reverification of any information contained in the application may be made at any time by the lender, its agents, successors and assigns, eilher directly or lhrough a credit reporting agency, from any source named in this application, and the original copy of this application will be retained by the Lender, even if the loan is not approved; (6) lhe Lender, tts agents, successo,s and assigns will rely on the information contained in the application and I/we have a continuing obligation to amend and/or supplement the information provided in lhis application if any of lhe material fads which I/we have represented herein should change prior to closing; (7) in lhe event my/our payments on the loan indicated in this application become delinquent, the Lender, its agents, successors and assigns, may, in addition to all their other rights and remedies, report my/our name(s) and account information to a credit reporting agency; (8) ownership of the loan may be transferred to a successor or assign of the Lender without notice to me and/or the edministration of the loan account may be transferred to an agent, successor or assign of the Lender with prior notice to me; (9) the Lender, its agents, successors and assigns make no warranties, express or implied, to the Borrower(s) regarding the property, the condition of the property, or lhe value of the property . · Certification: I/We certify that the Information provided in this application is true and correct as of the date set forth opposite my/our signature(&) on this application and acknowledge my/our understanding that any intentional or negligent mlsrepreaentatlon(s) or the Information contained in this application may reault In civll llability and/or crimlnal penalties including, but not limited to, fine or Imprisonment or both under the provisions of TIiie 18, United States Code, Section 1001, et seq. and liability for monetary damages to the Lender, its agents, successors and assigns, Insurers and any other person who may suffer any loss due to reliance upon any misrepresentation which I/we have made on this application.
Borrower's Signature Co-Borrower's Signature
X X
CDBG Self Certification Form
CDBG Income Self- Certi fi cati on Form
(Confidential)
Name:
Address:
Gross Household Income per year: $
Please circle household size and appropriate income category shown below.
HUD Income Limits (Effective xxxxxxxx)
Number of Persons
Household/Family
30%
of Median
50%
of Median
51% to 80%
of Median
>81%
of Median
1 $0 - $28,500 $28,501 - $47,450 $47,451 - $75,900 >$75,901 2 $0 - $32,550 $32,551 - $54,200 $54,201- $86,750 >$86,751 3 $0 - $36,600 $36,601 - $61,000 $61,001 - $97,600 >$97,601 4 $0 - $40,650 $40,651 - $67,750 $67.751 - $108,400 >$108,401 5 $0 - $43,950 $43,951 - $73,200 $73,201 - $117,100 >$117,101 6 $0 - $47,200 $47,201 - $78,600 $78,601 - $125,750 >$125,751 Number of Persons in this Household: No. of Adults: ______ No. Of Children under 18 Household self-identified as:
Single Race Category Multiple Race Category
( ) White ( ) American Indian or Alaska Native and White ( ) Black/African American ( ) Asian and White
( ) Asian ( ) Black/African American and White
( ) American Indian or Alaska Native ( ) American Indian/Alaska Native & Black/African American ( ) Native Hawaiian or other Pacific Islander ( ) Other Are you of Hispanic/Latino Ethnicity? ( ) Yes ( ) No Are you a female head of household? ( ) Yes ( ) No I have disclosed all household income information and certify that the above household information is correct.
Print Name Signature Date Birthdate
Print Name Signature Date Birthdate
WHAT TO EXPECT AND WHAT NOT TO EXPECT
FROM THE HOUSING REHABILITATION LOAN/GRANT PROGRAM
OF HUNTINGTON BEACH
Things that Homeowners Do in the Housing Rehabilitation Program:
The program will help homeowners during the home rehabilitation process, but the homeowners are responsible for making the choice and doing the work listed below.
1. Homeowners help inspect their home and point out problems.
2. Homeowners, not the City, choose the contractors to bid on the proposed work.
3. Homeowners, not the City, hand out the work write-up list to contractors.
4. Homeowners, not the City, open & review bid proposals turned in by the contractors.
5. Homeowners, not the City, choose a contractor to perform work on their home.
6. Homeowners, not the City, sign home improvement contracts with vendors.
7. Homeowners request and approve payments made to their contractors.
8. Homeowners inspect and approve work performed by their contractors.
9. Homeowners work with contractor to settle disagreements during the job.
10. Homeowners call/write their contractors to ask them to correct problems covered by warranties during the first year after the job has been completed.
Things Homeowners Should Think About Before Taking Out a Housing Rehabilitation Loan/Grant:
1. Not all the work that homeowners want done can always be done.
2. Repairs will correct one or two problems, but will probably not solve all problems.
3. Don’t expect your house to be completely new when work is complete.
4. Don’t expect all floors, wall, ceilings, doors, windows, and so on, in older houses to be completely plumb, level and square when work is complete.
5. A lot of times, homeowners will hire small construction companies because they are able to do more work for the money than larger, more expensive, construction firms.
6. Sometimes it can be stressful living in a house while a contractor is performing work.
7. Very few times in life is anyone completely satisfied with things they buy or have repaired. Buying a house or having a house repaired is no different.
8. Houses always need improvements. It would be a good idea for owners to save at least $25 a month to help cover the cost of future repairs and maintenance.
9. Finally, the City is not a contractor, does not recommend contractors, and cannot guarantee that homeowners will be satisfied with work done by their contractors.
____________________________ Date:_____________ ___________________________ Date:___________ Homeowner Signature Co-Homeowner Signature
IRV #32687 v1
NOTIFICATION
Watch Out For Lead-Based Paint Poisoning
If this property was constructed before 1978, there is a possibility it contains lead-based paint. Please read the following information concerning lead-based paint poisoning.
Sources of Lead Based Paint
T
he interiors of older homes and
apartments often have layers of lead-based
paint on the walls, ceilings, windowsills,
doors and doorframes. Lead-based paint
and primers may also have been used on
outside porches, railings, garages, fire
escapes and lampposts. When the paint
chips, flakes or peels off, there may be a
real danger for babies and young children.
Children may eat paint chips or chew on
painted railings, windowsills or other
items when parents are not around.
Children can also ingest lead even if they
do not specifically eat paint chips. For
example, when children play in an area
where there are loose paint chips or dust
particles containing lead, they may get
these particles on their hands, put their
hands into their mouths, and ingest a
dangerous amount of lead.
Hazards of Lead-Based Paint
Lead poisoning is dangerous - especially
to children under the age of seven (7). It
can eventually cause mental retardation,
blindness and even death.
Symptoms of Lead-Based Paint
Poisoning
Has your child been especially cranky or
irritable? Is he or she eating normally?
Does your child have stomachaches and
vomiting? Does he or she complain about
headaches? Is your child unwilling to
play? These may be signs of lead
poisoning. Many times though, there are
no symptoms at all. Because there are no
symptoms does not mean that you should
not be concerned if you believe your child
has been exposed to lead-based paint.
Advisability & Availability of Blood
Lead Level Screening
If you suspect that your child has eaten
chips of paint or someone told you this,
you should take your child to the doctor or
clinic for testing. If the test shows that
your child has an elevated blood lead
level, treatment is available. Contact your
doctor or local health department for help
or more information. Lead screening and
treatment are available through the
Medical Program for those who are
eligible. If your child is identified as
having an elevated blood lead level, you
should immediately notify the
Community Development or other
agency to which you or your landlord is
applying for rehabilitation assistance so
the necessary steps can be taken to test
your unit for lead-based paint hazards. If
your unit does have lead-based paint, you
may be eligible for assistance to abate
that hazard.
Precautions to Take to Prevent Lead-
Based Paint Poisoning
You can avoid lead-based paint
poisoning by performing some
preventive maintenance. Look at your
walls, ceilings, doors, doorframes &
windowsills. Are there places where the
paint is peeling, flaking, chipping, or
powdering? If so, there are some things
you can do immediately to protect your
child:
(a) Cover all furniture & appliances;
(b) Get a broom or stiff brush and
remove all loose pieces of paint from
walls, woodwork, window wells and
ceilings;
(c) Sweep up all pieces of paint and
plaster & put them in a paper bag or wrap
them in newspaper. Put these packages
in the trash can. DO NOT BURN
THEM.
(d) Do not leave paint chips on the floor
in window wells. Damp mop floors and
windowsills in and around the work area
to remove all dust and paint particles.
Keeping these areas clear of paint chips,
dust and dirt is easy and very import; and
(e) Do not allow loose paint to remain
within your children’s reach since
children may pick loose paint off the
lower part of the walls.
Homeowner Maintenance &
Treatment of Lead-Based Paint
Hazards
As a homeowner, you should take the
necessary steps to keep your home in
good shape. Water leaks from faulty
plumbing, defective roofs and exterior
holes or breaks may admit rain and
dampness into the interior of our home. These
conditions damage walls and ceilings and cause
paint to peel, crack or flake. These conditions
should be corrected immediately. Before
repainting, all surfaces that are peeling,
cracking, chipping or loose should be
thoroughly cleaned by scraping or brushing the
loose paint from the surface, then repainted with
two (2) coats of non-leaded paint. Instead of
scraping and repainting, the surface may be
covered with other material such as wallboard,
gypsum, or paneling. Beware that when lead-
based paint is removed by scraping or sanding, a
dust is created, which may be hazardous. The
duct can enter the body either by breathing it or
swallowing it. The use of heat or paint removers
could create a vapor or fume which may cause
poisoning if inhaled over a long period of time.
Whenever possible, the removal of lead-based
paint should take place when there are no
children or pregnant women on the premises.
Simply painting over defective lead-based
painted surfaces does not eliminate the hazard.
Remember that you as an adult play a major role
in the prevention of lead poisoning. Your
actions and awareness about the lead problem
can make a big difference.
Tenant and Homebuyer Responsibilities
You should immediately notify the management
office or the agency through which you are
purchasing your home if the unit has flaking,
chipping, powdering or peeling paint, water
leaks from plumbing, or a defective roof. You
should cooperate with that office’s effort to
repair the unit.
/box1 I have received a copy of the Notice entitled
“Watch Out for Lead-Based Paint Poisoning.”
Date
Print Full Name
Signature
_______________________________________________
APPENDIX D
REHABILITATION LOAN QUALIFYING SHEET
________________________________________________
CITY OF HUNTINGTON BEACH
HOMEOWNER REHABILITATION LOAN PROGRAM -
QUALIFYING SHEET
1. Applicant and Loan Information
Name Telephone
Address Loan Type
Amount Current Interest Rate
2. Monthly Income Borrower Co-Borrower Total
Gross Mo. Income -$ -$ -$
Base Employment Income -$ -$ -$
Overtime -$ -$ -$
Bonuses -$ -$ -$
Commission -$ -$ -$
Dividends/Interest -$ -$ -$
Net Rental Income -$ -$ -$
Other -$ -$ -$
Total -$ -$ -$
3. Monthly Housing Expenses
Borrower Co-Borrower Total
Total Monthly Housing Expense -$ -$ -$
Mortgage(s) -$ -$ -$
Mobile Home Space Rent -$ -$ -$
Hazard Insurance -$ -$ -$
Real Estate Taxes -$ -$ -$
Mortgage Insurance -$ -$ -$
Homeowner Assn. Dues -$ -$ -$
Other -$ -$ -$
Total -$ -$ -$
4. Monthly Liabilities
Borrower Co-Borrower Total
-$
-$
-$
-$
-$
-$
-$
-$
-$
-$
-$
-$
-$
-$
-$
-$
-$
-$
Total -$ -$ -$
5. Debt to Income Ratio
-$
-$
-$
#DIV/0!
Total Hsg Exp (3) + Total Liabilities (4) / Gross Income (2) = Debt to Income Ratio
6. Loan to Value Ratio Amount
First Trust Deed -$
Second Trust Deed -$
Third Trust Deed -$
Total Encumbrances -$
Current Value -$ Estimated Future Value -$
Loan to Value Ratio (As-Is) 0% Loan to Value Ratio (After Rehab) 0%
7. Credit History
Good Comments:
Fair
Poor
None
8. Notes
Preliminary analysis and approval:
% over 50% debt to inc ratio:
#DIV/0!
Holder
Appendix D - Rehabilitation Loan Qualifying Sheet
10/11/2022
_______________________________________________
APPENDIX E
AUTHORIZATION FOR RELEASE OF INFORMATION FORM
________________________________________________
-1-
Al
l Loans and Grants
Authorization for Release of Information-HOME SF Rehab.doc Rev 3/10/04 City of Huntington Beach Housing Rehabilitation Loan Program
AUTHORIZATION
F
or Release of Information
I/We, ____________________ and ____________________ (legal name(s)), do hereby authorize any a
gencies, offices, groups, organizations or business firms to release to the CITY OF HUNTINGTON BEACH (the “City”) any information or materials which are deemed necessary to complete and verify my application for participation in the City’s Single Family Rehabilitation Loan Program (the “Program”). The information needed may include verification or inquiries regarding my identity, household members, employment and income, assets, allowances or preferences I have claimed. These organizations are to include, but are not limited to: financial institutions; Employment Security Commission; educational institutions; past or present employers; Social Security Administration; welfare and food stamps agencies; Veteran’s Administration; court clerks; utility companies; Workmen’s Compensation Payers; public and private retirement systems; law enforcement agencies; credit providers; and credit reporting agencies.
I understand that the City may conduct computer matching programs in order to verify the information supplied on my application for Program assistance. It is understood and agreed that this authorization, or the information obtained with its use, may be given to and used by the City in the administration and enforcement of the Program Policies and Procedures and that the City may, in the course of its duties, obtain such information from other Federal, State, or local agencies, including State Employment Security Agencies; Department of Defense; Office of Personnel Management, the Social Security Administration, and State welfare and food stamp agencies.
It is with my understanding and consent that a photocopy of this authorization may be used for the purposes stated above.
1. Signed: _________________________________________ Date: __________________________________
(Print Name):_________________________________________________
Date of Birth: _ __________________________
Social Security Number: ______________________________
Driver’s License/ID#_ ____________________
Address: _____________________________________________________________________________________
Number Street Name Apt./Unit # _____________________________________________________________________________________________
City State Zip Code
Home Telephone: ( ) . Work Telephone No.: ( ) .
2. Signed: _________________________________________ Date: __________________________________
(Print Name):_________________________________________________
Date of Birth: ___________________________
Social Security Number: ______________________________
Driver’s License/ID#_____________________
Address: _____________________________________________________________________________________
Number Street Name Apt./Unit # _____________________________________________________________________________________________
City State Zip Code
Home Telephone: ( ) . Work Telephone No.: ( ) .
_______________________________________________
APPENDIX F
LOAN APPROVAL FORM
________________________________________________
CITY OF HUNTINGTON BEACH
REHABILITATION LOAN PROGRAM
LOAN APPROVAL
APPLICANT AND LOAN INFORMATION
Applicant Name
Address Telephone
Loan Type
Amount Interest Rate
LOAN APPROVAL CRITERIA
Homeowner Equity Annual Household Income
Debt to Income Ratio Household Size
Credit History Income Level
Low or Moderate Very Low
Property Ownership Verification
Female Head of Household
No Yes
Enhancement Area
No Yes _______________________
__________________________
Type of Dwelling
Single Condo/Townhouse Mobile Home Redevelopment Project Area
Previous City Rehabilitation Loan or Grant
(if yes, provide details)
RECOMMENDATION FOR APPROVAL
By signing below, I certify that the information contained in this Loan Approval form has been compiled and verified by the City of Huntington Beach
__________________________________________
Submitted By
____________________________________________
Date
LOAN REVIEW COMMITTEE APPROVAL
First Approval:
Approved Denied __________________________________________ Program Administrator
____________________________________________
Date
__________________________________________________________________________________________________________________________________________ Second Approval:
Approved Denied __________________________________________ Director of Community Development Designee
____________________________________________
Date
_______________________________________________
APPENDIX G
CALIFORNIA CODE OF REGULATION TITLE 25 HOUSING
AND COMMUNITY DEVELOPMENT, SECTION 6914 –
GROSS INCOME DEFINED
________________________________________________
BARCLAYS OFFICIAL CALIFORNIA CODE OF REGULATIONS
TITLE 25. HOUSING AND COMMUNITY DEVELOPMENT
DIVISION 1. HOUSING AND COMMUNITY DEVELOPMENT
CHAPTER 6.5. PROGRAM OPERATIONS
SUBCHAPTER 2. PROGRAM ELIGIBILITY AND AFFORDABILITY FOR LOWER INCOME
HOUSEHOLDS
This database is current through 08/18/06, Register 2006, No. 33. s 6914. Gross Income.
"Gross income" shall mean the anticipated income of a person or family for the twelve month period following the date of determination of income. If the circumstances are such that it is not reasonably feasible to anticipate a level of income over a twelve-month period, a shorter period may be used subject to a redetermination at the end of such a period. "Income" shall consist of the following:
(a) Except as provided in subdivision (b ), all payments from all sources received by the family head (even if temporarily absent) and each additional member of the family household who is not a minor shall be included in the annual income of a family. Income shall include, but not be limited to:
(1) The gross amount, before any payroll deductions, of wages and salaries, overtime pay, commissions, fees, tips and bonuses;
(2) The net income from operation of a business or profession or from rental or real or personal property (for this purpose, expenditures for business expansion or amortization of capital indebtedness shall not be deducted to determine the net income from a business);
(3) Interest and dividends;
( 4) The full amount of periodic payments received from social security, annuities, insurance policies, retirement funds, pensions, disability or death benefits and other similar types of periodic receipts;
(5) Payments in lieu of earnings, such as unemployment and disability compensation, worker's compensation and severance pay (but see subdivision (b )(3)). (6) Public Assistance. If the public assistance payment includes an amount specifically designated for shelter and utilities which is subject to adjustment by the public assistance agency in accordance with the actual cost of shelter and utilities, the amount of public assistance income to be included as income shall consist of:
(A) The amount of the allowance or grant exclusive of the amount specifically designated for shelter and utilities, plus
(B) The maximum amount which the public assistance agency could in fact allow for the family for shelter and utilities,
(7) Periodic and determinable allowances such as alimony and child support payments, and regular contributions or gifts received from persons not residing in the dwelling; (8) All regular pay, special pay and allowances of a member of the Armed Forces (whether or not living in the dwelling) who is head of the family or spouse (but see subdivision (b )(5)).
Where a family has net family assets in excess of $5,000, inc~me shall include the actual , amount of income, if any, derived from all of the net family assets or IO percent of the value of all such assets, whichever is greater. For purposes of this section, net family assets means value of equity in real property other than the household's full-time residence, savings, stocks, bonds, and other forms of capital investment. The value of necessary items such as furniture and automobiles shall be excluded. (b) The following items shall not be considered as income:
(1) Casual, sporadic or irregular gifts;
(2) Amounts which are specifically for or in reimbursement of the cost of medical expenses;
(3) Lump-sum additions _to family assets, such as inheritances, insurance payments (including payments under health and accident insurance and worker's compensation), capital gains and settlement for personal or property losses; (4) Amounts of educational scholarships paid directly to the student or to the educational institution, and amounts paid by the government to a veteran for use in meeting the costs of tuition, fees, books and equipment. Any amounts of such scholarships, or payments to veterans not used for the above purposes of which are available for subsistence are to be included in income;
(5) The special pay to a serviceman head of a family away from home and exposed to hostile fire;
(6) Relocation payments made pursuant to federal, state, or local relocation law; (7) Foster child care payments;
(8) The value of coupon allotments for the purchase of food pursuant to the Food Stamp Act of 1964 which is in excess of the amount actually charged the eligible household; (9) Payments received pursuant to participation in the following volunteer programs under the ACTION Agency:
(A) National Volunteer Antipoverty Programs which include VISTA, Service Leaming Programs and Special Volunteer Programs.
(B) National Older American Volunteer Programs for persons aged 60 and over which include Retired Senior Volunteer Programs, Foster Grandparent Program, Older American Community Services Program, and National Volunteer Program to Assist Small Business Experience, Service Corps of Retired Executive (SCORE) and Active Corps of Executives (ACE).
http://web1inks.west1aw.com/Search/default.w1?RP=%2FWelcome%2FFrameless%2FSe arch%2Ewl&n= I &action=Search&bhcp= 1 &CFID=0&db=ca%2Dadc&method=TNC&q uery=ci%28%2225+CA+ADC+s+6914%22%29&recreatepath=%2Fsearch%2Fdefault% 2Ewl&RLT=CLID%5FQRYRLT141816308&RLTDB=CLID%5FDB121816308&searc h=Search§ion=6914&sp=CCR %2D 1 000&spolt=Retum+to+the+Califomia+Codeto f+Regu1ations+Service&sposu=http%3A %2F%2Fgovemment%2Ewestlaw%2Ecom%2F linkedslice%2Fdefault%2Easp%3FSP%3DCCR%2D1000&spou=http%3A%2F%2Fgove mment%2Ewestlaw%2Ecom%2Flinkedsli ce%2F default%2Easp%3 FSP%3DCCR %2D 10 00&ssl=n&strRecreate=no&sv=Split&tempinfo=FIND&title=25&RS=WEBL6.08&VR=
2.0&SPa=CCR-1000
_______________________________________________
APPENDIX H
RIGHT OF ENTRY AGREEMENT
________________________________________________
RIGHT OF ENTRY AGREEMENT
Assessment for Participants in City of Huntington Beach Housing Homeowner Rehabilitation Loans and Grants Program This RIGHT OF ENTRY AGREEMENT (“Right of Entry Agreement”) is made and entered into as of , 20___ by and between the CITY OF HUNTINGTON BEACH , a public body, corporate and politic (“City”), and _________________________________, (“Owner/s”) with respect to the following:
R E C I T A L S
A. The City has established the Homeowner Rehabilitation Loans and Grants Program Housing Rehabilitation Loan Programs (“Housing Program”) for the purpose of providing loans to low- and- moderate-income Huntington Beach homeowners and owner of rental property where low-income families live. The Housing Program objective is to provide low- cost financing to households for necessary health and safety-related housing repairs.
B. Housing Program funds will include Co mmunity Development Block Grant monies (CDBG). The Policies and Procedures for the Housing Program establish the criteria and requirements for application, eligibility and selection for a loan s amd grants , including the discretion of City to deny participation for a loan or grant under the Housing Program.
C. The Owner has applied to participate in the Housing Program seeking a loan /grant to rehabilitate their home located at ______________________, Huntington Beach, California (“Property”). As a part of the evaluation of the Owner’s application, evaluation of the financial feasibility of Owner’s eligibility to receive a loan /grant of Housing Program funds and to participate in the Housing Program, it is necessary for City and their designated agents/contractors to obtain the Owner’s consent to enter upon the Property to inspect the Property.
D. The purpose of this Right of Entry Agreement is for the Owner to permit the City and their authorized representatives to enter the Property and conduct any inspection or construction work in connection with the rehabilitation of the Property. This includes the work in compliance with Title X of the 1992 Housing and Community Development Act (Title X), which established requirements relating to lead-based paint (LBP) in housing receiving federal assistance.
NOW, THEREFORE, based on the foregoing Recitals, which are a substantive part of this Right of Entry Agreement and for good and valuable consideration, City and Owner hereby agree as follows:
1. Right of Entry . Provided that all of the terms and conditions of this Right of Entry Agreement are fully satisfied, Owner hereby grants to City and their authorized representatives the non-exclusive right to enter upon the Property to perform the inspect work on the property in consideration of eligibility for approval of a loan under the Housing Program. If Owner is selected to receive a loan /grant under the Housing Program (as determined in the sole discretion of City,) then Owner also grants to City the non-exclusive right to enter upon the Property to complete the Reduction Work, if any. All use of and entry upon the Property shall be at the sole expense of the City. 2 a. Term of Right of Entry. This Right of Entry Agreement shall commence on the date this Right of Entry Agreement is execut ed by the parties and shall automatically terminate and expire upon the completion of the inspection and construction work. b. No Property Rights Granted . It is expressly understood this Right of Entry Agreement does not in any way whatsoev er grant or convey any rights of possession, easement or other interest in the Property to the City.
2. Additional Conditions and Representations . By execution of this Right of Entry Agreement City agree as follows:
a. Compliance with Lead-Based Paint Regulations and All Applicable Governmental Requirements. All acts and work done by City at the Property will be done in a careful and reasonable manner, in accordance with the Lead-Based Paint Regulations and all applicable federal, state and local laws. b. No Mechanics Liens . City shall not permit or suffer any mechanics’, materialmen’s or other liens of any kind or nature to be filed or enforced against the Property.
3. Indemnity. Except as to the negligence and/or intentional acts of the Owner and City hereby agree to indemnify and hold harmless Owner from and against any and all damage to property or persons (but not consequential damages) arising from or attributable to conducting the inspection and construction work at the Property pursuant to this Right of Entry Agreement and to pay for or repair such damage.
4. Miscellaneous.
a. Attorneys’ Fees. In the event either party hereto brings an action or proceeding under this Right of Entry Agreement for an alleged breach or default hereof or the work contemplated hereby (“action”), the prevailing party in any such action shall be entitled to an award of reasonable attorneys’ fees and costs and expert witness fees, if any, incurred in such action or proceeding, in addition to any other damages or relief awarded.
b. Choice of Law Forum . This Right of Entry Agreement is to be governed by, and construed in accordance with, the laws of the State of California. The Municipal and Superior Courts of the State of California in the County of Orange shall have jurisdiction of any litigation between the parties arising out of or related to this Right of Entry Agreement.
c. Non-Liability of Public Officials . No officer, employee, member, agent or representative of the City shall be persona lly liable to Owner or any successor in interest, in the event of any default or breach by the City, or for any amount which may become due to Owner or its successor, or for any breach of any obligation of the terms of this Right of Entry Agreement.
3 IN WITNESS WHEREOF, the parties hereto have entered into this Right of Entry Agreement as of the date and year first set forth above.
OWNER
B y :
Printed Name:
CITY OF HUNTINGTON BEACH,
a public body, corporate and politic
B y :
I t s :
_______________________________________________
APPENDIX I
SAMPLE ESCROW DISBURSEMENT AGREEMENT
________________________________________________
PARTICTP ANT:
CONTRACTOR:
CITY OF HUNTINGTON BEACH
DEPARTMENT OF COMMUNITY DEVELOPMENT
PLANNING t BUILDING t PERMIT CENTER • ECONOMIC DEVELOPMENT • HOUSING • CODE ENFORCEMENT
ESCROW DISBURSEMENT AGREEMENT
ESCROW HOLDER/ AGENT:
Name and Address
Name and Address
Name and Address
CITY OF HUNTINGTON BEACH REPRESENTATIVE:
AMOUNT DEPOSITED:
ESCROW INSTRUCTIONS:
Representative Name and Contact
Information
$15,000.00
I. The City of Huntington Beach, Office of Business Development, hands you herewith the sum of $15,000 comprised of City grant funds, to be deposited into escrow trust account. The parties to this escrow shal I be the City of Huntington Beach and the person(s) or entity (ies) identified as the Participant. The person or entity identified as the Contractor shall not be a party to this escrow.
Should this escrow cancel, for any reason. prior to the total disbursement of the grant funds. you will be handed written instructions from ONLY the City of Huntington Beach Representative as to the disposition of the remainder of said grant funds.
All disbursement(s) will be subject to written authorization from the City of Huntington Beach by its Representative. as provided in ··Grant
Disbursement Authorization .. fonn received via facsimile, mail or handdelivery (see Exhibit ·'A'').
2. Upon receipt of authorization from the City of Huntington Beach Representative. Escrow Agent will disburse payment to Contractor (or to Participant.ONLY if designa ted on the subject authorized --Grant Disbursement Authorization" fonn) within three (3) business days. All disbursement checks and subsequent 2000
Main Street ♦ Huntington Beach CA 92648-2702 ♦ www.huntingtonbeachca.gov SAMPLE
_______________________________________________
APPENDIX J
AUTHORIZATION OF LOAN DISBURSEMENT FORM
________________________________________________
g:\community enhancement\confidential\res rehab program\policies & procedures\2022 proposed guidelines\appendix j - sample authorization of loan disbursement form.doc
SAMPLE
CITY OF HUNTINGTON BEACH
HOMEOWNER REHABILITATION LOAN PROGRAM
AUTHORIZATION OF LOAN DISBURSEMENT
Escrow#_________________________________________________________
Payment Disbursement # on this Loan:
City Loan #:
Participant/Borrower(s):
Contractor/Payee:
C o n t r a c t o r T a x I D :
I n v o i c e s # :
Huntington Beach Representative:
The City of Huntington Beach hereby authorizes Escrow Agent, Tiempo Escrow, to disburse $__________ of the loan funds now deposited in trust with Escrow Agent under the above referenced Escrow # to the above referenced Payee.
It is understood that Escrow Agent will forward a copy of each disbursement check and receipt signed by Payee to Huntington Beach Representative within three business days following each loan fund disbursement.
________________________________________________________ Signature of Authorization, City of Huntington Beach Representative
Date
_______________________________________________
APPENDIX K
SAMPLE ESCROW CONTROL INSTRUCTIONS
________________________________________________
Sample
CONTROL INSTRUCTIONS
Tiempo Escrow is hereby appointed by the undersigned as fund control holder for the sum of $_______________ in connection with a construction cont ract dated , between ___________ (hereafter referred to as ________________ (hereafter referred to as CONTRA CTOR) for construction of improvemen ts on property located at _____________, Huntington Beach CA 92648.
Tiempo Escrow is hereby instructed to hold the aforesaid sum and to disburse said sum in the following manner:
PAYMENT BREAKDOWN OF NON-CONSTRUCTION COSTS
Payment of Non-Construction Costs will be disbursed at opening of this account unless “HOLD” box is checked or otherwise noted in additional instructions below. Payments marked "HOLD" will require an Authorization for Payment.
Amount Description Payee Name (include a ddress if to be mailed) Hold Disburse $ 300.00 Fund control, processing,
& title
City of Huntington Beach
$ X Title Policy
$ 0 Appraisal
$ 0 Origination .
$ 0 Recording of N.O.C. Orange County Recorder
$ 0 Termite
$ 0 Document Prep.
$ 0 Warehousing
$ 0 Tax Service
$
$
$
$
$ 300.00 TOTAL PAYMENT OF NON-CONSTRUCTION ITEMS
$ 370.00 Contingency Amount for Construction / Rehabilitation $ 11,230.00 Construction Amount to be paid to Owner / Contractor in progress payments approved by an authorized representative of: City of Huntington Beach Name of Agency
$ 12,000.00
TOTAL AMOUNT OF FUND TO BE DISBURSED
PROGRESS PAYMENT SCHEDULE
PROGRESS PAYMENTS TO BE REQUESTED AS NEEDED BY AGENCY OR PER ADDITIONAL INSTRUCTIONS The liabilities of the fund control holder shall be confined to things specifically provided for in the Escrow Instructions.
Dated: Control Number:___________________________
By ________________________________________ ____________________________________________ CITY OF Huntington Beach
_____________________________________________
ADDENDUM TO AMERINATIONAL CONTROL INSTRUCTIONS
GENERAL PROVISIONS
Fees paid to the fund control holder shall be those heretofore specified but if fund control holder renders additional or extrao rdinary services or takes over all or completes the improvements it shall be paid in addition to the specified fee a sum equal to the reasonable value of any and all additional services rendered and money expenses and indebtedness incurred. When the fund control holder has disbursed the funds turned over to it in accordance with this agreement its obligations hereunder cease.
Fund control holder does not assume the duties of contractor or architect or guarantee the obligations of the same and is no t required to make inspections of the improvements in progress or completed and does not represent that the amount of funds deposited is sufficient to complete the improvements. However, fund control holder shall have access to property where improvements are located for purposes of inspection at all reasonable times. If funds deposited are insufficient to complete the improvements, fund control holder is not obligated to complete the improvements with its own or other funds.
In the event fund control holder becomes involved in litigation arising out of these instructions, including any suit brought by fund control holder in interpleader or to enforce the terms of these instructions, the parties hereto assign to fund control holder funds in its possession and fund control holder may apply said funds in payments of items of expenses of litigation and reasonable attorney's fees.
Fund control holder shall not have liability for:
(a) The sufficiency or correctness of form , content, execution or validity of any instrument deposited pursuant to these instructions or as to the identity, authority or rights of any person executing the same.
(b) Failure of the parties to comply with these instructions or any agreement or document filed or referred to herein.
(c) Exercise of discretion provided such exercise is authorized by or implied in these instructions.
(d) Fraud perpetrated by any person or forgeries or false impersonations occurring in connection with this fund control.
(e) Inadvertent failure to comp ly with these instructions.
(f) For any act, duty, requirement or obligation not expressly required herein or specifically stated herein.
(g) For amendments, supplements, notations, omissions or eliminations hereof or hereto not in writing signed by all partie s hereto and possession hereof not actually delivered to fund control holder.
_____________________________________________
APPENDIX L
SINGLE-FAMILY HOME
PROMISSORY NOTE
________________________________________________
CITY OF HUNTINGTON BEACH
DEPARTMENT OF ECONOMIC DEVELOPMENT
HOUSING HOMEOWNER REHABILITATION LOAN
PROGRAM
Reference APN No: ___-__-___
PROMISSORY NOTE SECURED BY DEED OF TRUST
DEFERRED REPAYMENT HOUSING HOMEOWNER REHABILITATION LOAN LOAN NUMBER DPL _____-______
The undersigned hereby promise(s) to pay the City of H untington Beach, California the principal sum of ___________ dollars with interest from __________________ until paid. The interest rate for this loan will be three percent per year simple interest. If this debt is repaid in full for any reason within two years from the date of this note, the holder of this note may, at its option, assess a prepayment penalty of 25% of the original principal amount. The unpaid principal balance and accrued interest of this debt will become immediately due at the time the property or any part of the property described in the Deed of Trust is sold, conveyed, transferred, or assigned to anyone other than the present recorded owner(s), upon further encumbrance of the property, or in t he event the undersigned cause(s) default on any of the following loan terms: (1) the undersigned agrees to make payments when due for all debts recorded against the property; (2) the undersigned agrees to live in the property as their primary residence; (3) the undersigned agrees to maintain the property in good condition internally and externally and in compliance with applicable housing standards, laws, codes, and regulations; (4) the undersigned agrees to provide evidence of fire and hazard insur ance in an amount sufficient to cover the City’s security in the property during the term of the note and to designate the City on such insurance as an additional loss payee; (5) if the property is located in a designated flood zone, the undersigned agrees to provide evidence of flood insurance; (6) the undersigned agrees to pay all property taxes and homeowner association dues during the term of the loan: (7) the undersigned agrees that loan funds are for the sole purpose of paying for housing rehabilitation activities as identified in the approved scope of work; (8) the undersigned agrees that specif ied improvements shall commence within 30 days of loan signing and all work must be completed within a period not to exceed 180 days; and (9) the undersigned agrees to hold the City harmless from and indemnify the City for and against any and all claims which may be brought or raised against the City, its officers, representatives, agents, or agencies by any party pursuant to or in any way associated with or alleged to be associated with the loan or the administration of the proceeds there from or the activities conducted pursuant thereto.
Payment shall be made in lawful money of the United States. Should default be made in payment when due and action is instituted on this note, the undersigned agrees to pay all costs of collection, including reasonable attorney’s fees.
The undersigned understand(s) that this promissory note and the accompanying deed of trust comprise the agreement for a housing rehabilitation loan to be secured by real property. By signing below, the undersigned acknowledge(s) having read and receiv ed a completed copy of the agreement and agreeing to all the terms and conditions contained therein.
___
Borrower’s Signature Printed Name Date
_____________________________________________
APPENDIX M
MOBILEHOMES
PROMISSORY NOTE
________________________________________________
CITY OF HUNTINGTON BEACH
HOMEOWNER REHABILITATION LOAN PROGRAM
PROMISSORY NOTE SECURED BY MOBILE HOME TITLE
DEFERRED REPAYMENT HOMEOWNER REHABILITATION
LOAN NUMBER DPL ___________
The undersigned hereby promise(s) to pay the City of Huntington Beach, California the principal sum of Sixteen Thousand Five Hundred Dollars ($16,500) with interest from ____ until paid. The interest rate for this loan will be 3% percent per year simple interest. If this debt is repaid in full for any reason within two years from the date of this note, the holder of this note may, at its option, assess a prepayment penalty of 25% of the original principal amount. The unpaid principal balance and accrued interest of this debt will become immediatel y due at the time the mobile home is sold, conveyed, transferred, or assigned to anyone other than the present owner(s) on title, upon further encumbrance of the property described in the title of the mobile home, or in the event the undersigned cause(s) default on any of the following loan term s: (1) the undersigned agrees to make installment payments when due for all debts owed on the property; (2) the undersigned agrees to live in the mobile home as their primary residence; (3) the undersi gned agrees to maintain the mobile home in good condition internally and externally and in compli ance with applicable housing standards, laws, codes, and regulations; (4) the undersigned agrees to provi de evidence of fire and hazard insurance in an amount sufficient to cover the City's security in the property during the term of the note and to designate the City on such insurance as an additional loss payee; (5) if the property is located in a designated flood zone, the undersigned agrees to prov ide evidence of flood insurance; (6) the undersigned agrees to pay space rent and utility asse ssments when due during the term of the loan:
(7) the undersigned agrees that loan funds are for t he sole purpose of paying for housing rehabilitation activities as identified in the approved scope of work; (8) the undersigned agrees that specified improvements shall commence within 30 days of loan signing and all work must be completed within a period not to exceed 180 days; and (9) the undersi gned agrees to hold the City harmless from and indemnify the City for and against any and all claims which may be brought or raised against the City, its officers, representatives, agents, or agencies by any pa rty pursuant to or in any way associated with or alleged to be associated with the loan or the administra tion of the proceeds there from or the activities conducted pursuant thereto. Payment shall be made in lawful money of the United States. Should default be made in payment when due and action is in stituted on this note, the undersigned agrees to pay all costs of collection, in cluding reasonable attorney's fees.
The undersigned understand(s) that a certificate of titl e to their mobile home secures this promissory note. By signing below, the undersigned acknowledge(s) having read and received a completed copy of the agreement and agreeing too all the terms and conditions contained therein.
______________________________________________________ ___________________________ Borrower’s Signature Date
SAMPLE
_______________________________________________
APPENDIX N
DEED OF TRUST DEED FORM AND PROVISIONS
________________________________________________
RECORDING REQUESTED BY
EXEMPT PER GOVERNMENT CODE 6103
AND WHEN RECORDED, MAIL TO:
Name CITY OF HUNTINGTON BEACH
Address 2000 Main Street, 5th Floor
Huntington Beach, CA 92648
Attn: Community Enhancement
Order # ______________________
Space above this line for recorders
DEED OF TRUST
BY THE DEED OF TRUST , made this _________ day of ______________, between __________________________________________________________________, Trustor, whose address is:
________________________________________________________, Hun tington Beach, CA , ___________, and Redevelopment Agency for the City of Huntington Beach, HOUSING AUTHORITY OF THE CITY OF HUNTINGTON BEACH, herein called Trustee, and the CITY OF HUNTINGTON BEACH herein called Beneficiary, Trustor grants, tran sfers, and assigns to Trustee, in trust, with power of sale, that property in Orange County, California, described as:
See Attached Exhibit “A”
Legal Real Property Description
APN NO.: _________________________________
Trustor also assigns to Beneficiary all rents, issues and profit of said realty reserving the right to collect and use the same except during continuance of default hereunder and during continuance of such default authorizing Beneficiary to collect and enforce the same by any lawful means in the name of any party hereto.
For purpose of securing:
(1) Payment of the indebtedness evidenced by one promissory note in the principal sum of $__________________________ of even date herewith, payable to beneficiary, and any extensions or renewals thereof; (2) the payment of any money that may be advanced by the Beneficiary to Trustor, or his successors, with interest thereon, evidenced by additional notes (indicating they are so secured) or by endorsement on the original note, exec uted by Trustor or his successor; (3) performance of each agreement of Trustor incorporated by reference or contained herein.
On October 25, 1973, identical fictitious De eds of Trust were recorded in the offices of the County Recorders of the State of California, the first page thereof appearing in the book and at the page of the records of the respective County Recorder as follows:
County Book Page County Book Pa ge County Book Page County Book Page Alameda 3540 89 Kings 1018 394 Placer 1528 440 Siskiyou 97 407 Alpine 18 753 Lake 743 552 Plumas 227 443 Solano 1860 581 Amador 250 243 Lassen 271 367 Rivers ide 1973 139405 Sonoma 2810 975 Butte 1870 678 Los Angeles T8512 751 Sacramento 7 31025 59 Stanislaus 2687 332 Cakaveras 368 92 Madera 1176 234 San Benito 386 94 Sutter 817 182 Colusa 409 347 Marin 2736 463 San Bernardino 8294 877 Tehama 630 522 Contra Costa 7077 178 Mariposa 143 717 San Francisco B820 585 Trinity 161 393 Del Norte 174 526 Mendocino 942 242 San Joaquin 3813 6 Tulare 3137 567 El Dorado 1229 594 Merced 1940 361 San Luis Obispo 1750 491 Tuolumne 396 309 Fresno 6227 411 Modoc 225 668 San Mateo 6491 600 Ventura 4182 662 Glenn 565 290 Mono 160 215 Santa Barbara 2486 1244 Yolo 1081 335 Humboldt 1213 31 Monterey 877 243 Santa Clar a 0623 713 Yuba 564 163 Imperial 1355 801 Napa 922 96 Santa Cruz 2358 744 File No.
Inyo 205 660 Nevada 665 303 Shasta 1195 293 San Diego 73-299568 Kern 4809 2351 Orange 10961 398 Sierra 59 439
The provisions contained in Section A, including paragraph 1 through 5, and the provisions contained in Section B, including paragraphs 1 through 9 of said fictitious Deeds of Trust are incorporated herein as fully as though set forth at length and in full herein. The undersigned Trustor requests that a copy of any notice of default and any notice of sale hereunder be mailed to Trustor at the address here in above set forth, being the address designated for the purpose of receiving such notice.
Signature___________________________________ Signature: _________________________________
(see attached Notary Acknowledgment)
Trustee
_______________________________________________
APPENDIX O
MOBILEHOME-STATEMENT TO ENCUMBER
________________________________________________
_______________________________________________
APPENDIX P
MOBILEHOME-STATEMENT OF LIEN
________________________________________________
_______________________________________________
APPENDIX Q
CREDIT REPORT AUTHORIZATION FORM
________________________________________________
CREDIT REPORT AUTHORIZATION FORM
By my signature below I, ____________________________________, authorize
____________________________________ to obtain a Background Check and / or Consumer Credit Report on me.
This authorization is valid for purposes of verifying information given pursuant to employment, leasing, rental, business negotiations, or any other lawful purpose covered under the Fair Credit Reporting Act (FCRA).
The Background Check may contain information available in the Public Domain but may not include interviews with persons other than previous employers or their agents.
By my signature below, I hereby authorize all corporations, former employers, credit agencies, educational institutions, law enforcement agencies, city, state, county and federal courts and agencies, military services and persons to release all information they may have about me including criminal and driving history. This authorization shall be valid in original or copy form.
Applicant's Name:_________________________________________________________
Social Security Number: ______-____-______ Date of Birth: ______________________
Provide Addresses for the Last 7 Years
Current Street Address: ________________________________ City: ________________
State: ________________ Start Date: ________________
Prior Street Address: ________________________________ City: ________________
State: ________________ Start Date: ________________ End Date: ________________
Prior Street Address: ________________________________ City: ________________
State: ________________ Start Date: ________________ End Date: ________________
Driver’s License #: ___________________________ State: ______________
Signature: ______________________________ Date: ___________________
**NOTE: PLEASE INCLUDE A COPY OF A VALID DRIVERS LICENSE**
_______________________________________________
APPENDIX R
FAIR LENDING NOTICE
________________________________________________
FAIR LENDING NOTICE
To: All applicants for a real property secured l oan to purchase, construct, rehabilitate, improve or refinance an owner-occupied one-to-four family residence; and all owner-applicants for a real property secured home improvement loan to improve a one-to-four family residence (whether or not owner occupied):
“The Federal Equal Credit Opportunity Act prohibits creditors from discriminating against credit applicants on the basis of race, color, religion, national origin, sex, marital status, age (provided that the applicant has the capacity to enter into a binding contract); because all or part of the applicant’s income derives from any public assistance program; or because the applicant has in good faith exercised any right under the consumer Credit Protection Act. The Federal agency that administers compliance with this law concerning this creditor is the U.S. Comptroller of the Currency, Consumer Affairs Division, Washington, D.C. 20219.”
The California Housing Financial Discrimination Act of 1977 provides in part as follows:
“35810. No financial institution shall discriminate in the availability of, or in the provision of, financial assistance for the purpose of purchasing, constructing, rehabilitating, improving, or refinancing housing accommodations due, in whole or in part, to the consideration of conditions, characteristics, or trends in the neighborhood or geographic area surrounding the housing accommodation, unless the financial institution can demonstrate that such consideration in the particular case is required to avoid an unsafe and unsound business practice.
35811. No financial institution shall discriminate in the availability of, or in the provision of financial assistance for the purpose of purchasing, constructing, rehabilitating, improving or refinancing housing accommodations due, in whole or in part, to the consideration of race, color, religion, sex, marital status, national origin, or ancestry.
35812. No financial institution shall consider the racial, ethnic, religious, or national origin composition of a neighborhood or geographic area surrounding a housing accommodation or whether or not such composition is undergoing change, or is expected to undergo change, in appraising a housing accommodation or in determining whether or not, and under what terms and conditions, to provide financial assistance for the purpose of purchasing, constructing, rehabilitating, improving, or refinancing a housing accommodation. No financial institution shall utilize appraisal practices that are inconsistent with the provisions of this part.”
If you wish to file a complaint, or if you have questions about your rights, contact:
Controller of the Currency
Administrator of National Banks
Western District
Consumer Complaint Department
50 Fremont Street
Suite 3900
San Francisco, California 94105
I (We) received a copy of this notice.
_____________________________ ____________ _________________________ ____________ Signature of Applicant Date Signature of Applicant Date _______________________________________________
APPENDIX S
TRUTH IN LENDING
REGULATION Z
________________________________________________
TRUTH IN LENDING BUYER DISCLOSURE STATEMENT
Regulation Z
Deferred Payment Loan (DPL)
Creditor: CITY OF HUNTINGTON BEACH
Borrower:
Itemization of Amount Financed: You have the right to receive at this time an itemization of the Amount Financed.
[ __ ] I want an itemization. [ __ ] I do not want an itemization.
CREDITOR’S TRUTH-IN-LENDING TO CONSUMERS
(FEDERAL DISCLOSURE BOX)
ANNUAL
PERCENTAGE RATE*
The cost of my credit as a
yearly rate: 3.0%
Simple Interest
Deferred
(if no default)
FINANCE CHARGE
The dollar amount my
credit will cost me.
$ /year
AMOUNT FINANCED
The amount of credit
provided to me or on my
behalf.
$
TOTAL OF
PAYMENTS
The amount I will have
paid after I have made all
payments as scheduled
based upon an average of
15 years since the exact
date of payoff is not
known.
$
* THE ANNUAL PERCENTAGE RATE disclosed above is a fixed rate for the life of my loan that applies if I am not in default of the terms of the Loan. In the event that I am in default of the terms of the Loan Agreement, the annual interest will be increased from 3.0% to 10.0% or the maximum amount permitted by law at the time of default, and the loan balance plus accrued interest plus penalty if any will become immediately due and payable.
2 Your Payment Schedule Will Be:
NUMBER
OF PAYMENTS
AMOUNT
OF PAYMENTS
WHEN PAYMENTS
ARE DUE
One (1) $
(Loan Amount plus accrued
interest, if any)
Due on sale, refinance, transfer,
lease, non-owner occupancy, or
default
Property Insurance: You must obtain property insurance in an amount equal to the full replacement value of the structures on the Property and name the City of Huntington Beach as loss payees.
Security: You are giving a security interest in the real property you own which is located at _________________, Huntington Beach, California 9264__.
Amount of Loan: $
Term of Loan: Due on sale, transfer, lease, refinance, non-owner occupancy, or other default.
Negative Amortization: If any of your payments is not sufficient to cover the interest due, the difference will be added to your loan amount.
Recording at County: $ 0.00 Filing Fees: $ 0.00
Prepayment: If you pay off early within 24 months, you
[X] may [ ] may not have to pay principal and accrued simple interest.
[X ] may [ ] may not have to pay a penalty of up to $3,000 or the maximum amount allowed by law at the time of default. (The purpose of this penalty is to discourage my use of this program should I desire to sell the property and profit as an investor through this use of public funds.) Interest Rate: The Loan has a base interest rate that is [X] fixed at two and one half percent (3. %) per year, unless default. [ ] variable. Disclosures about the variable-rate feature have been provided to you earlier.
3 Assumption: Someone buying your house
[ ] may, subject to conditions, be allowed to assume the remainder of the mortgage on the original terms.
[X] cannot assume the remainder of the mortgage on the original terms.
Demand Feature: This obligation
[ ] has a demand feature
[ ] has no demand feature
[X] requires repayment in full plus applicable interest and penalty upon default, sale or transfer, lease, exchange or other disposition of any interest therein, failure to occupy or default any obligation of the loan as disclosed in the Deed of Trust and the Promissory Note.
See your loan documents for any additional information about the terms for the provisions of the City Loan, default requirements, and any required repayment in full before the scheduled date.
ITEMIZATION OF THE AMOUNT FINANCED
$ Amount financed and credited to escrow
$ 0.00 Amount given to you directly
Amount to be paid to others on your behalf:
$ to loan processing, title, and escrow services
$ to contractor(s) for the work.
$ 0.00 for lead testing
$ 0.00 prepaid finance charge
I have carefully reviewed the Loan Disclosure, consisting of ____________________ pages.
Dated:
Property Owner
Dated:
Property Owner
_______________________________________________
APPENDIX T
SAMPLE CONTRACT BETWEEN HOMEOWNER
AND GENERAL CONTRACTOR
________________________________________________
DEFERRED PAYMENT LOAN
CITY OF HUNTINGTON BEACH
CONTRACT for CONSTRUCTION between OWNERS and CONTRACTOR THIS AGREEMENT ("Agreement") is made this _____ day of _________ , by and between Na me hereinafter referred to as the "OWNER" and Contractor Name, hereinafter referred lo as the "CONTRACTOR".
This instrument constitutes the sole and only agreement of the parties hereto relating to said project and correctly sets forth
the rights, duties, and obligations of each to the other as of its date. Any prior agreements, promises, negotiations, or representations not expressly set forth in this contract individually and or collectively are of no force and or effect. This agreement may be amended only by a written addendum signed by both parties.
WITNESSETH, that OWNERS and CONTRACTOR for the consideration stated herein mutually agree as follows:
1. The CONTRACTOR agrees to make repairs/improvements as stated on the approved Work Write-Up (Exhibit A) on property localed at site address, HUNTINGTON BEACH, CA 92648. , hereinafter referred to as "PROPERTY", all in strict accordance with documents for the Rehabilitation Loan Program administ ered by the City of Huntington Beach (herein after the "City").
2. Subject to the approval of OWNERS, CONTRACTOR shall furnish all supervision, labor, materials, machinery, tools, equipment, fixtures and services including transportation services and perform and complete all work described in the Scope of Work (hereinafter "Work"), Exhibit "A" to this Agreement.
3. OWNERS shall pay CONTRACTOR for performance of this contract an amount not to exceed Twenty four thousand five hundred dollars ($24,500.00), not including any additional payments for change orders pursuant to paragraph 12 below.
4. Funds shall be disbursed to CONTRACTOR for the substantial completion of Work provided that CONTRACTOR complies with the following provisions. Loan proceeds are to be disbursed to the CONTRACTOR the OWNERS or by Joint check to the Owners and Contractor for the benefit of the Owners. a. INVOICES AND CHANGE ORDERS TO BE SUBMITTED. CONTRACTOR must furnish OWNERS with printed invoice and itemized bill describing each work item as per Exhibit A and any approved change order(s). Change orders shall be submitted in writing and at minimum have all the information required under the CONTRACTORS' State Law, Business and Professions Code, Section 7159. b. RELEASE OF LIEN. CONTRACTOR must furnish OWNERS with Labor and Lien Releases covering all materials and labor pertaining to each invoice. Upon satisfactory payment being made for a portion of the work being performed, the CONTRACTOR shall, prior to any further payment being made, furnish to the OWNERS for the home improvement work, a full and unconditional release from any claim or mechanics lien for that portion of the work for which payment has been made. This requires not only the CONTRACTOR'S full and unconditional release but also full and unconditional releases from all subcontractors and material suppliers.
c. INSURANCE, LICENSE, PERMITS. CONTRACTOR shall procure and pay for all insurance, all permits, and all licenses and give all notices necessary and incident to the due and lawful prosecution of the work. CONTRACTOR must furnish OWNERS with copies of all permits prior to any payments. d. INSPECTION. CONTRACTOR and or OWNERS shall have arranged for all required building department and housing department inspections as well as any other authorities having jurisdiction over the work.
e. PAYMENT REQUESTS NOT TO EXCEED. CONTRACTOR payment requests shall not be in excess of the value of work completed at any given lime.
SAMPLE
f. DOWNPAYMENT AND PAYMENT SCHEDULE. Contracts for home improvement under this program will not include a down payment. The following payment schedule shall be used for the work:
Progress Payment(s): 90% and Final Payment: 10%
5. CONTRACTOR agrees to the following schedule for the Work:
a. COMMENCEMENT.CONTRACTOR shall commence work within 20 days of the execution of this Agreement provide that OWNERS has prepared the job site in accordance with Exhibits A and 8. Failure by the CONTRACTOR, without lawful excuse, to substantially commence work within 20 days from the approximate date specified in the contract and or notice to proceed, is a violation of the CONTRACTORS License Law. If CONTRACTOR fails to commence work within (30) days of the date of the Owners' notification to proceed, OWNERS shall have the right to terminate this agreement. b. COMMENCEMENT AND COMPLETION. CONTRACTOR shall complete all Work within 90 days from execution of this Contract and or notice to proceed.
c. OWNERS may grant CONTRACTOR an extension of time in writing for unforeseeable delays beyond the control of and without fault or negligence of CONTRACTOR, including delays caused by the OWNERS.
In the event that the CONTRACTOR fails to comply with the foregoing schedule in items a or b. above, OWNERS shall have the right to terminate this Agreement upon written notice in accordance with Paragraph 16 and or Paragraph 17.
6. Prior to the execution of this Contract, the CONTRACTOR shall submit in writing for OWNERS approval, a list of subcontractors who will be used to perform work under this contract. Requests for substitutions shall be submitted, in advance of procurement and in writing, to OWNERS and will be subject to approval of the OWNERS and the City of Huntington Beach.
7. CONTRACTOR shall perform all work in accordance with local codes and requirements, and manufacturer's recommendations whether or not covered by specifications and drawings for the work.
8. CONTRACTOR shall not assign the contract without prior written consent of OWNERS.
9. The Attached Exhibit "8" ADDITIONAL PROVISIONS shall be incorporated into and become part of this Contract.
10. CONTRACTOR shall guarantee all work, labor, and materials for a period of at least one (1) year from the date of the final inspection of all work required by the contract. CONTRACTOR shall furnish OWNERS with all manufacturers' and suppliers' written guarantees, warranties and operating instructions covering materials, appliances, and fixtures supplied or installed under this contract.
11. INSURANCE. CONTRACTOR shall at its expense, procure and maintain insurance on all of its operations, with insurance carriers, and in amounts acceptable to OWNERS as required by the contract and, including the following overages:
a. Worker's Compensation Insurance, providing coverage as required by the California State Worke~s Compensation Law.
b. Comprehensive General Liability in the minimum amounts staled below. c. Automobile Liability Insurance for owned and non-owned automobiles. d. The following contractors are excluded from the liability insurance coverage requirement:
N/A
Prior to the commencement of any construction on the Project, the CONTRACTOR shall procure and maintain, at its sole cost and expense, in a form and content satisfactory to the City and the OWNERS, during the entire term of construction, a policy of comprehensive general liability insurance. CONTRACTOR shall endorse the third party general liability coverage required herein to include as additional insured City, its officials, employees and agents. The OWNERS agrees that the provisions of this Paragraph shall not be construed as limiting in any way the extent to which the CONTRACTOR may be held responsible for the payment of damages to any persons or Site resulting from the CONTRACTOR'S activities, or actions or in actions of any person or persons for which the CONTRACTOR is otherwise responsible.
Any conditions or exclusions that limit or reduce the coverage(s) must be disclosed before starting work at the jobsite. The failure of the OWNERS to enforce in a timely manner any of the provisions of this agreement shall not act as a wavier to enforcement of any of these provisions at a later date in the performance of this agreement.
12. All CONTRACTOR and OWNERS change orders will be in writing and have approval of OWNERS and CONTRACTOR before the installation of the work. All change orders not authorized by OWNERS in writing shall not be paid. All change orders will specify exact items, sums, changes in Exhibit "A", and changes in the completion dates.
13. If CONTRACTOR is absent from PROPERTY thirty (30) consecutive calendar days without written approval from OWNERS, this contract may be unilaterally terminated by OWNERS.
14. The CONTRACTOR shall employ or cause to be employed Lead Safe Work Practices to minimize lead contaminates in the jobsite environment which may be disturbed in the performance of the work.
15. RESOLUTION OF DISPUTES. Disputes arising between OWNERS and CONTRACTOR shall be resolved as follows:
All claims and disputes relating to this contract shall be decided by arbitration in accordance with the rules of the American Arbitration Association for the construction industry. Notice of the demand for arbitration shall be filed in writing with the other party to this agreement, and shall be made within a reasonable time after the dispute has arisen. Should either party bring suit in court to enforce the terms hereof, any judgment awarded shall include court costs and reasonable attorney's fees to the prevailing party.
16. TERMINATION. In the event the CONTRACTOR fails to perform or refuses to complete the work as set forth in the schedule herein, or fails or refuses to use due diligence in performing the required alterations and improvements, and in further event that such failure, refusal or default continues for 72 hours after delivery to CONTRACTOR of a written notice to cure such default, then the OWNERS may terminate this contract by written notice to CONTRACTOR, and upon delivery of such notice, CONTRACTOR shall immediately surrender possession of the premises and remove all equipment and uninstalled materials there from.
17. TERMINATION AT WILL. The OWNERS at its sole option may terminate this agreement with 72 Hours written notice. Should a termination be made other than for CONTRACTOR'S failure to perform or the CONTRACTOR'S breach of this agreement, OWNERS shall pay CONTRACTOR the cost of the work actually completed by the CONTRACTOR in its performance of the agreement, plus 10% of such amount as and for CONTRACTOR'S overhead and profit, less, however, all sums paid CONTRACTOR prior thereto pursuant to this Agreement, and any deductions from the contract price made by the OWNERS in accordance herewith, provided, however, the total amount to be received by the CONTRACTOR pursuant to this agreement shall not in aggregate exceed the contract price. As a condition precedent to CONTRACTOR'S right to receive payment pursuant to this Paragraph, CONTRACTOR shall, upon request by OWNERS, provide written evidence satisfactory to OWNERS, including but not limited to cancelled checks, paid invoices, releases, and such other documentation as OWNERS may require, substantiating CONTRACTOR'S claims of CONTRACTOR against OWNERS. Payment pursuant to this Paragraph shall be subject to all the terms and conditions of, and procedures for, payment set forth in this Agreement.
18. INTEREST OF MEMEBERS. OFFICERS. EMPLOYEES OF A PUBLIC BODY. MEMEBERS OF LOCAL GOVERNING BODY. OR OTHER PUBLIC OFFICIALS. No member. officer. or employee of the City of Huntington Beach. or its designees or agents. no member of the governing body of the localities who exercises any functions or responsibilities with respect to the program during his tenure or for one (1) year thereafter. shall have any interest. direct or indirect. in any contract or subcontract. or the proceeds thereof. for work to be performed in connection with the program assisted under this Agreement.
19. PROHIBITION OF KICKBACKS. The CONTRACTOR hereby attests that it nor any of its officers. partners. owners. agents. representatives. employees. or parties in interest has not in any way colluded. conspired. connived or agreed. directly or indirectly with any other bidder. firm. or person to submit a collusive or a sham bid or to fix any overhead or profit or cost element of the bid price or prices in connection with this CONTRACT agreement. Furthermore. both the OWNERS and the CONTRACTOR agree that no part of the funds provided under this agreement shall be used in payment of any bonus or commission for the purpose obtaining any other benefit to the OWNERS or CONTRACTOR or its officers. partners. owners. agents. representatives. employees. or parties in interest.
20. INDEMNIFICATION. To the fullest extent permitted by law. CONTRACTOR shall forever indemnify and hold harmless the City of Huntington Beach. its officers. employees. respective heirs. consultants. and agents from and against any claims. demands. causes of actions and liability of every kind and nature whatsoever arising out of or in connection to the subject matter of this Agreement including without limitation any damages to property or injuries to persons which may be caused by any negligent act or omissions of the OWNERS and or CONTRACTOR under this Agreement. The indemnity set forth in this Paragraph shall not be limited by insurance requirements or by any other provision of this agreement.
21. Nothing in this Contract shall be construed as forming a contractual or any financial relationship of any kind between the CONTRACTOR and the City of Huntington Beach. its officers. employees. agents. consultants. and respective heirs.
OWNERS AND CONTRACTOR HAVE READ THE FOREGOING, AND UNDERSTAND AND AGREE TO EACH AND EVERY PROVISION.
________________________________ ____________________ Owner's Signature Date
_______________________________ ____________________ Contractor's Signature Date
NOTICE TO CONTRACTOR AND HOME OWNER
PLEASE READ AND SIGN AFTER CONTRACTOR SELECTION HAS BEEN MADE
C
onstruction funds for this project are funded exclusively by the City of Huntington Beach in conjunction with the City of Huntington Beach’s Low Interest Housing Rehabilitation Program.
All funds have been deposited into an account with Tiempo Escrow Company who has been given the authorization to disburse such loan funds on behalf of the City. Payments, or draws, will be made only after an inspection performed by a City-hired, rehabilitation specialist. Under no circumstances may these payments exceed 100% of the value of the work performed at that time. Make your draws coincide with completed work. The City’s authorized rehabilitation specialist will inspect the completed work within 72 hours after a request for inspection is received from either the contractor or homeowner.
If your bid is accepted by the owner, and you wish to do the work you will be required to provide an itemized cost breakdown for the job as well as a list of subcontractors who will work on the job and their phone numbers. The City and its authorized rehabilitation specialist must approve cost breakdowns. No contract will be accepted without these items. Your preliminary bid needs to include the cost breakdown or list of subcontractors.
Contractors must be aware that mechanics’ lien releases must be supplied to Tiempo Escrow before they can release a payment.
No down payment of advance money will be allowed.
All contracts must comply with California State Contractor License Law, each contract must have your California license number, beginning and completion dates, payment schedule, description of what constitutes substantial commencement of work, notices regarding Mechanic’s Liens, a right of rescission provision, the address of contractor state license board, and all other notices required under Section 7018.5 of the contractor’s license law.
Contractors are responsible for obtaining all required plans, permits and inspections. No payments will be made where those requirements are not met.
New medium grade materials must be used on all projects unless specifically agreed to in writing by the City and owner.
If you are doing any painting on the job, no lead based paint may be used.
Absolutely no changes will be allowed to the contract without prior written approval from the City and the owner.
All work must be performed to code and workmanship must meet acceptable standards of the industry.
CONTRACTOR: Indicate by completing the following statement that this form will become the last page of your contract.
This is page # 5
of my Contract #1 dated _______________. My initials: __________
This contract is contingent upon the City’s approval of the Rehabilitation Loan funds.
I have read and received a copy of this form. I agree to abide by all the above rules.
_____________________________________________
Contractor’s Signature Date
___________________________________________ _______________________________________________ Homeowner’s Signature Date Homeowner’s Signature Date
_______________________________________________
APPENDIX U
NOTICE TO PROCEED
________________________________________________
CITY OF HUNTINGTON BEACH
DEPARTMENT OF COMMUNITY DEVELOPMENT
PLANNING ♦ BUILDING ♦ PERMIT CENTER ♦ ECONOMIC DEVELOPMENT ♦ HOUSING ♦ CODE ENFORCEMENT
2000 Main Street ♦ Huntington Beach CA 92648-2702 ♦ www.huntingtonbeachca.gov
___, 2022
Contractor Name and Address
NOTICE TO PROCEED
Rehabilitation Project: ____ (address)
Huntington Beach, CA 9264_
Mr. and/or Ms. ___ (Property Owner)
Dear (contractor):
You are hereby notified to commence and proceed with the above referenced rehabilitation project as per the executed Owner/Contractor Agreement, according to the schedule agreed upon by you and the above
referenced homeowner.
If possible, work shall begin within (30) calendar days after receipt of this Notice.
Contractor’s failure to commence work, without lawful excuse, within 30 days from the date specified above may cause the cancellation of the contract by the property owner as failure to perform. The work shall be
completed by ___ ___, 202_ (90 days from above date).
Sincerely,
Robert G. Vasquez
Housing Consultant
cc: Owner, as referenced above.
_______________________________________________
APPENDIX V
LOAN SUBORDINATION POLICY AND
APPLICATION FORM
________________________________________________
CITY OF HUNTINGTON BEACH
HOMEOWNER REHABILITATION LOAN PROGRAM
LOAN SUBORDINATION POLICY
DATE: _____________________
TO: Borrowers and Lenders
The City of Huntington Beach will consider subordination of City of Huntington Beach Homeowner Rehabilitation Loan Program loans under the following circumstances:
1. Borrower will be refinancing their first mortgage at a reduced interest rate that results in a lower monthly mortgage payment.
2. Borrower will not be withdrawing or using any equity (“pulling out cash”) for any reason.
However, any fees associated with the refinance may be included in the new first mortgage.
The City will not approve a subordination that involves the following:
Withdrawal of equity for any reason
Subordination to a loan involving negative amortization Subordination to a variable rate mortgage loan
Change of ownership, including adding new owners or co-signer(s) onto the loan or title. The combined total of the new first mortgage loan and City’s existing second mortgage loan exceeds the appraised value of the subject borrower’s property.
PLEASE NOTE: The City’s loan will become immediately due and payable if the borrower at any time:
(1) takes out any other loan against the property in lieu of subordinating the City’s loan, OR (2) uses refinance proceeds to repay revolving or other debt.
The following items are required by the City of Huntington Beach at the time that a subordination request submitted:
1. Fee: A service charge for processing of the request. Payment should be made to the City of Huntington Beach. Payment of this fee may be made through escrow.
2. Required Documentation (copies are acceptable):
Borrower’s loan application for the new first mortgage loan Credit Report
Estimated Closing Statement
Preliminary Title Report
Escrow Instructions
Truth in Lending Statement (Regulation Z)
Appraisal
The following items will be required at the close of escrow:
1. Copy of HUD I Settlement Statement.
2. Lender’s policy of title insurance naming either: (1) the Housing Authority of the City of Huntington Beach OR (2) the City of Huntington Beach, a municipal corporation, as additional insured as shown on the title report, depending upon the vesting of the City’s existing deed of trust.
3. Proof of hazard insurance naming either: (1) the Housing Authority of the City of Huntington Beach OR (2) the City of Huntington Beach, a municipal corporation, as additional insured as shown on the title report, depending upon the vesting of the City’s existing deed of trust.
Please forward the required items to the following: City of Huntington Beach Community Enhancement
2000 Main Street, 5 th Floor
Huntington Beach, CA 92648
Processing Time: (Please allow sufficient time for loan closing to accommodate this process)
Subordination requests will be responded to with in 10 days after they are received by the Economic Development Department.
A Subordination Agreement will be available within 30 days following the receipt of the subordination request provided all City requirements have been satisfied.
A subordination request that does not meet the City’s requirements will be denied.
DUE TO VOLUME, THE ABOVE INFORMATION CANNOT BE ACCEPTED BY FAX. If you have any questions, please call (714) 536-5470.
_______________________________________________
APPENDIX W
LOAN SUBORDINATION REQUEST FORM
________________________________________________
HUNTINGTON BEACH HOMEWONER REHABILITATION LOAN PROGRAM
LOAN SUBORDINATION REQUEST
(Please submit with additional information outlined in Loan Subordination Policy letter) LENDER: ________________________________________________________________ LENDER TELEPHONE ____________________________________________________ LENDER ADDRESS: ____________________________________________________ ____________________________________________________________________________ ESCROW COMPANY: ____________________________________________________ ESCROW ADDRESS: ____________________________________________________ CONTACT PERSON: ____________________________________________________ ESCROW NO.: ____________________________________________________ ESCROW PHONE #: ____________________________________________________ NAME OF BORROWER(S): ____________________________________________________ PROPERTY ADDRESS: ____________________________________________________ ASSESSOR PARCEL NO.: ____________________________________________________ ORIGINAL First Mortgage Loan
AMOUNT OF NOTE: $___________________________________________________ DATE OF NOTE: ____________________________________________________ INTERST RATE: __________________ ٱFixed ٱARM
NEW First Mortgage Loan
NAME OF MORTGAGE HOLDER: ______________________________________________ LOAN AMOUNT: $___________________________________________________ COSTS TO BE ROLLED INTO THE NEW LOAN: $___________________________ INTEREST RATE: _________ % ٱFixed ٱARM
_________________________________________ ____________________________ Name Printed/Signature of Lender/Broker Date
OFFICE USE
Date Received: ________________ ٱApproved ٱDenied Date:
BY: _____________________________ BY: ____________________________