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HomeMy Public PortalAbout12-22-1998LRA_sp~vtNWOOO ~~ ~- z?r' ,r. ., b ~`~~y~E ~` ~ ~ LYNWOOD REDEVELOPMENT AGENCY -'~~Q~w ~p-~,~N~C~~ 11330 BULLIS ROAD LYNWOOD, CALIFORNIA 90262-3845 (310) 603-0220 .---,. ~~ ~ ~n~l ~~.~Vrso~d CITY O~ LYNWCp~ AGENDA CITY CLEf;;<S pFFICI pEC ~ 1 1~ sale LYNWOOD REDEVELOPMENT AGENCY ~'gSp~~~E~6~0~0~@3141 ~ ~~~. - DECEMBER 22, 1998 ~, ~ , SPECIAL MEETING 9:00 A.M. LYNWOOD CITY HALL, 11330 BULLIS ROAD RICARDO SANCHEZ CHAIRMAN LOUIS BYRD VICE CHAIRMAN ARTURO REYES MEMBER INTERIM EXECUTIVE DIRECTOR RALPH DAVIS OPENING CEREMONIES: A. Call Meeting to Order. ARMANDO REA MEMBER PAUL RICHARDS MEMBER AGENCY COUNSEL SHAN K. THEVER B. Roll Call (BYRD-REA-REYES-RICHARDS-SANCHEZ) C. Certification of Agenda Posting by Secretary. PUBLIC ORAL COMMUNICATION PUBLIC ORAL COMMUNICATIONS (Regarding Agenda Items Only) 1. LYNWOOD REDEVELOPMENT AGENCY APPROVAL OF THREE NEW AFFORDABLE HOUSING PROGRAM. 1 Comments: To request approval from the Redevelopment Agency on a new Housing Rehabilitation Program, and a new First -Time Homebuying Program utilizing HOME Investment Partnership funds and the Lynwood Redevelopment Agency 20% Set-Aside Low/Moderate Income Housing funds. Recommendation: Staff request that after consideration of the above facts the Redevelopment Agency adopt the three attached resolutions, with necessary funding transfer appropriations,. approving the Housing Rehabilitation Program, The Purchase and Rehabilitation Program, and the First-Time Homebuying Program and direct the Executive Director to pursue the necessary program approvals for .HUD, as required, and to obtain the necessary additional staff necessary to implement the program. 2. MID-YEAR BUDGET. WORKSHOP. CLOSED SESSION 3. THE REDEVELOPMENT AGENCY SHALL CONVENE TO CLOSED SESSION PURSUANT TO SECTION 54956.8 CONFERENCE WITH REAL PROPERTY NEGOTIATOR. Developer: BEST PACKAGING LOAN REQUEST. Comments: To present the Agency with a draft agreement between the Agency and Best Packaging relative to a $100,000 business loan for start up business expenses. Recommendation: Staff recommends that the Redevelopment Agency direct staff as to what course of action the Redevelopment Agency wished to take. .ADJOURNMENT Motion to adjourn to a Regular Meeting of the Lynwood Redevelopment Agency to be held. January 5, 1999 at 6:00 p.m. in the Council. chambers of City Hall, 11330 Bullis Road, Lynwood, California. 2 i DATE: November 23, 1998 TO: HONORABLE CHAIRMAN AND MEMBERS OF THE AGENCY FROM: Ralph Davis, Interim Executive Director BY: Gary Chicots, Community Development Director SUBJECT: Lynwood Redevelopment Agency Approval of three New Affordable Housing Program Purpose: To request approval from the Redevelopment Agency on a new Housing Rehabilitation Program, a new. Purchase and Rehabilitation Program, and a new First -Time Homebuying Program utilizing HOME Investment Partnership funds and the Lynwood Redevelopment Agency 20% Set-Aside Low/Moderate Income Housing funds. Background On November 23,1998, staff reported to the City Council on the status update to the HOME Investment . Partnership funds. Within the report staff identified several new housing programs that the City Council . could initiate utilizing a combination of HOME funds and Redevelopment Set Aside funds. Staff was directed to prepare the program specifications and bring the new program information back to the appropriate body for review and approval. Staff has prepared three new affordable housing programs for the Redevelopment Agency's approval. The three new programs are a Residential and Multi-Family Rehabilitation Program, a Housing Purchase and Rehabilitation Program, and aFirst -Time Homebuying Program. The new. programs have been designed to expand the supply of decent, safe, sanitary, and affordable housing within the City, in addition these affordable housing programs are capable of providing a workable solution to the community's problems of neighborhood deterioration, escalating property disinvestment, decreasing property values, and ultimately, a measurable loss in the quality of life within the community. The HOME Investment Partnership funds and the Redevelopment 20% Set-Aside Low/Moderate Income Housing funds have been identified as eligible funding sources for the three activities. Utilizing these affordable housing entitlement and tax increment funds will allow the City the opportunity to annually invest HUD funds that have limited spending schedules and meet the established housing goals within the City of Lynwood. Each fiscal year,. the City of Lynwood has executed an administrative agreement with the Lynwood Pedevelopment Agency (LRA) utilizing the agency as a subrecipient of the HOME funds. This administrative agreement authorizes the L,RA to execute- the new affordable housing programs and to comply with all administrative requirements, pursuant to the Department of Housing and Urban Development Title 24 CFR, Section 92. Analysis An analysis of the housing delivery system in the City of Lynwood revealed a past history of unavailable housing programs to a community that has a progressively aging housing stock, abandoned homes, and overcrowded living conditions. Since 1992 the City has been receiving HOME funds in addition to Redevelopment Agency Set-Aside funds to address the housing needs. These funds must be utilized to help bridge the gap in Lynwoods housing delivery system by making housing programs available.. The three housing programs presented address the high priority housing needs identified in the approved Consolidated Plans five year strategy and are designed to replenish the existing housing stock, provide homeownership opportunities and rebuild blighted neighborhoods. A brief description and budget for each program is listed below: Residential. and Multi-Family Housing Rehabilitation -The residential rehabilitation program will be targeted to the low and moderate homeowners and will offer financial and technical assistance to repair code violations and basic housing repairs. The City will offer a deferred loan amount up to $30,000 for single family dwellings and grant amount up to $5,000 for single family dwellings.. The multi-family loan program will offer a deferred loan in the amount of $45,000 to assist in needed repairs such as code violations, health and safety issues, and cosmetic repairs to the large population of rental properties. (See attached flowchart "A") AG:~::iQL:'~ ~`sL~ll ` The total program budget for the Housing Rehabilitation Program for F.Y. 1998-99 is as such: Total Budget for F.Y 1998-99 $71s.ooo Funding Source/Amount HOME - $450,000 • Set-Aside - $266,000 Operating Budget (Max. 10% of budget) Personnel $25,000 Office Supplies $ 300 Operating Supplies $ 350 Prof. & Cont. Services. $15,000 Advertising & Print $ 350. ' ~ Total $41,000 - .Dollars available for.Single Family Deferred Loans. $240,000 - 8 Loans at a max. loan amount of $30,000 .per applicant Dollars available for Single Family Grants. $ 75,000 - 15 Grants at a max, grant amount of $5,000 per application Dollars available for Multi-Family Rehab. $360,000 - 8 Loans at a max. loan amount of $45,000 per applicant Currently, the existing single family housing rehabilitation program has been receiving its annual funding from the CDBG entitlement grant. This years'allocation is $285,000. The existing program offers financial assistance in the .form of a deferred loans up to $20,000 and aemergency/senior grant up to $3,000. By ' utilising HOME funds and LRA Housing funds to upgrade. the program the City will be able to reprogram the currently allocated funds to other CDBG activities that are in need of additional funding such as the street improvement projects, and the natatorium rehabilitation. ' Purchase and Rehabilitation Program -The program has been established to enable the City to purchase and rehabilitate properties abandoned and currently owned by the Housing and Urban Development (HUD) and other bank-Real Estaie Owned (REO) properties that are located in the City. Properties once purchased will be rehabilitated and made available for immediate resale to eligible low income households. Homes sold to low income families may include .First Time Homebuying loans to reduce the new buyers .loan amount making it easier for the buyer to qualify for a new first loan. Proceeds from the sale of the properties will be used to replenish the program cost and to purchase another . property. It is anticipated that the HUD .homes will be purchased at a discount of 10 - 30%. Other bank REO's will be .purchased at the lowest ne gotiated price. (See Flowchart "B"). The total program budget for the Purchase. and Rehabilitation program for F.Y. 1998-99 is as such: Total Budget for F.Y. 1998-99 750 000 Funding Source/Amount HOME - $400,000 Set-Aside - $350,000 Operating Budget (Max. 10% of budget) Personnel $50,000 Office supplies $ 300 .Operating Supplies $ 350 ' Prof. & Cont. Services $24,000 Advertising & Print 350 Total $75,000 Dollars available for property acquisition $460,000 - 4 houses at $1 L5,000 per house Dollars available for rehabilitation of . acquired properties $215,00 -Total cost per house $53,750 First -Time Homebuying Program (FTHB) -The FTHB program has been developed to provide first time homebuyers with the financial assistance necessary for homeownership and to create an opportunity for low/moderate income families to own there own home. The loan is in the form of a deferred payment second mortgage with a dollar amount up to $20,000. The FTHB program. is designed to assist qualified households with down payment, closing cost, and any additional costs for the purchase of a home in the City of Lynwood. (See flowchart "C"). The total program budget for the First-Time Homebuying Program for F.Y. 1998-99 is as such: Total Program Budget for F. Y. 1998-99 10 000 Funding Source/Amount HOME - Set-Aside - Operating Budget (Max. 10% of budget) Personnel $35,000 Office Supplies $ 300 Operating Supplies $ 350 $255,000 $255,000 • Prof. & Cont.' Services $14,000 Advertising & Print $ 350 Total $50,000 Dollars available for deferred loans $460,000 - 23 loans at a max. loan amount of $20,000 per applicant. .Staff has prepared the program regulations, a complete budget, and flow chart for each program in compliance with HUD/HOME regulations at 24 CFR Part 92. The Housing Rehabilitation and' the .Purchase and Rehabilitation program manual has been combined into one program regulations manual, the FTHB program has a separate program manual {See Attached). Once the programs are approved by the Redevelopment Agency the Housing Rehabilitation program can be immediately initiated. However, staff will need to notify HUD and the community of the use of funds for. the Purchase and Rehabilitation program and the FTHB program. It is anticipated that it will take approximately 60 days to complete the statutory requirements for notification and publication .to the community and .HUD before those two programs .are up and running. It should be noted that additional staff may be needed to implement the three new programs. The initial dollar amount invested in the three pilot programs utilizing HOME Investment Partnership funds will be as such: Housing Rehabilitation $450,000 Purchase and Rehabilitation Program - $400,000- First-Time Homebuyers Program 2 00 Total $1,105,000 The initial dollar amount invested in the three .pilot programs utilizing Redevelopment Set- Aside funds will be as such: Housing Rehabilitation $266,000 Purchase and Rehabilitation Program $350,000 First-Time Homebuyers Program 255 00 Total $871,000 The initial investment of $1,105,000 of HOME funds into the three pilot programs will allow the City to commit a backlog of HOME funds, including the 1994 allocation of $224,600, and eliminate the threat of HUD deobligating any portion of the City's past allocations, as well as end the existing search for hopeful uses of the funds by creating an ongoing list of program activities the City can annually fund. This will prevent a future buildup of allocations of HOME funds. Following is a list of HOME funds that will be committed once the pilot programs have been approved and the HOME funds remaining after program approvals 1994 Regular HOME Funds $224,600 1995 Regular HOME Funds $360,000 1996 Regular HOME Funds $426,000 1997 Regular HOME Funds $416,000 1998 Regular HOME Funds 438 00 Total $1,864,600 Total Dollar amount for the three pilot programs $1,105,000 Total amount of uncommitted/spent HOME funds 1 864 00 Amount remaining to be committed to a project or program $ 759,600 The remaining $759,600 represents $321,600 of the 1997 HOME funds and the complete 438,000 of the 1998 HOME funds. These funds can be invested in other affordable housing~activities in the near future, or included in the F.Y. I999-2000 program budgets for the new programs presented here. Recommendation Staff request that after consideration of the above facts the Redevelopment Agency adopt the three attached. resolutions, with the necessary funding transfer appropriations, approving the Housing Rehabilitation Program, The Purchase and Rehabilitation Program, and the First-Time Homebuying Program and direct the Executive Director to pursue the necessary program approvals for HUD, as required, and to obtain the necessary additional staff necessary to implement the programs . Attachments 1. Rehabilitation Program Regulations, Budget, and Flow Chart 2. First -Time Homebuying Program Regulations, Budget and Flow Chart 3. A Resolution for each new Affordable Housing Program • • ' RESOLUTION NO. A RESOLUTION OF THE REDEVELOPMENT - AGENCY OF THE CITY OF LYNWOOD APPROVING A HOUSING REHABILITATION PROGRAM PURSUTANT TO TITLE 24CFR, PART 92, AND TO COMIVIITT $450,000 OF HOME INVESTMENT ' PARTNERSHIP FUNDS AND $266,000 OF REDEVELOPMENT 20% SET-ASIDE LOW/MODERATE INCOME HOUSING. FUNDS TO CARRY OUT THE NECESSARY PROGRAM ACTMTIES WHEREAS, The Redevelopment Agency is interested in starting a new Housing •Rehabilitation Program pursuiant HUD/HOME guidelines at title 24 CFR, Part 92; and WHEREAS, The new Housing Rehabilitation Program has been designed to expand the supply of decent, safe, sanitary and affordable housing within the City; and WHEREAS, $450,000 of The HOME Investment Partnership funds and $266,000 of the Redevelopment 20% .Set-Aside Low/Moderate Housing Funds have been identified as eligible funding sources. for the program; and - ' WHEREAS, In order to proceed ,funds from the Unappropriated HOME funds need to be appropriated to carry out the financial terms of the Housing Rehabilitation Program NOW,THEREFORE, The Redevelopment-Agency does hereby resolve as follows: - Section 1. That the Redevelopment Agency approve the Housing Rehabilitation Program for the City, of Lynwood. Section 2. That the Executive Director is authorized to make the following fund appropriation and transfer . FROM Tp Unappropriated HOME Funds Fund 34-4135-4220 HOME Program $450,000 $450,000. AND FROM Unappropriated Redevelopment Set-Aside Low/IVloderate Housing Fund $266,000 Andrea L. Hooper, Secretary APPROVED AS TO FORM - Shan K. Thever, Esq Director Agency Special Councel TO Fund 34-4135-4220 HOME Program $266,000 Ricardo Sanchez, Chairman Ralph Davis, Interim Executive Director APPROVED AS TO CONTENT Gary Clucots, Community Development - RESOLUTION NO. A RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF LYNWOOD APPROVING A PURCHASE AND REHABII.ITATION PROGRAM PURSUTANT TO TITLE 24CFR,~ PART 92, AND TO COMIVIITT $400,000 OF HOME INVESTMENT PARTNERSHIP FUNDS AND. $350,000 OF REDEVELOPMENT 20% ' ~ SET-ASIDE LOW/MODERATE INCOME HOUSING FUNDS TO CARRY OUT THE NECESSARY PROGRAM ACTIVITIES . WHEREAS, The Redevelopment Agency is interested in starting a new Purchase and Rehabilitation Program pursuiant HUD/HOME guidelines at title 24 CFR, Part 92; and. WHEREAS, The new Purchase and Rehabilitation Program has been designed to expand the supply of decent; safe, sanitary and affordable housing within the City; and WHEREAS, $400,000 of The HOME Investment Partnership funds and $350,000 of the Redevelopment 20% Set-Aside Low/Moderate Housing Funds have been identified as eligible funding sources for the program; .and WHEREAS, In order to proceed ,funds from the Unappropriated HOME funds need to be appropriated to carry out the financial terms. of the Purchase and Rehabilitation Program . NOW,THEREFORE, The Redevelopment Agency does hereby resolve as follows: .Section 1. That the Redevelopment Agency approve the Purchase and Rehabilitation Program for . the City of Lynwood. Section 2. That the Executive Director is authorized to make the following fund appropriation and transfer FROM TO Unappropriated HOME Funds ~ Fund 34-4135-4220 HOME Program $400-,000 $400,000 AND FROM Unappropriated Redevelopment Set-Aside Low/Moderate Housing Fund $350,000 Andrea L. Hooper, Secretary APPROVED AS TO FORM TO Fund 34-4135-4220 HOME Program $350,000 Ricardo Sanchez, Chairman Ralph Davis, Interim Executive Director APPROVED AS TO CONTENT Shan K. Thever, Esq Director Agency Special Councel Gary Chicots, Community Development RESOLUTION NO. A RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF LYNWOOD APPROVING AFIRST-TIlVIE. HOMEBUYING PROGRAM PURSUTANT TO TITLE 24CFR, PART 92, AND TO CONIlVIITT $255,000 OF HOME INVESTMENT PARTNERSHIP FUNDS AND $255,000 OF REDEVELOPMENT 20% SET-ASIDE . LOW/MODERATE INCOME HOUSING FUNDS TO CARRY OUT THE NECESSARY PROGRAM ACTIVITIES WHEREAS, The Redevelopment Agency is interested in starting a new First-Time. Homebuying Program pursuiant HUD/HOME guidetines at title 24 CFR, Part 92; and WHEREAS, The new First-Time Homebuying Program. has been designed to expand the supply of decent, safe, sanitary and affordable housing within the City; and ,WHEREAS, $255,000 of The HOME Investment Partnership funds and $255,000 of the Redevelopment 20% Set-Aside Low/Moderate Housing Funds have been identified as eligible funding sources for the program; and i WHEREAS, In order to proceed ,funds from the Unappropriated HOME funds needt~ be appropriated to carry out the, financial terms of the First-Time Homebuying Program. . ~ NOW,THEREFORE, The Redevelopment Agency does hereby resolve as follows Section 1. That the Redevelopment Agency approve the First-Time Homebuying Program for the City of Lynwood. Section 2'. That the Executive Director is authorized to make the following fund appropriation and transfer FROM TO Unappropriated HOME Funds Fund 34-4135-4220 HOME Program - $255,000 $255,000 AND. FROM TO Unappropriated Redevelopment-Set-Aside Fund 34-4135-4220 HOME Program Low/Moderate Housing Fund $255,000 $255,000 Ricardo Sanchez, Chairman Andrea. L. Hooper, Secretary APPROVED AS TO FORM Ralph Davis, Interim Executive Director APPROVED AS TO CONTENT Shan K. Thever, Esq Director Agency Special Councel Gary Chicots, Community Development ~SIDENTIAL & MULTI FAM~i' FLOW CHART "A" NO Application Determination of Eligibility Property Inspection Case & Closed Work-Write Up Contractor Bids Monitoring of Work Payment upon Request Loan/Grant Approval Grant Participation Construction Agreement Notify Tenants Pre-Construction Conference Begin Construction End of Construction Days to Complete Task 1-15 days YES 22 days 36 days 43 days 44 days 54 days ~5 days 56 days 116 days Budeet $715,000 8 Deferred Payment Loans @, 30K Notice of 126 days 15 Grants @ SK Completion 8 Multi-Family DPL @ 45K Total Estimated Days of Completion 4 months CHASE &-REHABILITAT~V FLOW CHART "B" Days to Complete Task Obtain List (1) 1 day . Via Internet View Froperty Estimate Cost Obtain Comparable Sales • ~ Submit (2) to days Offer ' HUD s Open (3) 30 days Agent Escrow Close ' Escrow Rehab (4) 60 days Cit<~ Hires. Unit Contractor (60 days) ~ . Multi-List Broker Non Profit Clientl Locate Buyer (5) 70 days FTHBers Open Resale Bu ers Choice 80 days Escrow Close 90 davs Escrow Tbta_ 1 F~tiirated Lays of Ctnpleticn 3 myths - 1. Issues Bu et Total Bud¢et $750,000 2. Securit}~ Portable Buy for. $130 4 Houses ~ an average 3. .~ or 2 ~~ a time 30% discount 39 purchase of $115,000 4. Buv_ in "Hot" areas ~ $ 92 $53,750 available for rehab Rehab + 30 per each house 122 Holding Cost 1. Utilities 2. Insurance 3. Maintenance 4. Miscellaneous 123K ' Model Design $200 FIRST TIME HOME BUYER FLOW CHART "C" Application Days to Complete Task Determination of NO Eligibility YES 21 days Borrower Receives 3 days Case Letter to Participate Closed Locate Property 3o days Qualify for Mortgage Financing to days Open Purchase Escrow 5 days City Conducts HQS to days Compliance Inspection Buyer Submits Loan Package 1o days City Provides Funds to Escrow 5 days Close of Escrow 5 days 'Bud et $510 000 23 Deferred Loans @, $20.000 . Total Estimated Days of Completion 3 months Housing Rehabilitation Program Budget Total Program Budget for F.Y. 1998-99 Funding Source/Amount Operating Budget Personnel Office Supplies Operating Supplies Prof. & Cont. Services Advertising & Print Dollars available for Single Family Deferred Loans. Dollars available for Single Family Grants Dollars available for Rental Rehab. $715,000 HOME - $450,000 Set-Aside - $266,000 Max. 10% of budget $25,000 $ 300 $ 350 $15,000 Total $41,000 $240,000 . 8 Loans at a max. loan amount of $30,000 per applicant $ 75,000 . 15 Grants at a max. grant amount of $5,000 per application $360,000 . 8 Loans at a max. loan amount of $45,000 per applicant Acquisition of Foreclosed Single Family Properties Program- Budget Total Budget for F.Y. 1998-99 $750,000 Funding Source/Amount HOME - $400,000 Set-Aside - $350,000 Operating Budget Max. 10% of budget Personnel $50.000 Office supplies $ 300 Operating Supplies $ 350 Prof. & Cont. Services $24,000 Advertising & Print $ 350 Total $75.,000 Dollars available for property acquisition $460,000 4 houses at $115,000 per house Dollars available for rehabilitation of acquired properties $215,000 Total cost per house $53,750 ~ ~ TABLE OF CONTENTS I Introduction ................................................... 1 A. General B. Description of Assistance C. Program Regulations 11. Definitions ................................................... 3 II(. Type of Financial Assistance ....................................... 7 A. Grants B. Deferred Payments Loans (DPL) C. Bank-financed low interest loan IV. Eligibility Requirements .... ............................ 10 V. Eligible Improvements and Costs ........................... 1 1 VI. Program Procedures ................................... 13 Vll. Contractor Requirements ................................ 16 VI11. Other Federal Regulations ..................................... l 8 A. Equal Opportunity B. Civil Rights Act C. Temporary Relocation D. Section 3 E. Lead-based Paint F. Environmental Review G. Hatch Act H. Truth-in-Lending 1. Records to be maintained J. Energy Conservation K. Rehabilitation Standards I. Public Interest M. Arbitration N. Interpretation of Regulations IX. Other Program Activities ................................ 24 1. Acquisition of foreclosed single-family properties 2. Rental Rehabilitation ~ ~ INTRODUCTION A. General The Housing Rehabilitation Program has been adopted by the City Council of the City of Lynwood to meet the City's Community Development goals of providing its residents with decent, safe and sanitary housing and a suitable living environment as outlined in the City's approved S-Year Consolidated Plan. The Housing Rehabilitation Program provides technical and financial assistance to qualifying owners of residential properties in designated target areas in the City of Lynwood.. The primary funding for the Program is through the HOME Investment Partnership Program (HOME Program), a federal program under which the City is allocated funds directly from the U. S. Department of Housing and Urban Development (HUD) for affordable housing purposes. The primary purpose of the HOME Program is to expand the supply of decent, safe and sanitary and affordable housing. Since November 1975, the Housing Rehabilitation Program has provided assistance to numerous property owners. In an effort to increase the Program's efficiency and responsiveness, City Council also approved an operating agreement with the Bank of America, whereby the Bank agrees to make low-interest loans to eligible applicants participating in the City's Housing Rehabilitation Program. B. Description-of-Assistance 1. Technical Assistance Program staff provide assistance to qualifying applicants in: - loan counseling -code compliance - property rehabilitation - preparation of cost estimates 1 1 l • . -preparation of bids and contracts a -selection. of contractors - construction monitoring 2. Financial Assistance - The Rehabilitation Program offers qualifying property owners financial assistance in the form of grants, deferred payment loans (DPL) and low- interestloans. At the City Council's direction, program components maybe added, revised', and/or deleted, depending on particular requirements. C. Program Regulations . This Manual sets forth the policies and procedures governing the administration of the City of Lynwood' s Housing Rehabilitation Program and supersede all regulations previously approved. The following chapters outline the policies and procedures under which the City of Lynwood's Housing Rehabilitation Program will operate. The policies and procedures contained herein can. only be revised, amended and or deleted by the City Council of the City of Lynwood. This Manual becomes effective immediately upon approval by the City Council of the City of Lynwood. 2 • ~ I1. DEFINITIONS The following terms and definitions shall apply to this Manual: 'Target Area" means an area characterized by substantial deterioration of residential structures. "Elderly" means a family in which the head of household is 62 years of age or older or a single person, who is 62 years of age or older. "Household" means one or more persons who are very low or low income household owner- occupants. "Monthly Debt Service" means the amount of money a~ Borrower must pay each month on a loan, for principal and interest. "Owner" means any. individual that owns residential property in fee simple pursuant to the provisions of these procedures. "Owner-Occupant" means an owner of one to four unit residential property who uses one of the units. as a principal residence. "Rehabilitation" means repairs and improvements to a substandard structure necessary to make it meet local codes and rehabilitation standards. "Rehabilitation Program" means an ongoing program involving construction assistance, financial assistance or technical assistance, in the rehabilitation of residential and commercial property. "Rehabilitation Standards".means applicable State or local building or housing standards adopted by the City of Lynwood pursuant to the State Housing Law, Part l .5 (commencing with. Section 17910) of Division 13 of the Health and Safety Code and specifically Section 17959.8. Rehabilitation standards including room additions necessary to alleviate overcrowding for eligible households. "Room Addition" means bedrooms or bathrooms which are added to a structure to .alleviate documented overcrowding. "Substandard Structure" means any residential building or any portion of a residential building including, but not limited to, any dwelling unit,. guest room, or suite of rooms, or the premises on which the same is located, in which there exists any of the conditions listed in the Uniform Housing .Code, latest edition, to the extent that the conditions endanger the life, limb, health, property, safety or welfare of its residents. 3 • ~ "Transfer of Property" means to sell, convey, transfer, or alienate title, voluntarily or otherwise, to the property, except in the case of the transfer of the property to an owner-occupant's spouse as a consequence of death or dissolution of marriage. "Bank" means the selected lender participating in the City's Housing Rehabilitation Program. "HUD" means the Federal Department of Housing and Urban Development. "Assisted Unit" means those units which directly benefit from funds from the Housing Rehabilitation Program. "Borrower" means a property owner receiving rehabilitation loans from the Program .pursuant to provisions of this Manual. "Department" means the City of Lynwood Department of Community Development. "Director" means the Director of the City of Lynwood Department of Community Development. 'Program" means -the Housing Rehabilitation Program of the City of Lynwood. "Minor" means a member of the family household (excluding foster children) other than the family. head of household who is under 18 years of age or is ~a full time student and lives at home. "Gross Income" shall mean the anticipated income of a person or family. for the twelve-month period following the date of determination of income. "Annual Income" means all payments from all sources received by all household members who are not a minor to be included in the annual income of a family. Adjust gross income, as defined under the Internal Revenue Service (IRS) form 1040 series 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 incomes from estates or trusts; (4) The full amount of periodic payments received from social security, annuities, insurance .policies, retirement funds, pensions, disability or death benefits andother similar types of periodic receipts; 4 • • (5) payments in lieu of earnings, such as unemployment and disability compensation, worker's compensation and severance pay. (b) The following items shall not be considered as income: " (l) 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 household that is 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 volunteer .programs "Housing Cost" of a person or family rehabilitating a housing unit shall include all of the following monthly cost associated with that housing unit: 5 • • . (a) Principal and interest on a mortgage loan including any rehabilitation loans, and any loan insurance fees associated therewith. (b) Property taxes and assessments. ©Fire and casualty insurance covering replacement value of property improvements. (d) Property maintenance and repairs. (e) A reasonable allowance for utilities. including garbage collection, sewer, water, electricity, gas, and other heating, cooling,. and refrigeration fuels. Utilities does not include telephone service. Such an allowance shall take into consideration the cost of an adequate level of service. . (f) Homeowner association fees. (g) Space rent, i# the housing unit is situated on rented land. "Affordable housing cost" for aowner-occupant shall be not less than 2896 and not more than 3396 of the gross monthly housing income. "Very Low Income Households" means persons and families whose gross incomes do not exceed 50 percent of the area median income, adjusted for family size determined by the United States Department of Housing and Urban Development (HUD) and are subject to change. HUD issues periodic updates of income guidelines (see Appendix for.most recent update). "Low Income Households" means persons and families whose gross incomes do not exceed 80 percent of the area median income, adjusted for family size and other adjustment factors by the United States Department of Housing and Urban Development (HUD) and are subject to change. HUD issues periodic updates of income guidelines (see Appendix for most recent update). "Program Coordinator" means the staff person in the Community Development Department who is responsible for the day-to-day operation of the Program. "Rehabilitation Contract" or "Contract" means a duly executed agreement between the property owners and the selected contractors setting forth the scope of work to be performed by the latter, containing the consideration and method of payment and any other terms and condition necessary to accomplish the stipulated property rehabilitation work. 6 • III. TYPE OF FINANCIAL. ASSISTANCE -TERMS, CONDITIONS AND RESTRICTIONS A. Grants A grant in the amount of $5,000.00 is available to very-low and low income owner-occupants. A. Preliminary Determination of Eligibility Rehabilitation staff makes a determination that applicant is income eligible. Staff will also make a determination that improvements are necessary to the health and safety of the applicant. B. Deferred Payments Loans The Deferred Payment Loan (DPL) is a three percent 3°y6 simple interest rate loan. The maximum DPL amount shall be $ 30,000 per applicant. The loan, principal and accumulated interest become due and payable in a lump sum upon sale or transfer of the property by any means. DPL funds are loaned directly by the City to eligible property owners .All DPL's shall be secured with a recorded Deed of Trust and may be subordinated to prior loans and liens. .The Borrower may repay a partial or full amount at any time with no prepayment penalty. A. Preliminary Determination of Eligibility -~ Rehabilitation staff makes a determination that applicant is eligible and is unable to maintain a loan repayment plan. Staff will also make a determination that improvements are necessary to the health and safety of the applicant. B. Approval Authority DPL will be approved or disapproved by the Program staff. The City will notify applicant of results. An applicant whose application for a DPL has been disapproved may appeal to the City Council for a final decision.. C. Subordination The Program Staff shall evaluate all requests for subordination of the City's Deferred Payment . Loans (DPL) and either recommend approval or reject the request. Rejection of the request may be appealed to City Council by applicant., Only those requests which provide evidence of financial hardship with impending loss of the subject property through default and foreclosure, intent to perform additional home improvement work or a reduction of monthly housing payments may be considered. Additionally, after proper consideration of the reasons described above, only those requests which provide evidence of sufficient equity may be granted the subordination. • 1. Information on Applicants Program staff shall prepare a summary sheet stating applicant's name and address, income, amount of DPL, reason for request and other information needed to establish the propriety of the request. Applicant must demonstrate both ,the need for the subordination and his/her inability to pay back the City's 'loan. 2. Protection of the Pubic Investment Protection of the public investment shall be of paramount importance to Program staff when evaluating requests for subordination. In those cases in which the applicant's ability to pay back the City loan has been established, both Program staff shall recommend the rejection of the request for subordination: Program staff shall strive to impress upon the applicant(s) both, (].)the impropriety of obtaining windfall profits from public funds and, (2) the. need to recapture the public investment for recycling into the property rehabilitation loan pool so as to maximize the benefits of these funds to the community. 3. Request for an Assumption of Deferred Payment Loans. (DPL) Only those persons who meet the Rehabilitation Program guidelines pursuant to the provisions above, shall be granted the request. C. Bank-funded low interest loans The City's Housing Rehabilitation Program will make available below market interest rate property rehabilitation loans to qualified borrowers. The interest rates offered by the Program vary according to market conditions. Bank of America is the current lending institution that has been selected to provide low interest loans under contract with the City. Low interest rehabilitation loans are made available for the improvement of owner-occupied dwelling units. A rehabilitation loan may be approved because an executed Agreement exists between the Bank of America and the City of Lynwood to provide rehabilitation loans to property owners. Low interest loans are secured with a recorded Deed of Trust which may be subordinated to the first Trust Deed only. However, the Bank, at its discretion, may waive this . requirement. s • • The maximum loan amount shall be limited to the amount necessary to cover the cost of meeting rehabilitation standards which cannot be financed by any combination of funds otherwise available. Monthly repayments shall be made over a term that is determined by the Bank. Loan repayments will be added to other housing costs to assure overall .affordability. Although a loan application has been accepted for. processing by the City, approval by the City must await notification by the Bank of America, before the applicant is notified by the City that his/her loan application has been approved. The City will note in its files the means and date of notification to the applicant of loan .approval. No work is to be performed prior to this notice unless such notice is waived by the Director. The.. number of low interest rehabilitation loan, which may be made to any property owner under~the Rehabilitation Program is one (1 ). Requests for a waiver of this restriction shall be made by the loan applicant, in writing, to the Director. The City and the Bank of America shall maintain an application file for each application that it processes. The file maintained at the lending institution shall be separate from, and in addition to, any other file maintained, by the City. Copies of the file shall be made available to the U.S. Department of Housing and Urban Development upon an appropriate request. 9 • IV. ELIGIBILITY-REQUIREMENTS This section sets forth eligibility requirements as to the property and the applicant to obtain a Grant, DPL or Bank of America low interest rehabilitation loan. A. Property Eligibility Requirements Rehabilitation grants and loans will be made to eligible properties located within City of Lynwood , target areas. That is, property must need. rehabilitation in order to comply with the Property Rehabilitation Standards adopted by the City Council (Appendix A.) . B. General Applicant Eligibility Requirements To be eligible for a grant, the applicant must be income eligible {very low, low). To be Eligible for a bPL, the applicant must be income eligible (very low, low). To be eligible for a low interest loan from Bank of America, the applicant must demonstrate adequate " ability to repay the loan and be income eligible (very low, low). A rehabilitation loan will not be approved by the Bank if applicant's record shows a disrespect for former obligations, or there is an indication of an inability to make the payments that will be required. V. ELIGIBLE IMPROVEMENTS AND COSTS This section sets forth, but does not limit examples of eligible and mandatory improvements under the Housing Rehabilitation Program. as well as ineligible improvements. A. Mand atory- Improvements Hazardous conditions which are a direct threat to the health, safety and general welfare of occupants B. Eligible improvements and Costs 1. Additions and alterations to relieve overcrowding and/or increase the livability or usefulness of existing structures, such as rooms, porches, stairways, closets, . bathrooms, and entrances . 2. Exterior work to help preserve or protect structures such as painting, roofing and siding. 3. Interior work to make a structure more livable, such as painting, papering, plastering, new flooring and the work. `~ 4. Repairs, restoration or replacement of important parts of structures such as heating systems, plumbing repairs, and built-in kitchen appliances in residential structures.. . 5. Demolition, clearance and site preparation where a unit is determined not suitable for rehabilitation. 6. ~ Costs .for improvements related to making the housing unit(s) accessible to and usable by the handicapped. 7. The cost of design services for the preparation of plans, drawings, and specifications -for the rehabilitation of the property. 8. The cost of building permits and related fees. required for the rehabilitation, if not included in the construction contract. 9. Costs of title reports, credit reports, appraisal reports .and fees for recording documents related to the financing. 0. The cost of repair and installation of alternative energy conservation systems - and weatherization when done in conjunction with other rehabilitation work. 1~ C. Ineligible-Improvements-and Costs :. The following improvements are not eligible: barbeque pits, bathhouses, burglar alarms, dumbwaiters, fire extinguishers, flower boxes, greenhouses, kennels, kitchen appliances which are designed and manufactured to.be free standing and are not built-in and permanently affixed as an integral part of the kitchen, outdoor fireplace or hearths, swimming pools, television antennae, tennis courts, waterproofing a structure by pumping or injecting any substance in the earth adjacent to- or beneath the basement or foundation or floors, or any other improvement not customarily found in the surrounding dwellings. D. Grants and loans made by the City or Bank may not include the following unauthorized expenses: 1. Real property acquisitions. 2. New construction, except for room additions. 3. Materials, fixtures or equipment of a type of quality which exceeds that customarily is used in for properties of the same general type as the property to be rehabilitated. 4. Appliances not required by rehabilitation standards. 5. The purchase, installation, or repair of furnishings or trade fixtures. 12 • Vl. PROGRAM PROCEDURES This section sets forth the steps which are to be .followed in the processing of rehabilitation assistance. L Initial-Contact Marketing effort strategy includes but is not limited to flyers, phone communication, door to door contacts by Rehabilitation staff. A preliminary application will be delivered to the applicant. Upon return of the application staff will establish preliminary eligibility for the Program. If applicant is found eligible, an appointment will be scheduled-with the property owner for an inspection by the Rehabilitation Specialist. 2. Application Processing a. Verify Program eligibility of the applicant. b. Verify that applicant is owner of property to be improved.. c. Verify applicant's income and employment. In the ;event that .applicant is self-employed, the income tax, returns for the previous two years will be obtained. d. Complete credit .investigation. e. Advise City .and homeowner in writing of approvaVdisapproval. The property owner wilt be notified of final acceptance in the Program 3. Property Inspection At this preliminary inspection items will be identified and a work write-up and cost estimate prepared. The Rehabilitation Specialist shall identify all code violations observed. Participants in the Housing Rehabilitation Program shall provide consent to the City, its agents or employees to enter upon and inspect the lands, buildings and equipment of the applicant at any time before, .during or after rehabilitation of their property. 4 .. 13 . ~ • 4. Termite- Inspection A termite inspection may be required by the City. The property owner will submit the inspection to the Rehabilitation Specialist for inclusion in the work write-up and cost . estimate. 5. Work=Write-Up and Cost Estimate A work write-up/cost estimate will be compiled based on the initial inspection and results of the termite inspection report. The Homeowner will be given a copy of work write-up. The work write-up may include the necessary architectural drawings and specifications as pertinent. 6. Bid Process Bid packages will be prepared and provided to the Homeowner. The Homeowner will obtain bids from qualified contractors. "Qualified" means those„contractors who are licensed by the State of. California, who-have applied to participate in the City's Rehabilitation Program anal who have received written approval of their participation in the Program. However, if applicant desires to obtain bids_from contractor(s) not on the City's list, applicant must submit names, license number(s) andaddress(es) of contractor(s) to the Rehabilitation Program. Rehabilitation Program staff shall verify contractor(s) qualifications. The selected bid must be returned by the homeowner as soon as possible. No contractor shall be awarded a contract if said contractor has more than four (4) incomplete rehabilitation. jobs. Prior to award of the contract, Program staff shall verify with HUD that contractor is not on the list of debarred contractors. 7. Contract Execution - _ ~ As a requitement for funding, a contract agreement must be executed. The Contract.shall contain (1) the .bid and proposal by the contractor, and (2) the general conditions and building specifications for the work to be performed. 8. Execution of Documentation . The City and/or lender will prepare the appropriate documents. 9, Pre-construction Meeting. The City will conduct apse-construction meeting to execute all documents. 14 l 0. Notice to Proceed Property owner will be assisted by the City in issuing a notice to proceed for construction rehabilitation work. 1 l .Disbursement The City will release funds in a form prescribed by the institution or agency. Disbursements will be made only after completion of inspection and verification. of billings and lien releases by Rehabilitation Specialist. Proceeds will be disbursed as follows: Contractor may not receive more than- three progress .payments. The progress payments shall. not exceed 90°x6 of the cost of such work. items determined by the bid breakdown. Progress payments due contractor shall be paid after City approval of receipt and verification of contractor's invoice(s) and satisfactory Release of Liens, or claims for Liens, by contractor, subcontractor, laborers and material suppliers for work completed and materials installed. _ A 10% retention will. be disbursed to contractor at expiration of lien filing period,. or thirty- , five (35) days after filing of the Notice of Completion. This retention may increase or .decrease. Payment .may be made. in one lump sum upon completion. Completion consists of passing final inspection and.filing required release forms. 15 / S • ~ • VIL CONTRACTOR REQUIREMENTS Thin chapter sets forth the provisions governing participation by contractors in the Housing Rehabilitation Program. CONTRACTORS ELIGIBILITY Contractors wishing to participate in the Housing Rehabilitation Program shall. be required to: A. License Be. properly licensed in accordance with the provisions of Chapter 9 of the State of California Business and Professional Code, as amended; B. Workers Compensation Insurance Carry Workers Compensation Insurance in accordance with the provisions of the - California Labor Code, with adequate protection from claims under the Workers Compensation Act which may arise from operations under the Contract; C. Manufacturers and Public Liability Insurance Carry Manufacturers' and Contractors' Public Liability Insurance with limits to protect the Owner(s), Contractor, and his subcontractors against claims for injury to or death of one,. or more than one person, because of accidents which may occur or .result from operations under the Contract; such. insurance shall cover the use of all equipment, including but not limited to excavating machinery,. trenching machines, .cranes, hoists, rollers, concrete mixers, and motor vehicles, in the construction of the . work embraced. D. Property Damage and Liability Insurance Carry, during the life of the Contract, Property Damage and Liability Insurance in an ' amount to protect him and his subcontractors from claims for property damage which might arise from operations under this Contract. E. Personnel Employment Record . . Have and maintain a good record in personnel employment practices. Contractors debarred by HUD are not eligible for participation in the Program. 16 F: Performance Record Have and maintain a good business and work performance record. Program staff shall. verify eligibility and if evidence of improper and/or poor business conduct and' - work performance is established, the Program may deny Contractor participation in the Program or may require Contractor to submit evidence of bonding as required by `the Program prior to execution of any Contract. '. LIST OF APPROVED CONTRACTORS The Housing. Rehabilitation Program shall maintain a List of Approved Contractors for the purpose of assisting property owners to obtain bids for the proposed rehabilitation work. The Program does not recommend or .endorse any of the. Contractors on said list. The owner(s) is not required to select .any of the Contractors on the List. However, any Contractor selected by the Owner: must comply with the provisions listed above. Any Contractor(s)) may be removed from the List when there is documented evidence of non compliance with the provisions of the Program, and/or evidence of unprofessional conduct in the .performance. of his/her duties. r ' - 17 ` • - . VII'1. OTHER FEDERAL REGULATIONS This chapter sets forth the provisions governing. Program compliance with other Federal regulations. These provisions shall be adhered to and/or incorporated in all applicable documents used in the provision of any property rehabilitation assistance. A. EQUAL OPPORTUNITY PROVISIONS During the performance of the Program, the City, the Program Participants and the selected contractors agrees as follows: 1. The Contractor shall not discriminate against any employee or applicant for employment because of race, color, religion, sex, or national origin. The Contractor shall take affirmative action to ensure that applicants for employment are employed, and that employees are treated during employment, without regard to their race, color, religion, sex, or national origin. Such actions shall include, but not be limited to, the following: employment, upgrading, demotion, or transfer; recruitment or recruitment advertising, lay off or termination; rate of pay or other forms of compensation; and selection for training including apprenticeship. B. CIVIL RIGHTS ACT 1964 Under Title VI of the Civil Rights Act of 1964, no person shall, on the grounds of race, color, or national origin, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance. C: TEMPORARY .RELOCATION -ASSISTANCE . This section sets forth a description of temporary relocation benefits that may be made available to persons and families who are temporarily displaced from their homes as a result of the City's -Rehabilitation Program: ~. ~ A. Conditions-Requiring Temporary Relocation. If any of the following causes or conditions occur as a result of the Housing Rehabilitation Program, it maybe 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 to make repairs to wiring. 18 3. Repairs would create dust and other conditions which would aggravate allergic condition of occupant(s). 4. Structures are to be fumigated for termite control .and infestation. 5. Hazardous living conditions would result from. structural changes during " construction. 6. Sanitation facilities, e.g., tub, wash basin, toilet are to be removed and/or become 'non-operable. 7. Contractor required relocation of people to perform repairs on time at agreed upon price. B. Eligibility Requirements Persons or families of very low and low income who have occupied the property for ` more than ninety (90) days and who must find temporary commercial accommodations, are eligible for relocation benefits. Persons or families must actually secure and occupy alternative dwelling unit in order to receive payment. . C. Amount of Assistance Benefits will be made available fora .period determined by the Director but not to exceed the contract term. City will pay the cost of the temporary commercial accommodations. The daily maximum amount shall be based on the lowest reasonable rate(s). obtained from at least three (3) different bona fide commercial .lodging establishments. it shall be the applicant's responsibility to obtain quotations {bids) from above mentioned establishments and submit said quotations to the Program office. Depending upon the number of persons permitted to occupy one . room, the schedule may be adjusted to reflect actual cost. D. Procedures for Securing Relocation Benefits Contractor must submit letter to City requesting the vacating of unit and specifying " ~ amount of time that .unit must remain vacant. Request for vacating of the premises must be approved in writing by Rehabilitation staff and authorized by the Director or his/her designee. . ~ ~ Rehabilitation staff will present claim form to Finance Department with a request for advance payment. Advance payment will be made payable, jointly, to displaces and to .commercial accommodation. Advance payment will be delivered to displaces by Rehabilitationstaff. 19 D. SECTION 3 COMPLIANCE ` _ The-work to be performed on,a project assisted with financial funds from the Department of Housing and Urban Development is subject to the'requirements of Section 3 of the Housing and Urban Development Act of t 968, which requires that, to the greatest extent feasible, opportunities for training and employment be given lower income residents of the City and contracts for work in connection. with the project be awarded. to business concerns which are located in, or owned in substantial part by persons residing in the area . E. LEAD-BASE PAINT Housing assisted with HOME funds is subject to the Lead-Based Paint Poisoning Prevention Act (42 U.S.C 4821 et se .) And 24 CFR Part 35. The City shall conduct an inspection of defective paint surfaces in all units constructed prior to 1978 which are occupied by families with children under sever years of .age. F. ENVIRONMENTAL REVIEW The environmental effects of the rehabilitation must be assessed in accordance with the provisions of the National Environmental Policy Act of t 969 as follows: l ...National Flood Insurance Program. (S 570. 609) The provisions of the Flood Disaster Protection Act of l 973 and the regulations thereunder .apply to assistance. Under that Act no agency shall approve. any financial assistance for ' construction In an area having special flood hazards unless the applicant participates in the • National Flood Insurance Program. 2. Compliance with Air and Water Acts. The selected contractor and all subcontractors shall comply with the requirements of. the Clean Air Act, as amended 4 USC 1857, et seq., the Federal Water Pollution Control Act, as amended, and the regulations of the Environmental Protection~Agency as amended. 3. Historic Preservation 20 • - G. HATCH ACT Neither the HOME Program nor the funds provided therefore, nor the personnel employed in the administration of the Program shall be in any way onto any extent engaged in the conduct of political activities in contravention of Chapter l 5 of Title 5, United States Code. H. TRUTH-IN-LENDING REQUIREMENTS A. General This section describes the Truth In Lending Act and its procedural and disclosure requirements which must be followed in the settlement of Bank and deferred payment rehabilitation loans. - Title. 1 of the Consumer Credit Protection Act was enacted by Congress on May 29, 1968 and became effective on July ] , 1969. The Act requires that borrowers in "consumer credit transactions" be vested with certain rights and protections in connection with the transaction and receive specified written information from the lender. The disclosures must. be made before credit is extended and before the borrower becomes obligated in connection with the transaction. Among the required disclosures are: (a) The amount of credit a borrower will have for his actual use (the amount financed); and . (b) The finance charge (consisting primarily of interest but also other fees and charges) expressed both as a dollar amount and as an Annual Percentage. Rate. . In addition, the act enables a Borrower, within three (3) days following the loan transaction, to rescind the transaction, if the loan. is secured by a Tien on the borrower's residence. j The Truth In Lending Disclosure Statement is to be used at a loan settlement in meeting the requirements of the Truth-In-Lending Act. A statement shall. be given to all Borrowers of rehabilitation loans except those borrowers which are corporations, partnerships, or otherwise organized as an independent entity or business firm under local law. The Disclosure Statement shall be given the borrower at loan settlement but prior to the time he/she executes the mortgage and promissory note obligating his repayment of the loan. .. ~ When the Disclosure Statement is given to the Borrower, he /she shall be requested to sign and~date completed Disclosure Statement in the presence of an employee or other authorized 21 ...representative of the Bank and/or Program staff who shall also sign as witness. The signed . and witnessed copy of the Disclosure Statement shall be retained by the Bank in the loan application file. 1. ACCESS TO~ PROPERTY-RECORDS MAINTENANCE .Borrower agrees to grant the City of Lynwood and the United States Government or their designee permission, to enter and inspect property and to inspect records of Applicant relating to the,rehabilitation assistance received from the City of Lynwood. City agrees to retain copies of all records related to the use of Rehabilitation Program funds for a period of seven (7) years from the effective date of the execution of a Rehabilitation Agreement between the Applicant and the City of Lynwood, and to forward copies of originals, as requested. . J. COST EFFECTIVE-ENERGY-CONSERVATION-STANDARDS Cost=effective energy conservation-improvement shall-be required as applicable. K. PROPERTY REHABILITATION STANDARDS All the residential rehabilitation work shall comply with the adopted Property Rehabilitation Standards (See Appendix A). Any new construction work performed under the Housing Rehabilitation Program shall comply with the City's Building and Safety Codes and Zoning Ordinances. All illegal and/or substandard improvements shall be required to be brought up into compliance with appropriate codes and/or ordinance as determined by the Rehabilitation Specialist. L. CONFLICT WITH THE PUBLIC INTEREST The property for which rehabilitation assistance is requested may not be situated in a location where it will be in conflict with either existing or proposed redevelopment projects involving the construction or development of public schools, parks, streets, utilities and other public facilities except that, when determined by the Director, a health and/or safety hazard exists which endangers the public health and welfare. M. REQUEST FOR ARBITRATION The Program Staff may serve as Arbitrator between the Rehabilitation Program's participating property owners and contractors. 22 • N. REQUEST FOR INTERPRETATION OF REGULATIONS . The Program Staff shall serve as Interpreter of the Adopted Housing Rehabilitation Program Regulations when Program participants. challenge an interpretation of the Regulations. • IX. OTHER PROGRAM ACTIVITIES 1. ACQUISITION OF FORECLOSED SINGLE FAMILY PROPERTIES Acquisition Program objective: .The Program. has been established to enable the City staff to .purchase and rehabilitate certain FHA and other foreclosed properties that are located in the incorporated area of the City for resale to eligible low-income households. The amount of HOME Program funds that the City may invest on a per-unit basis may not exceed~the per-unit limits established by HUD as follows: 0-bedroom.- $69',738. 1-bedroom - $79,941. 2-bedroom.- $97,208. . ~ 3-bedroom- $125,753. 4-bedroom -,$138,038. 1. City staff shall obtain a listing of properties from the HUD Home Page= HUD will offer a . ~ ` discounf of l 0 - 30% off of the listed price for acquisition purposes. 2. 'Within the HUD-prescribed time frame, the City staff shall indicate preliminary interest. ` An expression of interest will hold the property off of the general market'for a 10 day inspection period. 3. During the ten day inspection period, the City staff shall perform a physical inspection of . the property as well as a review of the comparable sales to establish the after rehabilitation value of the property. At the end of the ten day inspection period, a Offer to Purchase must be submitted to HUD via the HUD-prescribed process. HUD will release the property for competitive bidding if this letter is-not .received in a timely manner. 4. _ HUD will then coordinate the close of escrow with their selected escrow agent..City staff - . - shall obtain and provide proof of hazard insurance at the time of the close of escrow. • 2: RENTAL REHABILITATION 1. AREAS ELIGIBLE TO PARTICIPATE IN THE PROGRAM The Program is available for rental units located throughout the City. 2. HOME-ASSISTED UNITS . A. Only units receiving HOME monies are considered "HOME-assisted units". HOME per ' ' unit expenditures limits, rent and occupancy rules o~ apply to HOME-assisted units. The number of HOME-assisted units in a project must be specified at the time of .project commitment. ' B. In a mixed-use project, the owner/developer. must select either the fixed (designated) " affordable unit method or the floating affordable unit method at the time of commitment. Floating units may only be substituted with units that are comparable in terms of overall size, features and number of bedrooms. If the applicant chooses the floating affordable unit method, the City will determine the total number of floating units at the time of commitment.. D. The minimum amount of HOME. funds in a project is $1,000 per HOME assisted unit. 3. - ELIGIBLE APPLICANTS Applicants will be accepted from the following: (I) Private owners/developers of rental properties. (2) Non-profit organizations that own or wish to own affordable rental property. An applicant is ineligible if: (1 }The applicant is not credit-worthy, current with other lenders, or has substantial ...adverse credit problems. If there is a history of bankruptcy or history of tax payment- problems, .proof of resolution of these credit problems`must be provided. (2) The applicant is in violation of the HOME Program conflict of interest provisions as described in 24 CFR 92.356. 25 ' ~ • (3) The applicant does not demonstrate the capacity to undertake and successfully complete the proposed project. 4. PROGRAM ASSISTANCE The Program is designed to assist projects by providing necessary funds to finance actual rehabilitation costs. Applicants may receive a deferred loan, due on sale or.transfer. Repayment does not remove the fixed affordability period (5, 10, 15 years). . ~ 5. .LOAN LIMITS AND TERMS The maximum allowable .loan. to value ratio for all indebtedness on the properties to be assisted is'909-6 of the post rehabilitation appraised value of the property, not to exceed .actual project costs. 6. SECURITY All-Program assistance will be secured by a recorded Deed of Trust. A HOME Agreement will also be recorded against the property to ensure continued affordability and occupancy by low-income households. 7. ELIGIBLE PROPERTIES HOME. Rental projects may consist of: A. One or more. buildings on a single site that are under common ownership,. management and financing. B.-More than one site as long as the sites are within four blocks of each other and are . under common ownership, management and financing and will receive HOME assistance as part of a single project undertaking. C. There are no limits on the number of units per project. Projects consisting of twelve or more HOME assisted units are subject to. Davis-Bacon wage compliance and other regulations pertaining to labor and standards. 8. ELIGIBLE USE OF PROGRAM FUNDS Housing that is assisted with HOME funds. must, at a minimum, .meet the all applicable City codes, rehabilitation standards, ordinances, and zoning ordinances. Substantial rehabilitation projects must also meet the cost-effective energy conservation and effectiveness standards. 26 • A. Eligible Hard Costs -Program funds are available for the rehabilitation costs to rental property that correct substandard conditions and are physically attached to the property and permanent in .nature, . B. Site Preparation (1) Costs to demolish existing structures (2) On-site improvements to the project site that are in keeping with improvements of ,surrounding, standard projects, like off-street parking if generally provided in similar buildings, landscaping, fencing and ground cover, for playgrounds and costs to make utility connections. (3) Off-sfte .utility connections (from the project property line to the adjacent street). C. Related Soft Costs. Other reasonable and necessary costs incurred and associated with the financing, or rehabilitation of housing assisted with HOME funds. These costs include, but are not limited to: (l)Project-related professional services including architectural, engineering or related services required to prepare plans, drawings, inspections, specifications, or work write- ups. (2) Costs of a project audit that the City may require with respect to the development of .the project. (3) Costs to provide information services such as .affirmative marketing and fair housing information to prospective homeowners and tenants. (4) Flood insurance premiums. (5) Costs of relocation payments and other relocation assistance for permanently and temporarily relocated individuals, families, businesses, non-profit organizations, and farm operations where assistance is determined by the City to be appropriate. (6) Reimburse-the costs of appraisals, title insurance, credit reports, and recording fees. (7) Costs associated with financing and processing including: a: Legal fees 27 b. Building permits/local impact fees c. Private lender financing fees d. Builder/developer fees (not to exceed' 796 of the HOME project costs) {8) For substantial rehabilitation as described above, the cost of funding an initial operating deficit reserve to meet a documented shortfall in project income during the first twelve months of project rent-up. Funds may only be used to pay project operating expenses .. and/or .debt service. - 9. INELIGIBLE USE OF PROGRAM FUNDS HOME Program funds cannot be used for: - A. Ineligible improvements include the following: (1) Repair, purchase or installation of kitchen appliances which are designed. and manufactured to be freestanding. (2) 'Recreational items such as barbecues, bathhouses, greenhouses, swimming pools,. saunas, television antennae, tennis courts. (3) Luxury items such as burglar alarms, burglar protection bars, dumbwaiters, kennels, murals flower boxes, awnings, patios, decks and storage sheds/workshops. B. Providing a project reserve account for replacements for unanticipated ~. increases in operating costs, or operating subsidies. ' C. Providing project-based rental assistance. D. Preventing displacement from projects assisted with Rental Rehabilitation grants. . E. Providing non-federal matching contributions required under any other federal program. ` F. Providing assistance to Public Housing Authority (PHA) Owned or Leased Projects; or Maintenance and Operation activities. 28 G. Providing assistance for the preservation of low income housing under the Low Income Housing Preservation and Resident Homeownership Act of 1990 (LtHPRHA). H. Carrying out activities authorized under the Public Housing Modernization Program.. ' t. Providing assistance to a project previously assisted with HOME funds during the period of affordability established by the City. Additional HOME funds may be committed to a project up to one year after project completion, but the amount of HOME funds in the project may not exceed ' ~ the maximum per-unit subsidy amount as established by HUD. . J. Provide an operational reserve for unanticipated cost increases. K. .Subsidize operating expenses. ._ L. Pay for emergency repairs or to establish.an emergency repair reserve. - } 0. RENT REQUIREMENTS In order to comply with HOME Program requirements, every HOME assisted unit is subject to rent. restrictions (HOME rents), as established periodically by HUD. A. HIGH HOME rents -All .HOME-assisted units must have rents not higher than the lessor of: (1) The Section 8 Fair Market Rents (FMRs) for existing housing,- minus tenant paid utilities, or (2) . Rents that are 30% of adjusted income for households at 65gfi of median, minus tenant paid utilities. B. LOW HOME rents - At least 2Oor6 of all HOME assisted units must have rents that are equal to or less than 30% of annual incomes for households at 50% of median income, minus tenant .paid utilities. As of February, 1998, the rent limitations as published by HUD for the City are: 29 '0 BEDROOM :ONE . -TWO THREE FOUR BEDROOM BEDROOMS 'BEDROOM 'BEDROOMS` - - ~'~.. S 0 $448. '$480. $577. $666. $743_ IGH $486. $583. $728. $832. $91.0. 11. RENT SCHEDULE AND UTILITY ALLOWANCES The City will determine initial HOME rents for the rental units less an adjustment for ' utilities and services if paid by the tenant. The Developer/ Owner must reexamine and _ submit to the City the income of each tenant household living in the rehabilitation units annually for the affordability period. Rents may be recalculated and approved by the City .annually. Any change in the applicable gross rent amounts, the income adjustments, or the ' monthly allowance for utilities must be approved. Any increase in rents is subject to the provisions of outstanding leases. The Developer/Owner must provide tenants of those ' - affected units no less than a 30-day prior written notice before implementing any increase in rents. Staff will. provide the property Owner with a guidebook detailing their reporting ..responsibilities. l 2. AFFORDABILITY PERIOD ° The affordability period will be determined on a case by case basis per the federal HOME Program regulations as follows: :. • $0 - $1.5,000. 5 'Years. ° • $15,000. - $40,000. ] 0 Years • Over $40,000. l 5 Years . 13. INCOME-ELIGIBILITY OF TENANT HOUSEHOLDS A. Annual income is the gross amount of income that is anticipated to be received by all adult members of the household during the twelve months following the effective date of - determination. Income shall' be verified utilizing the third party verification format of other, such procedures as necessary. B. The annual incomes of tenant households in HOME assisted units must be reexamined each. year on the anniversary of their original income evaluation and lease execution.- 30 s • • . C. Tenant households occupying HOME assisted units whose annual incomes exceed 8090 of median may stay in their HOME assisted unit and must pay the lessor of 3096 of their adjusted monthly income for rent and utilities. t 4. OCCUPANCY REQUIREMENTS A. No less than 90 percent of the HOME assisted units shall be initially ' ~ occupied by low-income families who have annual incomes that are equal to 60% or less than median as established yearly by HUD. The balance of the HOME assisted units shall be occupied by low income tenant., households. who have an annual income equal to 8096 of the median income. B. ~ For the purposes of complying with the HOME Program, each assisted HOME unit shall contain at least one bedroom or living/sleeping room for . each two persons. C.. The City will permit that 1) persons of the opposite sex, other than spouses may share a bedroom; and 2) children of any age that are of the opposite sex niay share a bedroom. 15. RELOCATION . In cases where temporary or permanent relocation will be required, the City will address all the prescribed costs as covered by the Uniform Relocation Act and provide appropriate notices. 16. RECORDS AND REPORTS The City will require that the Developer/Owner maintain the following records'and reports in. order to assist the City in meeting its record keeping and reporting requirements: A. Files on the annual review and certification of tenant income. ' B. Any information on the qualification of affordable rents..- . C. Terms and conditions of all signed leasehold agreements between tenants and Developer/Owner. ~. All legal reports and records required by City. 31 17. MONITORING A. The City is responsible for managing the day-to-day operations of its HOME program and for monitoring the performance of all entities receiving HOME funds to ensure compliance with the requirements of subpart K, 24 CFR 92, and for taking appropriate action when performance problems arise. B. Not less than annually, the City will review the activities of each owner of rental housing assisted with HOME funds to assess compliance with the ' requirement of subpart K, 24 CFR 92, as set forth in this Guideline. C. For each project,.a review will include an on-site inspection to determine compliance with housing codes and the requirements. of subpart K, 24 . CFR 92. The results of each-review will be included in the City HOME Performance Report required by part 91 of Title Il of the Cranston- Gonzalez National Affordable Housing Act of l 992 and will be made available to the public. 32 • • Daq~p CITY OF LYNWOOD FIRST-TIME HOMEBUYING PROGRAM PROCEDURES First Time Home Buyer Program Budget Total_Program Budget for F. Y. 1998-99 t Funding So ~ rce/Amount i Operating Budget Office Supplies Operating Supplies Prof. & Cont. Services Advertising & Print f l Dollars available for deferred loans $510,000 HOME - 100% Max. 10% of budget $35,000 $ 300 $ 350 $14,000 $ 350 Total . $50,000 $460,000 23 loans at a max. loan amount of $20,000 per applicant. • i CITY OF LYNWOOD FIRST-TIME HOMEBlIY1NG PROGRAM PROCEDURES INTROD~l1CTION k The Cityiof Lynwood 's First Time Home BuXers Program (FTHB) has been developed to provide -first timehomebuyers with the financial assistance necessary for home ownership. The loan is in the fond of a deferred payment second mortgage. The FTHB program is designed to assist qualified households with the down payment, closing costs, and any additional costs for the. purchaseiof a home in Lynwood. As.funding is limited, loans will be granted on a first-come first serve basis. The purpose of this FTHB Program Manual is to describe the program .and. set forth the roles of the City; of Lynwood, the Participating Lender(s), the FTHB applicant(s), and , the Program Administrator. This document contains a description of the FTHB Program requirements, processing procedures and policies. The borrower, purchase price, and mortgage underwriting requirements. as set forth in state and federal regulations are also described. FTHB processing forms are included as exhibits to this document. 4 GENERAL ELIGIBILITY RE(~WREMENTS { A. Location The City of Lynwood's First-Time Homebuying Program offers broad discretion in the types of single family properties that may be purchased within the City limits. 6. Property Type Any single family property with a property value below HIID-prescribed levels and which will serve as the purchaser's principal residence is eligible, including: Single family property 4 A Condominium unit fofll ~. C. Unit Size -All homes purdhased with Program funds must comply with FederaF HQS and State Health ;Safety Codes regarding occupancy and shall be adjusted for family size appropriate to tFie housing unit as follows: One bedroom =One to Three person household Two bedroom =Three to Six person household Three bedroom = Four to Eight person household Four bedroom = Five to Ten person household _ , D. Property Value Limitations 1 The federal regulations governing the Gty of Lynwood's First-Time Homebuying Program. require that all properties purdhased with HOME funds have a value that does not exceed 9~5% of the median purchase price for a single family unit. The property value to be purchased must be supported by a certified appraisal. Currently, 95% of the median purchase .price as established by HUD for a single family or condo unit in the City of Lynwood is 520 I ,900.00. i E. Method of Ownership For the purposes of the Gty of Lynwood's First-Time Homebuying Program, homeownership means ownership in fee simple title. This ownership interest is evidenced by a Grant Deed, Deed of Trust, 9uitclaim Deed or other debt instrument approved by the City of Lynwood. 4 III. fLIGIBLE~ PROGRAM PARTICIPANT (CHARACTERISTICS OF THE HOME BAYER) - i A. The prospective purchaser household must meet five key eligibility requirements: Must be aFirst-Time Homebuyer which is defined as a household that has not C owned a home during the three year period immediately prior to the proposed purchase, or is a household that has owned a home within the last three years but qualifies as a "displaced homemaker' or a "single parent" with minor children for I whom the individual has custody or joint custody. i i 2 of 1 1 i I I I i • ~~ ' 2. Must be bw/moderate income ,that is the purchaser must have a gross annual income that does not exceed 120 percent of the median income, based on family size, established by HUD for the City of Lynwood (see enclosed chart).. I 3. Must. occupy the property as a prinapal residence. Temporary subleases are not j allowed. Co-owners, other than owner-occupants, will not be permitted. A covenant in the tryst deed will require that the purchased property remain as the first-time homebuyer's principal residence. 4. Household shall have sufficient assets to provide a minimum down payment equal ~ to 3% of the purchase price of the home plus an additional amount to cover recurring costs. 5. Household shall have suffiaent income and aedit worthiness to qualify for primary ~ financing as defined by their selected lender. { 6. All household members must be currently living together and have been living together in the same housing. unit for a minimum of 12 consecutive months at the ~ time the application is submitted to the City. B. Determination of Adjusted Gross. Income. The applicant will be required to provide federal income tax returns for the prior three years and verification of current income to document eligibility. { 2. In calculating adjusted gross income, all of the income of the applicant and other household members 18 years of age or older and not full-time students shall be considered as follows: a. The full amount, before any payroll deductions, of wages and salaries, overtime pay, commissions, fees, tips, and bonuses, and other compensation for personal services; b. self-employed income is defined as the average of net income manifested on their federal income taxes for the last two years. NET INCOME is defined as gross income plus depreciation plus amortization plus rent deductions for use of a home; 3 of I I 1 c. .Interest, dividends, and other net income of any kind from real or 1 personal property (where the family assets are in excess of $5,000, excluding property, adjusted gross income shall include the greater of the actual income derived from all assets or percentage of such assets based on the current passbook savings rate); k d. 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, including a lump-sum payment for the delayed start of a periodic payment; e. Payment in lieu of earnings, such as, unemployment, worker's compensation, severance pay, welfare assistance Please r er to exemption information for additional information regarding emplogment status. (NOTE: Such payments may be excluded by the ,lending institution. providing the first mortgage, for purposes of underwriting, but shall be included in eligibility determinations for this program.); f. Periodic and determinable allowances, such as alimony and child support payment, and regular contributions or gifts received from persons not residing in the dwelling to the extent that such payments are .reasonably expected to continue; g. All regular pay, special pay, and allowances of a member of the Armed Forces (whether or not living in the dwelling) who is the head of the family, spouse, or other person who dependents are residing in the unit; h. Any earned income tax credit to the extent its exceeds income tax liability; and, i. Any other income that must be reported for Federal and state income tax . f purposes. • 4 I. Exceptions in the determination of adjusted gross income: The following exceptions shall apply in the determination of adjusted gross income: a. Payments received for the care of foster children; b. Amounts specifically excluded by any federal or state statute from consideration as income; c. Casual, sporadic, or irregular gifts; d. Amounts that. are specifically for, or in reimbursement of, the cost of medical expenses; e. Lump-sum additions to family assets, such as inheritance, insurance payments (including payments under health and accident insurance and worker's compensation), capital gains, and settlement for personal or property losses (these items shall be considered as assets for the purpose of this program); and f. Amounts of education scholarships paid directly to the student or to the educational institution, and amounts paid by the government to veterans for use in meeting the costs of tuition, fees, books, and equipment. Assets for-the determination of eligibility .For the purpose of the Program, the following will be considered assets for determination of eligibility: a. Cash savings, marketable securities, stocks, bonds and any other form of capital investments other then IRAs, KEOGH plans or other retirement vehicles. b. Inheritances, lump sum insurance payment. c. Any equity in real estate {rental property) d. ~ All assets, less a mortgage and emergency reserve of $5000.00 shall be . provided by applicants as a required downpayment towards the purchase price. 5 of I I • IV. DETERMINING-GROSS INCOME t . Gross Income for the purposes of qualifying for the first mortgage: a: III be determined by the participating Lender's underwriter of the first mortgage pursuant to their respective investors criteria; b. In all cases, overtime, bonuses, etc. will be considered "consistent" by the underwriter and included in the calculation of gross income if it has been received for a period of at least 18 c. Averaging of overtime or gross income will be allowed only when the underwriter is required to average pursuant to his investor criteria. 2. Gross income for the purpose of qualifying for the City s assistance will be determined by: a. l.lsi ~ the first mort a e borrowe-'s current Verification of Em to ment OE as indicated lg g g p Y N) in (i) and (ii), below, PLUS all gross income of household members even if the first mortgage lender cannot use it: i. ~ e current hourly rate t-"mes the number of hours worked per week L~us overtime pay, commissions, fees, tips, and bonuses, and other compensation for personal services, etc., if they has been consistently earned for f 8 months; or ii. The current base salary ~ overtime pay, commissions, fees, tips, and bonuses, and other compensation for personal services, etc., if they has been consistently earned for . ~I 8 months. b. Inco~ a for self-em to ed rsons is defined as the hi her f i p y pe g o e ther (I) current year to date net income or (2) the :highest net income shown on any one of the applicant's last three years federal income tax forms. 'NET INCOME is defined as gross income ~ depreciation plus amortization ~ business deductions for use of a home. Note: Overtime .pay, commissions, fees, tips, and bonuses, and other compensation for . personal services etc. must be broken down on the VOE by the employer. 3. EmploXment Status - -All persons in the household showing a work history in the last three years must be employed at a status (i.e., part or full-time) similar to that of their previously held job(s). For example, if a person has worked in any one of the last three years but is currently unemployed for various reasons including, but not limited to, (I) being laid-off; (2) temporarily disabled; (3) attending school; or (4) -s not working. ~ has held a job withirr the last twelve months prior to submitting an application, the City cannot provide assistance until he/she has been re-employed for a period of twelve months at a status similar (i.e., part or full-time) to their previously held. job(s). 6 of I I V. PROPERTY STANDARDS. i ~ " " I cu an the roe must fr fr m an d I . At the t e of mina oc p cy, p p rty be ee o y elects that pose a danger to the health or safety of the occupants and must meet minimum property standards (Housing Quality Standard. 2. The proprty must be currently occupied by the owner or vacant. Rental property cannot be purchased ~_ through the Citys Program. VI. TERMS AND CONDITIONS OF THE CITY OF LYNWOOD'S DOWN PAYMENT ASSISTANCE The Gty ~f Lynwood has elected to provide down payment assistance to eligible households for the purpose of assisting them in the acquisition (purchase) of a principal residence.: I . City ~ own payment assistance is furnished as a deferred loan with 0% interest accrual } 2. The City's down payment assistance is provided as a loan which is secured against the property by executmg a deed of trust, with covenants outlining the principal residence requirements. This recorded deed (places a lien against the subject property being purchased utilizing the Cit}rs funds as down payment assistance. 3. THERE ARE NO MONTHLY PAYMENTS. The FTHB loan will be f r iven over the term of the loan (20 years). If the applicant sells or trensfers title of the property the loan balance will become due and payable. The .loan is due and payable also when the property is refinanced or a change in title occurs. 1 4. The FTHB .may be due and payable if the Applicant fails to comply. with program requirements.. A . FTHB~ may be revoked under certain circumstances. For example, revocation occurs if the residence ceases to be Borrowers Principal Residence. 5. Strict ~ Wallies ma be im sed on an licant makin a material misstatement, misre resentation, IPe Y Po Y APP g P or fraudulent act on documents submitted to obtain a FTHB loan. Any person making a negligent material misstatement or misrepresentation in any affidavit or certification. made in connection with the application for , or the issuance of a FTHB loan, shall be subject to all applicable fines and penalties. 7 of I I ® • .VII. DOWN PAYMENT ASSISTANCE (DEFERRED LOAN) LIMITS The Federal Department of Housing and Urban Development (Hl1D) has established theper-unit dollar limit of HOME funds that maybe used by the Gty of Lynwood to assist in the expansion of the supply of decent, safe, sanitary and affordable housing. 'In all instances, the down payment assistance will be the minimaF amount necessary in order to assume that the subject property will be initially affordable to the first-time homebuyer. To accomplish this the following shall apply: I . .The a~ pliant shall obtain a bank loan with a housing expense ratio (i.e., front-end ratio) of not less that 30% nor more than 33%. Housing expense includes principal l~us taxes {assessments)~lus interest f~ insurance plus homeowners association dues, if applicable. 2. The a I plicanf shall contribute all available assets towards the purchase of the property except that the applicant may keep up to two months Principal ~ Interest ~ Taxes ~ Insurance as a reserve. VIII. ADDITIONAL CONDITIONS The Gty shall be named as a beneficiaryon the hazard insurance policy and shall be notified of modifications and/or cancellations of insurance coverage. Refinancing ma be allowed for the u ose of reducin the month a ents du o I m r g y p rp g ly p ym e t ower arket rote est rates. Under no circumstances shall refinancing take place for cash-out. 8 of I I IX. F1RST-TI {ME HOMEI~NG ASSISTANCE PROGRAM APPLICATI~ROCEDIIRES 1 A. The c;ty of Lynwood intends to advertise the availability of the. First-Time Hamebuying Assistance Program funds as follows: 1. Public Notice 2. ''Direct Ads 1 3. 'Press Release 4. Notification to the appropriate Board of Realtors I 5. ~ irect Notice to Non-profit entities and other Community Service Providers B. The Program notices shall contain the following information: I . 1Purpose of the program 2. ~ eRrrs of financial assistance ' 3. Eligibility criteria l 4. Income. information C. Intere~ ted Pro ram licants will contact the G to obtain an a lication acka e. Included in the g APP tY PP P g Application package shall be: (Application Form 2. ..Fact .Sheet 3. Statistical Form D. 'The P~ogram applicant will submit a completed application and shall be required to provide federal tax retum~ for the prior three years. The applicant shall also be required to provide verification of current income, such as two months pay stubs. E. The Program Administrator will process applications on a first-come, first-served basis. Each application shall be date stamped upon receipt. The Program Administrator shall review each application noting the five eligibility requirements. For each eligible applicant, a credit report shall be obtained to determine the credit worthiness of each applicant. The Gty will authorize the approval or denial of each F. The to e of ti 6. At a in tl 6e c ry will prepare the Pre-Approval correspondence. This "reservation" shall be gelid for ninety days ale an applicant to receive funding approval from a selected Lender and to locate the housing unit ~ choice. time during the process that an applicant becomes ineligible according to the criteria set forth the applicant shall be eliminated from the program and the next eligible applicant in priority shall 9 of I I X. FIRST-TIME HOMEBUYER TRAINING COURSES A. The ~ro ram re wires that all re-a roved a licants attend sessions that are conducted b g q P PP PP Y their ~ articipating Lender regarding homeownership as follows: I . Preparing for Homeownership hdentifying what the Participant wants and needs in a home, determining. what Participant can afford to spend. 2. Shopping for a Home .. Size requirements, how a real estate agent. can help, House evaluation, submitting an offer, professional home inspection process. 1 3. {Obtaining a Mortgage I Discussion of loan terms, loan .processing. 4. {Closing Title insurance, termite inspection, estimate of closing costs, advance payments, understanding the obligation, procedures for the formal loan closing. 5. ~ife as a Homeowner I~ enti in the basic ste s to ensure home safe ,Basic ste s for maintenance basic fY g p tY P steps for setting a household budget. 10 of I I +~ XI. SELECTING THE PROPERTY A. U o~ Lender a royal, the eli ible household will locate an eli ible ro that is for sale. P ~ PP g g P Pem' B. The selected .home must be considered "affordable", that is, all monthly housing costs shall not ' exceed Program limits. In calculating housing costs, alt of the following associated with the housing unit shall be included: t. Principal and interest on the first mortgage loan, including any loan insurance fees. 2. Property tax and assessments.. . 3. Fice and casualty insurance covering the replacement value. C. Program participants may retain a real estate agent for the purpose of locating and ' offering to purchase the selected eligible property or may negotiate directly with the homeowner. The escrow agent shall be selected by the Seller. XII. CLOSING/Fl1NDIN6 RE(~llIREMENTS A. ll on acce tance of the offer to urchase the Pro ram artici ant shall inform the ,P P P ~ g P P Program Administrator about the selection of a property. The Program Administrator shall coordinate with the participating Lender and the selected escrow company to obtain necessary information such as: Sales Price 2. Address of selected. property 3. Estimated Closing Date 4. Appraisal B. The Program Administrator shall request that the City conduct the required property inspection to assure that the property meets Program HG2S requirement. m ntation C. Upon notrficatron, the Program Administrator shat prepare all necessary docu e _ to secure the City's interest in the purchased property. All documentation shall be delivered to the escrow holder prior to loan closing. (I of I I O FIRST-TIME HOMEBUYER SUMMARY Prooram Requirements Household or individual must meet the followino eligibility requirements: 1. Must be a First-Time Homebuyer which is defined as a household that has not owned a home during. the past three years or is a household that has owned a home in the last three years, but qualifies as~a "displaced homemaker" or a "single parent". 2. Must. have an annual income that is 120 percent, or less, of HUD median income, based on family size. (See attached chart.) 3. Must occupy the purchased property as a principal residence. 4. Shall have `sufficient assets to provide a minimum downpayment equal to 3% of the purchase price of the~home. 5. Shall have sufficient income and credit worthiness to qualify for primary financing as defined by their selected Lender. Property Type 1. Any single family property with a property value at HUD-prescribed levels generally; not to exceed 95% of the area median home value and will serve as the purchasers principal residence is eligible, including: single family. property or a condominium unit. 2. The purchased unit must be located within the City of Lynwood. 3. Property cannot be located in an area subject to excessive noise levels or other hazards specifically identified by the City of Lynwood. Down payment assistance (up to a maximum of $20,000.) will be provided, depending on need, to eligible households forthe purpose of assisting them in the purchase of a home. Closing costs can also be paid. The loan- may be fo~given over the term of the loan (20 years). 1. Down payment assistance will be furnished as a deferred loan with 0% interest. 2. After securing the loan with a deed of trust, a lien will be placed against the property that is being purchased with City funds. as down payment assistance. 3. Eligible First-Time Homebuyers must also attend homebuyer counseling and training sessions held by their selected lender. 1. Assistance.~will be terminated if the property does not remain as the principal residence or the City discovers willful misrepresentation by the first-time homebuyer in connection with the First-Time Homebuyers Program. 2. Residence must meet Housing Quality Standards and unit size requirements. 1 bedroom 1-2 people 2 bedroom 2-6 people 3 bedroom 4-8 people 4 bedroom 5-10 people 3. If First-Time Homebuyer sells or transfers the property within the twenty year affordability period, the repayment of the remaining balance of the City's assistance will be paid to the City. After your application and proof of income (income tax returns for the last 3 years) is submitted to the City of Lynwood, it will be forwarded to the Program Administrator for loan processing. You will receive notice regarding your eligibility in 21 days. ~,> CITY OF LYNWO D O _DOWN PAYMENT ASSISTANCE PROGRAM Application Package Checklist. Dear. Applicant: Thank you for your request for information regarding the City of Lynwood's Down Payment Assist ~ rice Program (DAP) for First-Time .Home Buyers. Please find enclosed a description of the City's program guidelines and income :..requirements. . The Program application process is easy. Just complete and execute the attached application and'make sure to have attached copies of the following items: c~ 1. Application Package: Filled out completely and signed by all applicants. ~ 2. Copy of past three years Federal Tax Returns (1040) and W-2 forms. r~ 3. Proof of income for all household members: Three (3) most current pay stubs or verifications of income, letters from sources of incorne such as Social Security. ~ 4. Verification of other income including AFDC, disability, unemployment, etc. 5. Copies of three (3) most recent bank statement and proof of assets such as copies of Treasury bonds, Certificates of Deposit, retirement fund statements (401 K, IRA, and 457K), etc. ~ 6. Copy of applicants}current identification such as Driver's license, Passport, Resident°Alien Card. or California Identification Card. NOTE: These Identification cards must have photo insert on LD. 7. Proof of family household make-up to include birth certificates and social security cards for all family members. a~ 8. Proof of current rentpayment (receipt). ~ 9. Copy of monthly utility payment for water, trash, gas and electricity, if paid by household. ~ 10. Copy of Divorce Decree or Separation Agreement, if applicable. Should.you hav ~ any questions concerning the application process, contact Don Adams, Program Administrator at (310) 603-0220. Submit complet ~d applications to Community Development Department, City of Lynwood, City Hall, 11330 Bullis Road, Lynwood, CA 90262. INCOMPLETE APPLICATIONS WILL NOT BE PROCESSED!! You will receive'notification regarding your program eligibility within twenty-one (21) business days.. { . CITY OF LYNWOOD fIRST-TIME HOMEBUYER PROGRAM APPLICATION Information provided herein shall be kept confidential and shall be used for the sole purpose of determining eligibility and collecting statistical data for the City of Lynwood's First-Time Homebuyer Program. Work Applicant Age Phone Current Residence Address Zip Home Phone (_,) Previous Address {1f residing less-than 3 years at above address) ' Zip Social Security Number Co-Applicant Work or Spouse Age Phone Residence Address Zip Home Phone (~ ) Previous address (if residing. less than 3 years at above address) Zip Social Security Number 3 Household Composition List the .head of your household and all members who live in your home at the time of application. Give the relationship of each family member to the head.. Member No. Full Name Relationship Age Social Security No. Head of Household 2 3 4 5 6 7 8 9 10 If any member of your family is disabled or handicapped, state nature of disability Number of dependents under the age of 18 living at home • EMPLOYMENT DATA Applicant Employer Address Occupation Monthly Gross Income $ Previous Employer (if with. present employer less than 2 years). Address Occupation Monthly Gross Income $ Co-Applicant or Spouse ,.Employer Address Occupation Monthly Gross Income $ . Previous Employer (if with present employer less than 2 years) Address Occupation Length. of Employment yrs Phone ( ) employment # (yrs) Phone ( ) employment # (yrs) Phone(_) employment # (yrs) Phone ( ) Monthly Gross Income $ Other Present Monthly Income (if applicable) APPLICANT Interest from savings $ Interest from CD's $ Social Security $ Rentallncome $ Child Support $ . Foster Care $ Pension $ Alimony $ AFDC, Unemployment, etc. $ Other $ CO-APPLICANT OR SPOUSE TOTAL PRESENT GROSS MONTHt_Y HOUSEHOLD INCOME $ '. (Total Monthly Gross Income plus Other Monthly Income) • PRESENT MONTHLY EXPENSES To whom paid Rent Payment Auto Payment Other Regular Pmnts (Loans, etc) Credit Card Credit Card ti ~ Credit Card Other Other Monthly Payment Balance $ $ $ $ $ $ $ $ $ $ $ $ • • ASSETS: Savings Balance $ Where Checking Balance $ Where Stocks, Bonds, Other Investments (Itemize & List Values) Retirement Accounts (IRA, 401 k, etc) IMPORTANT -READ BEFORE SIGNING: I (we) certify that 1 (we) have not owned any real property forthe past three years and that the above statements are true. I (we) authorize the City of Lynwood to verify credit worthiness. Applicant's Signature Date Co-Applicant's Signature Date INCOMPLETE APPLICATIONS WILL NOT BE PROCESSED • CITY OF LYNWOOD FIRST-TIME HOMEBUYERS PROGRAM -STATISTICAL INFORMATION The following information will be .kept confidential and used only to provide aggregate data for program analysis. The .information provided will be separated from your application and maintained separately. ,Completion of this form is optional and will not be used to evaluate your application for participation in this program. The Head of Household is (please mark one): . White -Black Hispanic -Mexican, Puerto Rican, Cuban, Central or South American or other Spanish culture or origin, .regardless of race. Asian or Pacific Islander -Descendant of the peoples of the Far East; Southeast Asia, the Pacific Islands or the Indian Sub-Continent, including for example China, . Japan, Korea, the Philippine Islands, and Samoa. American Indian or Alaskan Native Please Mark One: [ ]Female [ ]Male Age bracket (head of household) 18-24; _ 25-34; _ 35-44; _ 45-54; - 55-64; _ 65 ~ older CITY OF LYNWOOD Down Payment Assistance Program Release of Verification I/we, ,the undersigned hereby. authorize to release without liability to the City of Lynwood or its agents, any and all information they may request. INFORMATION COVERED I understand that, depending on .program policies and requirements, previous or current information regarding me or my household. may be needed. Verification and inquiries that may be requested include, but are not limited. to: Identity and Marital Status Employment, Income, and Assets Medical or Child Care Allowance Credit and Criminal Activity Residences and Rental Adiv' I understand that this authorization cannot be used to obtain any information about me that is not pertinent to my eligibility for, and continued participation in, the HOME Program. GROUPS OR INDIVIDUALS THAT MAY BE ASKED ` .The groups or individuals that may be asked to release information (depending on program .requirements} include, but are not limited to: Previous landlords (including Past ahd Present Employers Public Housing Agendes)Welfare Agendes Courts and Post Offices State Unemployment Agendes • Schools and Colleges Soda) Security Administration Law Enforcement Agendes Medipl and Child Care Providers Support and Alimony Providers Banks and other Financial Institutions Veterans Administration Retirement Systems Utility Companies Credk Providers and.CredihBureaus CONDITIONS I agree that a photocopy of this authorization may be used for the purposes stated above. The original of this authorization is on file and will stay in effect for a year and. one month from the date signed. I understand 1 have a right to review my file and correct any information that I can Prove is incorrect. Head of Household (Print Name) Date (signature) Spouse . (Print Name) -Date (signature) Adult Member (Print Name) Date (signature) Rdult Member - (Print Name) Date (signature) ! ~ CITY OF LYNWOOD FIRST-TIME HOMEBUYING PROGRAM INCOME CHART- 50% - 80% of Adjusted Median Income Limits Subject m Chenpe: January, 1988 Household Size Eligible lncorne 1 Person 17,950 - 28,750 2 Person 20,500 - 32,850 3 Person 23,100. - 36, 950 4 Person 25,650 - 41,050 5 Person 27,700 -44,300 6 Person 29,750 - 47,600 7 Person 31800 - 50,900 8 Person 33,850 -54;150 INCOME CHART- 80% - 120% of Adjusted Median income Limits Subject>b l.hanpe: January, 1990 . Household Size Eligible Income 1 Person 28,750-43,400 2 Person 32,850 - 49,250 3 Person 36,950 - 55,400 4 Person 41, 050 - 61, 550 5 Person 44,300 - 66;450 6 Person 47,600 - 71,.400 7 Person 50, 900 - 76, 300 8 'Person 54, 450 - 81,250 • Name Address City/State/Lip RE ESCROW # December 13, 1996 Dear Escrow Officer: Enclosed please find the City of Lynwood's Fast-Time Homebuyers Program loan documefis for .Lynwood, CA 90262. Instructions forthese documents are as folbws: O Promissor~Note - (a) Execute and return original to Comprehensive Housing Services. (b) Insert Legal Description as Exhibit A. (c) Borrower(s) to receive one certdied rnpy. O Unsecured Promissory Note - (a) Execute and return original to Comprehensive Housing Services. (b) insert Legal Description as Exhibit A. (c) Borrower(s) to receive one certfiied rnpy. O Subordinated Deed of Trust - (a)Execrrte and forward original for reoordatron in second position behind the fast trust deed. (b) Insert Legal Description as Exhrbit A. (c) Insert date for beginning. of impound payments on page 2. (d) Comprehensive Housing Services to receive one certified copy. (e) Borrower(s) to receive one certified rnpy. O Truth In LendinY Statemerrt(sl - (a) Execute and return original to Comprehensive Housing Services. (tor secured ~ UnsecrredJ (b) Borrower(s) to receive one certified copy. O Settlement Statement - (a) Comprehensive Housing Services to receive one certified copy within 24 hours. (b) Borrower(s) to receive one certified. copy. O Title Insurance -Title Insurance shall be obtained for the City of Lynwood's secured sernnd mortgage loan. The cost of this insurance shall be the responsibility of the borrower(s). O Check in the amount of $ 0.00 made payable to to be handed over to Escrow once (1) all documents have been properly executed and returned to Comprehensive Housing Service, Inc. and (1) all items in these Escrow Instructions are satisfied. O The City of Lynwood shall be added as second mortgagee on the borrower(s) hazard insurance as follows: Clty of Lynwood Community Developmerrt Department/First-Time Homebuyers Program 11330 Buliis Road, Lynwood, CA 90262 O Evidence (in the form of a City of Lynwood letter) confuming that the subject property has passed the City's budding and safety inspection shall be handed over to Escrow by the borrower(s) prior to the cbse of escrow . O Borrower(s) to hand over to escrow an original, signed copy of the "HOME Program Homeownership Notice to Sellers" prior to-cbse of escrow. Escrow shall forward this original "Notice" to Comprehensive Housing Service, Inc. at the close of escrow. If you have arty questions, please feel free to call me at (714) 841-6610. Sincerely, Gayle Bloomingdale, Program Manager cc: Donyea Adams, City of Lynwood K:~cuerrrst,vrvwooowrHa~®.r~w 1 Of -1 S~ER FINANCING DISCLOSURE STAT~NT _, -~-- (Federal, truth-in-lending Act) Down Payment Assistance Program Creditor: City of Lynwood Community Development Department 1 1330 Bullis Road Lynwood, CA 90262 - . IJ , ,, / ~:, J -~~: , ANNUAL FIrIANCE Amount Total of PERCENTAGE CHARGE Financed Payments RATE The cost of your credit The dollar amount the credit The amount of credit provided to The amount you wdl have paid as a yearty rate. wi71 cost you. you or on your behalf. after you have made all payments scheduled. ~~b! ~ $20,000.00 ~ $0.00 Your payment schedule will be: Number of Pa ments Amount of Pa ments When Pa ments Are Due Due on sale, transfer, lease, cash out refinance 0 $ or family trust transfer of any part of the Property and/or when Borrower ceases to reside in the property. Deferred forgivable for twenty (20) years; 2096 wdl be forgiven each ear for twen ears. Security: You are giving a securing interest.in the property being purchased and any premium refunds or proceeds received under any property insurance policy. Property Insurance: You may obtain property insurance from anyone you want that is acceptable to Creditor. late Charge: To be determined. Filing Fees: $0.00. Prepayment: If you pay off early, you wilt not have to pay a penalty. Assumption: Some one buying your house cannot assume the remainder of your mortgage on the original note. See yourcontract documents for any additional information about non-payment, default, any required repayment in full before the scheduled date, and prepayment refunds and penalties. The undersigned hereby acknowledges receiving a copy of this Statement. Borrower. Date Borrower Date. K:\CLIENTS\ELNONTE\FTHB~DOCSIDEED.NEW ~ Of 2 ,, SELLER FINANCIlVG .DISCLOSURE ~~'EMEM' December 13, 1996 . ITEMIZATION OF AMOUNT FINANCED The City of Lynwood is giving you security interest in its property located at: . Itemization of the Amount Financed of $20.000.00 from the City of Lynwood Community Development Department (Creditor): Amount given to you. directly Amount paid to others on your behalf: $ -n- to credit bureau. for credit report -n- to appraiser -n- to escrow for escrow fee $ -~- to public officials $ -n- to title company for title insurance $ ~n,nnn nn to Fcrrrtut C'mm~any $ -n- to The undersigned hereby acknowledges receiving a copy of this Statement. Borrower Date Borrower Date K:\CLIENTS\ELYONTE\FTHB\DOCS\DEED.NEW Z Of 2 ~. ~. r r. ','~ '~ .WHEN RECORDED MAIL TO: ~ ' if ~~ .CITY OF LYNWOOD City Halt i 1330 Bullis Road . Lynwood, CA 90262 EXEMPT RECORDQVG FEE CODE 6103 SUBORDINATE DEED OF TRUST 1 THIS SUBORDINATE DEED OF TRUST ("Security Instrument") is made this _ day of 1997, among the Trustor(s), (herein "Borrower"}, COMPREHENSIVE HOUS[NG SERVICES, INC. (herein "Trustee"), and the Beneficiary, whose is the C[TY OF LYNWOOD, a public agency (herein "Lender"). BORROWER, in consideration of the indebtedness herein rented and the trust herein created, irrevocably grants and conveys to Trustee, in trust, with the power of sale, the following described. property located in the County of Los Angeles, State of California: LEGAL DESCRIPT/ONATTACHED HERETO AS EXH/B/T A. which has the address of ,Lynwood, California, 90262 (herein "Property. . Address"). TOGETHER with alt the improvements now or hereafter erected on the property, and all easements, rights, appurtenances and rents (subject however to the rights and authorities. given herein. to Lender to collect and apply such rents), all of which shall be deemed to be and remain a part of the property covered by this Security Instrument; and all of the foregoing, together with said property (or the leasehold estate if this Security Instrument is on a leasehold) are hereinafter referred tows the "Property" . K.•1CIJFMSt3.NG4YlE~FlffE1~OCS1D®NETY 2 of 13 .... ~ ~~ '. TO SECURE to Lender the repayment of the indebtedness evidenced by Borrower's Pronssory Note dated and extensions and renewals thereof (herein "Note"), in the principal sum of U.S. $ advanced in accordance and herewith to protect the security of this Security Instrument;. and the performance of the covenants .and agreements of Borrower herein. contained. The loan evidenced by the Promissory Note and secured by this Security Instrument is being made pursuant to the HOME Investment Partnership Program and the regulations issued .thereunder. In addition to the Loan, the Borrower obtained a Deed of Trust loan. (The "First Deed of Trust . ` Loan's from (the "Senior Lien Holder"), which loan is secured by first deed of trust lien on the Property. Borrower covenants that Borrower is lawfully seized of the estate hereby conveyed and has the - right to grant and convey the Property, and. except for the first Deed of Trust and other encumbrances of record acceptable to the Senior Lien Holder, that the Property is unencumbered. Borrower warrants and will defend generally the title to the Property against all claims and demands, subject to encumbrances of record. UNIFORM COVENANTS.- Borrower and Lender covenant and agree as follows: l . Payment of Principal and Interest. Borrower shall promptly pay when .due the principal indebtedness evidenced by the Promissory Note. This Note shall. be deferred forgivable for twenty (20) years, 20% will be forgiven each year for twenty years. 2. Funds for Taxes and Insurance. Subject to applicable law, Borrower shall pay to the Senior Lien Holder a sum (herein "Funds") equal to (a) yearly taxes. and assessments (including condominium and planned unit development assessments, if any) which may attain priority over this Security Instrument, and ground rents on the Property, if any, (b) yearly leasehold payments or ground rents on the Property, if any; (c) yearly premium installments for hazard insurance, (d) yearly premium installments for mortgage insurance, if, that are reasonably estimated initially and from time to time by the Senior lien Holder on the basis of assessments and bills and reasonable estimates thereof. 1 If Borrower pays Funds to Lender, the Funds shall be held in an institution the deposits or accounts of which are insured or guaranteed by a federal or state agency. Lender shall apply the ? Funds to pay said.taxes, assessments, insurance premiums and ground rents. Lender may not charge ~ ° for so holding and applying the Funds, analyzing said account or verifying and compiling said assessments and bills,. unless Lender pays Borrower interest on the Funds and applicable law permits f : Lender to make such a charge. Borrower and Lender may agree in writing at the time of execution I ~ of this Security Instrument that interest to be paid, Lender shall not be paid to Borrower, and unless ~:. such agreement is made , of applicable law requires such interest to be paid, Lender shall not be required to pay borrower any interest or earnings on the Funds. Lender shall give to Borrower, without charge, an .annual accounting of the Funds showing credits and debits to the Funds and the purpose for which each debit to the funds was made. The funds are pledged as additional security for the sums secured by this Security Instrument. K~~cunvrs~ura~rr~r~oo~cswtmmw 3 of 13 i If the amount of the Funds held by Lender, together with the future monthly installments of Funds payable prior tothe due dates of taxes, assessments, insurance premiums and ground rents exceed the amount required to pay said taxes, .assessments, insurance premiums and ground rents as they fall due, such excess shall be, at Borrower's option, either promptly repaid to Borrower or credited to Borrower on monthly installments of Funds. If the amount of the Funds held by Lender shall not be sufficient to pay taxes, assessments, insurance premiums and ground rents as they fall due, Borrower shall -pay to Lender any amount necessary to make up the deficiency in one or more payments as Lender may require. Upon payment in full of all sums secured by this Security Instrument, Lender shall promptly refund to borrower any Funds held by Lender. If the Property is sold or the Property is otherwise acquired by Lender, Lender shall apply, no later than immediately prior to the sale of the Property or its acquisition by Lender, any Funds held by Lender at the time of application as a credit against the sums secured by this Security Instrument. 3. Prior Mortgages and Deeds of Trust; Charges; Liens. Borrower shall. perform all of Borrower's obligations under any mortgage, Deed of Trust or other security agreement with a lien which .has priority over this Deed of Trust, including Borrower's covenants to make payments - when due. Borrower shall pay or cause to be paid all taxes, assessments and other charges, fines and impositions attributable to the Property which may attain a priority over this Security Instrument and leasehold payments or ground rents, if any. 4. Subordination. Lender and Borrower acknowledge and agree that this Security Instrument is subject and subordinate in all respects to the liens, terms, covenants and conditions of the First .Deed of Trust and to all advances heretofore made pursuant to the First Deed of Trust including all sums. advanced for .the purpose of (a) protecting or further securing the lien of the First Deed of Trust, curing defaults by the Borrower under the First Deed of Trust or for any other purpose expressly permitted by the First Deed of Trust or (b) constructing, renovating, repairing, furnishing, fixturing or equipping the Property. The terms and provisions of the First Deed of Trust are paramount and controlling, and they supersede any other terms and provisions herein conflict therewith. In the event of a foreclosure of the First Deed of Trust, any other provisions in any other collateral agreement restricting the use of the Property to low or moderate income households or otherwise restricting the Borrower's ability to sell the Property shall have no further force or effect on subsequent owners or purchasers of the Property, Any person, including his/her successors or assignees (other than the Borrower or a related entity of the Borrower), receiving title to the Property through a foreclosure or Deed in lieu of foreclosure of the First Deed of Trust shall receive title to the Property free and clear from such restrictions. Further, if the Senior Lien Holder acquires title to the Property pursuant to a Deed in Lieu of foredosure, the lien of this Security Instrument shall automatically terminate upon. the Senior Lien .Holder's acquisition of title, provided that (1) the Lender has been given written notice of a default under the First Deed of Trust and (2) the Lender shall not have cured the default under the First Deed of Trust; or diligently pursued curing the default as determined by the Senior Lien Holder, within the K.,cuavrs~u+ciYrE~-rfm,odrswrm,~u, 4 o f 13 • • 60-day .period provided in such notice sent to the Lender. 5. Hazard Insurance. Borrower shall keep the improvements now existing or hereafter erected on the Property insured against loss by fire, hazards included .within the term "extended coverage",~ and such- other hazards, including floods or flooding. This insurance shall be maintained in the amounts and for the periods that the Senior lien Holder and/or the Lender may require and in such amounts and for such periods as the Senior Lien Holder and the .Lender may require. .The insurance carrier providing the insurance shall be chosen by Borrower. All insurance policies and renewals thereof shall include a standard mortgage clause in favor of and in a form acceptable to Lender. Lender shall have the right to hold the policies and renewals thereof, subject to the terms of any mortgage, deed of trust or other security agreement with a lien which has priority over this Security Instrument. All original policies of insurance required pursuant to the First Deed of Trust shall beheld by the Senior Lien Holder;. provided, however, Lender may be named as a loss payee as its interest may appear and may be named as an additional insured. If Lender requires, Borrower shall promptly give to Lender copies of ail receipts of paid premiums and renewal notices. In the event of loss, Borrower shall give prompt notice to the insurance carrier, the Senior Lien Holder and the Lender. Lender may make proof of loss if not made promptly by the Senior Lien Holder or the Borrower. Unless Lender and Borrower otherwise agree in writing, insurance proceeds shall be applied to restoration or repair of the Property damaged, if the restoration or repair is economically feasible or Lender's security would be lessened; the insurance proceeds shall be applied to the sums secured by this Security Instrument, whether or not then due, with any excess paid to Borrower. If the Property is abandoned by Borrower,. or if the Borrower fails to respond to Lender within 30 days. from the date notice is mailed by Lender to Borrower that the insurance carrier offers to settle a claim for insurance benefits, Lender is authorized to collect and apply the insurance proceeds at .Lender's option either to restoration or repair of the Property or to the sums secured by this Security Instrument., Not withstanding the above, the Lender's rights to collect and apply the insurance proceeds hereunder shall be subject and subordinate to the rights of the Senior Lien Holder to collect and apply such proceeds in accordance with the First Deed of Trust 6. Occupancy, Preservation and Maintenance and Protection of the Property. Borrower shall .occupy. establish, and use the Property as the Borrower's principal residence and shall keep the. Property in good repair and shall not, commit waste or permit impairment or deterioration of the. Property and shall comply with .the provisions of any lease if this Deed of Trust is on a leasehold. 7. Protection of Lender's Security. If Borrower fails to perform the covenants and agreements contained in this Security Instrument, or if anylegal action or proceeding is commenced k.t~,~vrs~zMaYr~nsa,oocs~a®,n~c, 5 ofi 13 • • ~ {.: which materially affects Lender's interest in the Property, the Lender, at Lender's option, upon notice to Borrower, may make such appearances, disburse such sums, including reasonable attorney's fees, and. take such action as is necessary to protect Lender's interest. Lender's actions may include paying any sums secured by a lien which. has priority over this Security Instrument. Any amounts disbursed by Lender pursuant. to this paragraph 7, with interest thereon, at the Note rate, shall become .additional indebtedness of Borrower secured by this Security Instrument. Unless Borrower and Lender agree to other terms of payment, such amounts shall be payable upon notice from Lender to Borrower requesting payment thereof. Nothing contained in this paragraph 7 shall require Lender to incur any expense or take any action hereunder. -Prior to taking any actions, Lender shall notify the Senior Lien Holder and shall provide the Senior Lien Holder with opportunity to cure a default hereunder advanced by the Senior Lien Holder and shall be secured by the First Deed of Trust. The Senior Lien Holder shall have the right to exercise all rights and remedies under the First Deed of Trust. 8. Mortgage Insurance. If Lender requires mortgage insurance as a condition of making the loan secured by this Security Instrument, Borrower shall pay the premiums required to maintain the mortgage insurance in effect. 9. Inspection. Lender or its agent may make or cause to be made reasonable entries upon and inspections of the Property, provided that Lender shall give Borrower notice prior to any such. inspection specifying reasonable cause therefore related to Lender's interest in the Property. 10. Condemnation. The proceeds of any award. or claim for damages, direct or consequential, in connection with any condemnation or other taking of the Property, or part thereof, or for conveyance in lieu of condemnation, are hereby assigned and shall be paid to Lender, subject to the teens of any mortgage, deed of trust or other security agreement with a lien which has priority over this Deed of Trust. In the event of a total taking of this Property, the proceeds shall be applied to the sums secured by this Security Instrument, whether or not then due, with any excess paid to the Borrower. 1 1. Borrower not Released; Forbearance by Lender Not a Waiver. Extension of the time for payment or modification of the sums secured by this Security instrument granted by Lender to any successor in interest of Borrower shall not operate to release, in any manner, the liability of the original Borrower and Borrower's successors in interest. Lender shall not be required to commence proceedings against such successor or refuse to extend time for payment or otherwise modify the sums secured by this. Security instrument by reason of any demand made by the original Borrower and Borrower's successors in interest. Any forbearance by Lender in exercising any right or remedy hereunder,.-or otherwise afforded by applicable law, shall not be a waiver of or preclude the exercise of any such right or remedy. K.,a,Exrs~z,,+a~vrt~-r,~,oocs~o®.~v~, 6 o fi 13 12. Successors and Assigns Bound; Joint and Several Liability; Co-signers. The covenants and agreements herein contained shall bind, and the rigfits hereunder shall inure to, the respective successors and assigns of Lender and Borrower. All covenants and agreements of Borrower shall be joint. and several. 13. Notices. Except.for any notice required under applicable law to be given in another manner, (a) any notice to Borrower provided for in this Security Instrument shall be given by delivering it or by mailing such notice by certified mail addressed to Borrower at the Property Address or at such other address as Borrower may designate by notice to Lender as provided herein, and (b) any notice to Lender shall be given by certified mail to Lender's address stated herein. Any notice provided for in this Security Instrument shall be deemed to have been given to Borrower or Lender when given in the manner designated herein. Any notices required to be given to the Lender shall be given by first class mail to the following address: City of Lynwood Community .Development .Department First-Time Homebuyers Program 1 1330 Bullis Road Lynwood, CA 90262 or such other address the Lender designates by notice to the Borrower. l 4. Governing Law; Severability. The state and local laws applicable to this Security Instrument- shall be the laws of the jurisdiction in which the Property is located. The foregoing sentence shall not limit the applicability of federal law to this Security Instrument. In the event that. any provision or clause of this Security Instrument or the. Promissory Note conflicts with applicable law, such conflict shall not affect other provisions of this Security Instrument or the Promissory Note which can be given effect without the conflicting provision, and to this end the provisions of this Security instrument and the Promissory Note are declared to be severable. As used herein, "costs", "expenses" and "attorneys' fees" include all sums to the extent not prohibited by applicable law or limited herein. 15. Borrower's Copy. Borrower shall be furnished a conformed copy of the Promissory Note and Security Instrument at the time of execution or after recordation hereof. 16. Transfer of the Property or a Beneficial Interest in Borrower. Except for a conveyance to the trustee under the First Deed of Trust, if all or any part of the Property or any interest in it is sold or transferred without Lender's prior written consent, Lender may, at its option, requires immediate payment in full of all sums secured by this Security Instrument. This option shall not be exercised by the Lender if the exercise is prohibited by federal law as of the date of this Security Instrument. If the Lender exerases this option, Lender shall give Borrower and the Senior Lien Holder ..prior written notice of acceleration. The notice shall provide a period of not less than 30 days from the date the notice is delivered or mailed within which the Borrower must pay all sums secured by this K.,cufx,.s~t~+,a~,r~r,.~oocsor~vn+~,, 7 o f 13 • • Security Instrument. If Borrower fails to pay these sums prior to the expiration of this period, Lender may invoke any remedies permitted by this Security Instrument without further notice or demand on Borrower. 17. Borrower's Right to Reinstate. If Borrower meets certain conditions, Borrower shall have the right to have enforcement of this Security Instrument discontinued at ant time prior to the earlier of: (l) 5 days before the sale of the Property pursuant to any power of sale contained in this Security Instrument; or (b).entry of a judgement enforcing this Security Instrument. Those conditions are that Borrower: (a) pays Lender all sums which then would be due under this Security Instrument and the Promissory Note as if no acceleration had occurred; (b) cures any default of any other covenants or agreements; (c) pays all expenses incurred in enforcing this Security Instrument, including, but not limited to reasonable attorney's fees; and (d) takes such action as Lender may reasonably .require to assure that the lien of this Security Instrument, Lender's rights in the Property and Borrower's obligation to pay the sums secured by this Security Instrument shall continue unchanged. Upon reinstatement by Borrower, this Security instrument and the obligations secured hereby shall remain fully effective as if no acceleration had occurred. However, this right to reinstate shall. not apply in the case of acceleration under Section 16. Notwithstanding, Lender's right to invoke any remedies hereunder, as provided in Section 7 above, Lender agrees that it will not commence foreclosure proceedings or accept a deed in lieu of foreclosure, or exercise any other rights or remedies hereunder until it has given the Senior Lien Holder at least 60 days prior written notice. The Borrower and the Lender agree that whenever the Promissory Note or this Security Instrument gives the Lender the right to approve or consent with respect to any matter affecting the Property or otherwise, and a right of approval or consent with regard to the same. matter is also granted to the Senior Lien Holder pursuant to the First Deed of Trust, the Senior Lien Holder's approval or consent or failure to approve or consent, as the case may be, shall be binding on the Borrower and the Lender. t 8. Sale of Note; Change of Loan Servicer. The Promissory Note or a partial interest in the Promissory Note (together with this Security Instrument) may be sold one or more times without prior notice to the Borrower. A sale may result. in a change in the entity (known as the "Loan servicer") that may collect monthly payments under the Promissory Note and Security instrument. There also may be one or more changes of the Loan Servicer unrelated to a sale of the Promissory Note. If there is a change in the Loan Servicer, Borrower will be given written notice of the change in accordance with Section. l 3 above and applicable law. The notice will state the name and address of the new Loan Servicer and the address to which- payments, if any, should be made. The notice will also contain any other information required by applicable law. 19. No Assignment. Until the loan secured by the First Deed of Trust has been satisfied in full, Lender and the Borrower agree that the Promissory Note and the Security Instrument will not be assigned without the Senior Lien Holder's prior written consent. K.,~„~ ,~, 8 o f 13 • • 20. Hazardous Substances. Borrower shalt not cause or permit the presence, use, disposal, storage, or release of any Hazardous Substances on or in the Property. Borrower shall not do, not allow any one else to do, anything affecting the Property that is in violation of any Environmental Law. The preceding two sentences shall nor apply to the presence use, or storage on the Property of small quantities of Hazardous Substances that are generally recognized to be appropriate to normal residential uses and to maintenance of the Property. Borrower shall promptly give Lender written notice of any investigation, claim, demand, lawsuit or other action by any governmental or regulatory agency or private party involving the Property and any Hazardous Substance or Environmental Law of which Borrower has actual knowledge. If Borrower learns, or is notified by any governmental or regulatory authority, that any + removal or other remediation of .any Hazardous Substance affecting the Property is necessary, Borrower shall promptly take all necessary remedial actions in accordance with £nvironmental Law. Prior to taking any such remedial action, however,. Borrower shall notify the Lender that such remedial action is necessary and shall obtain the Lender's prior written consent for such remedial action. As used in this Section, "Hazardous Substances" are those substances defined as toxic or hazardous substances by Environmental law and the following substances: gasoline, kerosene, other flammable or toxic petroleum products, toxic pesticides and herbicides,. volatile solvents, materials containing asbestos or formaldehyde, and radioactive materials. As used in this Section, "Environmental Law" means federal laws and the laws of the jurisdiction where the Property is located that relates to health,. safety and environmental protection. NON-UNIFORM COVENANTS. Borrower and Lender further covenant and agree as follows: 21. Acceleration; Remedies. Upon Borrower's breach of any covenant or agreement of Borrower in this Deed of Trust, including the covenants to pay when due any sums secured by this Security Instrument, Lender prior to acceleration shall give notice to Borrower as provided in Section 13 hereof specifying. (1) the breach; (2) the action required to cure such breach; (3) a date, not less than 30 days from the date of .notice is mailed to Borrower (and with respect to the Senior Lien Holder, 60 days from the date the notice is given to the Senior Lien Holder), by which such breach must be cured; and (4) that failure to cure such breach on or before the. date specified in the notice may result in acceleration of the sums secured by this Security Instrument and sale of the Property., The notice shall further inform Borrower of the right to reinstate after acceleration and the right to bring a court action, to assert the nonexistence of a default or any other defense of Borrower to acceleration and sale. If the breach is not cured on or before the date specified in the notice, and the Senior Lien Holder has not exerased its right to cure the breach, then Lender, at Lender's option, may dedare all of the sums secured by this Security Instrument to be immediately due and payable without further demand and may invoke the power of sale and acceleration of the sums secured by this Security Instrument and sale of the Property. K•.,cuQVrs~+,avr~r~,oc~sw~m.,vEU, 9 0 f 13 • Notwithstanding Lender's right to invoke any remedies hereunder, the Lender agrees that it will not commence foreclosure proceedings or accept a deed in lieu of foreclosure, or exercise any other rights or remedies hereunder until it has given the Senior Lien Holder at least 60 days prior written notice. Lender shall be entitled to collect all expenses incurred in pursuing the remedies including, but _not limited to, reasonable attorney's fees and costs of title evidence. If Lender invokes the power of sale, Lender shall execute or cause Trustee to execute a written notice of the occurrence of an event of default and of Lender's election to cause the Property to be sold and shall cause such notice to be recorded in each county in which the Property or some part thereof is located. Lender or Trustee shall mail copies of such notice in the manner prescribed by applicable law. Trustee shall give public notice of sale to the persons and in the manner prescribed by applicable law. After the lapse of such time as may be required by applicable law, Trustee, without demand on Borrower, shall sell the Property at public auction to the highest bidder at the time and place and under the terms designated in the notice of sale in one or more parcels and in such order as trustee may determine. Trustee may postpone sale of all or any parcel of the Property by public announcement at the time and place of any previously scheduled sale. Lender or Lender's designee may purchase the Property at any sale. Trustee shall. deliver to the purchase Trustee's deed conveying the Property so sold without any covenant or warranty, expressed or implied. The recitals in the trustee's deed shall be prima facie evidence of the truth of the statements made therein. Trustee shall apply the proceeds of the sale in the following order: (a) to all reasonable costs and expenses of the sale,. including, but not limited to, reasonable Trustee's and attorneys' fees and costs of title evidence; (b) to all sums secured by this Security Instrument; and (c) the excess, if any, to the person or persons legally entitled thereto. 22. Assignment of Rents; Appointment of .Receiver; Lender in Possession. As additional security hereunder, Borrower hereby assigns to Lender the rents of the Property, provided that Borrower shall, prior to acceleration or abandonment of the Property, have the right to collect and retain such rents as they become due and payable. Upon acceleration hereof or abandonment of the property, Lender, in person, by agent or by ,judicially appointed receiver shall be entitled to enter upon, take possession of and manage the Property and to collect the rents of the Property including those past due. All rents collected by Lender or the receiver shall be applied first to premiums on receiver's bonds and reasonable attorneys' fees, and -then to the sums secured by this Security Instrument. Lender and the receiver shall be eligible to account only for those rents actually received. 23. Reconveyance. Upon payment of all sums secured by this Security Instrument, Lender shall request Trustee to reconvey the Property and shall surrender this Security instrument and all notes evidencing indebtedness secured by this Security instrument to the Trustee. Trustee shall reconvey the Property without warranty and without charge to the person or persons legally entitled thereto. Such person or persons shall pay all costs of recordation, if any. K.,a,~.s~+,a„rr~r,~,oocs~~,v 10 0 f 13 ~~ M ,, 24. Substitute Trustee. Lender, at Lender's option, may from time to time appoint a successor Trustee to any Trustee appointed hereunder by an instrument executed and acknowledged by Lender and recorded in the office of the recorder of the county where the Property is located. The instrument shall contain the name of the original Lender, Trustee and Borrower, the book and page where this Instrument is recorded and the name and address of the successor trustee. The successor trustee shall, without conveyance of the Property, succeed to all the title, powers and duties conferred upon the Trustee herein and by applicable law. This procedure for substitution of trustee shall govern to the exclusion of all other provisions for substitution. 25. Modification of First Deed of Trust Loan Documents. The .Lender consents to any agreement or arrangement in which the Senior Lien Holder waives, postpones, extends, reduces or modifies any provisions of the First Deed of trust Documents,. including provisions requiring the payment of money. BY SIGNING BELOW, The Borrower and the Lender accept and agree to the terms and covenants contained in this Security Instrument. BORROWER - DATE OF SIGNATURE BORROWER - BORROWER - SIGNATURES MUST BE NOTARIZED K. • 1 C! J E] Y J' S l fZ M G N? E l F T f B ~ D 0 G S l D FAD J V E 1 V DATE OF SIGNATURE DATE OF SIGNATURE 11 ofi 13 • REQUEST FOR RECONVEYANCE TO TRUSTEE: The undersigned is the holder of the note or notes secured by this Security instrument - (Deed of Trust). Said Promissory note or notes, together with all other indebtedness secured by this Security instrument (Deed of Trust), have been paid in full. You are hereby directed to cancel said Promissory .note or notes and this Security instrument (Deed of Trust), which are delivered hereby, and to reconvey, without warranty, all the estate now held by you under this Deed of Trust to the person or persons legally entitled thereto, Dated:.. AUIHORlZF.D SIG~YATURE NAMEPR/A?F~ OR TYPED 12 of 13 • Exhibit A TO THE DEED OF TRUST (CITY OF LYNWOOD FIRST-TIME HOMEBUYER PROGRAM) K. • 1 CL /E7 V T S~ f f G N? E ~ f~ T f B W~ S l D ®. N E ti V 1.3 of 13 PROMISSORY NOTE j„wn~ wnnr~, C'alifnrnia Qn2(i(1 . Lynwood, California 90260 Property Address City State Zip Code ,-- -. -~ x - ~~ ,~ `.J BORROWER(S) PROMISE TO REPAY ~ ~ ~ ~ ~ ~`~ Iv ~ ~ .FOR VALUE RECEIVED, the undersigned, ,hereafter called "Borrower(s)," hereby jointly and severally promise to pay to CITY OF LYNWOOD, CObftVIUNITY DEVELOPMENT DEPARTMENT a public body, hereafter called "Lender, ° or to Lender's order, the sum total of (Principal) at such place as Lender may designate, in lawful money of the United States of America as hereafter set forth. . 1. DEFINITIONS. The following definitions shall apply throughout this Note: (A) Pro~~. The real property described in Exhibit A attached to this Note and made a part of hereof. (B) Sale or .Transfer. Any sale, transfer, lease, cash out refinance or family trust transfer, of any part of the Property will permit Lender to exercise a due on sale clause. (C) Deferred Loan Amount. Principal Sum of the Promissory Note. (D) Promissory Note. Herein referred to as "Note". (E) Senior Lien Holder. Actual holder of first deed of trust is herein referred to as the "Senior Lender" . (F) Princ' al Balance. Amount of loan funds due less any forgiveness. TERMS 1. INTEREST. This note does not bear interest. 1 of 4 f 2. TIME OF PAYMENT. This Note is due on sale, transfer, lease, cash out refinance or family trust transfer of any part of the Property and/or when Borrower ceases to reside in the property. 3. AMOUNT OF PAYMENT.. If and when this Note becomes due pursuant to Section 2. above, Borrower shall pay to Lender the outstanding Principal balance of the original loan. amounts. Said principal balance shall be forgiven over the' term of the Note (20 years), at a rate of 5 % each year for twenty years. Forgiveness shall be posted by -the lender on a yearly basis, beginning one year from the date of execution of this Note. 4. PREPAYMENT. Borrower shall have the right at any time to repay this Note. In the .event of prepayment, the amount payable in full by Borrower shall be the principal balance on the deferred/forgivable loan schedule and any other unsecured amounts owing. 5. ASSUMABILITY. This Note is assumable if the subsequent purchaser of the real property is an eligible low-income household as specified under the Terms and Conditions of the City . of Lynwood's First-Time Homebuyers Program. and has received prior approval from the Lender. . 6. ~.ECURITY. This Note is secured by a Subordinate Deed of Trust. 7. pEFAULT UNDER DEED OF TRUST. Notwithstanding any other provisions of this Note, if default occurs in any of the covenants or agreements contained in the Deed of Trust securing this Note, this Note shall immediately become due and payable in full at the option. of Lender. In the event Lender exercises such option, the amount due .and payable shall be the Deferred Loan Amount. Failure by Lender to exercise its option to accelerate in the event of a default shall not constitute waiver of the right to exercise such option in the event of the same or any other default. S. JOINT AND SEVERAL. The undersigned, if more than one, shall be jointly and severally liable hereunder. 9. ATTORNEYS FEES: If any default is made hereunder, Borrower further promises to pay reasonable attorney fees and costs and expenses incurred by the .Lender in connection with ..any such default or .any other action or other proceeding brought to enforce any of the provisions of this Note. The Lender's right to such fees shall not be limited to or by its representation by staff counsel, and such representation shall be valued at customary and . reasonable rates. for private sector legal services. 10. ~. Time is of the essence herein. 2 of 4 ~ ~ which writing must be so firmly attached to this promissory note so as to become a permanent part thereof. 12. SEVERABILITY. The covenants of this promissory note are severable. Invalidation of any covenant or any part thereof by law, judgement, or court order shall not affect any other covenant. 13. PLACE OF REPAYMENT. Borrower will make payment of all amounts due to Lender under this Note to Lender at 11330 Bullis Road, Lynwood. CA 90262 or such other address as Lender may designate in writing to Borrower. 14. BORROWER'S WAIVERS. Borrower waives any rights to require the Lender to do certain things. Those things are: (A) to demand payment of amounts due (known as "presentment"); (B) to give notice that amounts due have not been paid (lmow as "notice of dishonor"); (C) to obtain an official certification of nonpayment (known as a "protest"). 15. GIVING OF NOTICES. Any notice that must be given to Borrower under this Note will be given by delivering it or by mailing it by certified mail addressed to Borrower at any Property Address above. Any notice that must be given to the Lender under this Note will be given by mailing it certified mail to the Lender at the address stated in Section 13 above. 16. LOAN AUTHORITY. The loan evidenced by this Note is being made pursuant to the HOME Investment Partnership Program and the regulations issued thereunder (Title II, the Cranston-Gonzales National Affordable Housing Act, Public Law No. 101-625, 104 Stat. 4079 (1990), 24 CFR Part 92.) 17. SUBORDINATION. The indebtedness evidenced by this Note, and any other financial obligations which may be imposed by the Lender are subordinate to the indebtedness evidenced by a promissory note payable to a Senior Lender, which note is secured by the first deed of trust on the Property. BY SIGNING BELOW, THE BORROWER(S) ACCEPT AND AGREE TO THE TERMS CONTAINED IN THIS PROMISSORY NOTE. BORROWER - DATE OF SIGNATURE BORROWER - K:\CLIEN'~,SU.YNWOOD\FrHB\DEED. NEW DATE OF SIGNATURE 3 of 4 Exhibit A to the NOTE SECURED BY DEED OF TRUST (CITY OF LYNWOOD' S FIRST-TIlVIE HOMEBUYER PROGRAM) Insert Legal Desc~tion of Property DO NOT REMOVE THIS PAGE (Insert Legal..Description by Pasting over this Boxed Section or Insert Immediately Following this Page) 4 of 4 s . CONSENT CALENDAR • «. CITY COUNCIL AGEND A ,~ City !tanager ~ s Approval DEPARTMENT CITY CLERK'S OFFICE DATE i DECEMBER 15, 1998 SUBJECT ~ SPECIAL PERMIT CO~ ~+ ~8r 1 S -~ SPECIAL REQUEST FOR PARKING LOT SAL 12/18-20/98 E ON: 12/25-27/98 01 /1 -3/98 FROM 9:00 A.M. /8:00 FOR 3840 MARTING LUTHER KING BLVD. AVI ZAFRANI (BROADWAY FACTORY OUTLET RECON[MENDATIQN • THAT COUNCIL {REVIEW • AND APPROVE THE SPECIAL REQUESTED. agenda/public Aaaring • city o~ ~YN~OOD `e R ~~'~~ ~ City JlAeeting ChaQQenges 11330 BULLIS ROAD LYNWOOD, CALIFORNIA 90262 (310) 603-0220 PERMIT APPLICATION FOR PARKING LOT SALES ill-~M~ ~'If~) FEE: X30.00 PER DAY' f TYPE OF BIISINESS ~ri ~l~l BUSINESS NAME ~~~-Q~y ~~CT•~~ ~ L LOCATION OF S ALES 3P'f'a ~ ~~~'~ ~~A~~1 ~'A~t h ~is~ ®. DATE (S) OF SALE 0/ ~ j ""~ r ~ A~ _ . APPLICANT'S NAME ~/ ~ HOME ADDRESS 3 ~~ ~ /'r•1~/~~a/ ~ !~ k 1-,~ip ~~~ ~ ld-~ o ~~~ CITY ~~woo f/ ZIP ~~~~. SS# ~~~ ~ ~~~q~DL#I~i~j~~ . Conditions IInder Which Permit is Approved: 1.) Written approval from property owner of parking lot. 2.) Permitee shall procure public liability and property insurance covering its operation in and about said premises in a minimum amount of one million dollars (1,000,000) in the aggregate for combined single limit bodily injury and/or property damage, including products liability. The City of Lynwood shall be named as an additional insured on such insurance. The permitee shall file a certificate of insurance within seven (7) days after the issuance of the permit,, and prior to the effective date of of the permit. 3.) Permitee guarantees cleanup after the sale. 4.) Permitee agrees that there shall be public acces o at ast four (4) feet. ~{I~ D ~~-~~ 5.) Permitee agrees that there shall (Jl ,/`a'wnings or shelters erected. ._ Signature Date ~dt/ jt/~ r: Permit number --, ,, ~ <iPE OF PERJKIT DESIRED ~~ DATE (S) OF EBERT~ ~ ~rrLlceTloP Fog SPECIAL PE>a>t~~ ~aK~/~ . LdT .SALE OODBS OF IIS8 ~~~~~ S~ ~y ~ ~ ~,~.i. ADDRESS QaFJtE PERMIT IS DESIBED ~~Q /~ ARTei/ `k r~~ K ~ ~/~ rTit. eREA DESIGi~ATF.D Fog EvEAr ~~R Kris Ld ~ S~AI,E ~~/ T M~ ~~~~ I$ STREET CLOSURE BEING BFQDESTED YES PO circle one) {if yes, briefly ezplain reason for event closare) IF I1~IDOORS , APPROZ. TOTAL GBODI~ID-FLOGS ABF.A OF STHIIC!'QBE HAVE YOU MADE AN APPLICATION FOR THIS TYPE OF PIItMIT BEFORE? y~s If so, Hhere? ` ~j//~j ~ Q . APPLICANT (S) NAME ~ ~~ ~f~ A i/~ . ~ PgogE (3 I O) ~• ~~~ APPLICANT (S) ADDRESS ~ / ~ /N A~T lr LLLT ~~ rirL~TY (~yi///i.~r z~ APPLICANT (S) OCCOPATION ~N~~g` /N/~/jr~ NIIMBER OF PERSONS P1~LOYED ~D SBE# (State Board of Equalization) IS A WAIVER OF FEES BEING REQUESTED YES AO (circle one) (if yes, briefly explain reason for request I hereby certify that all statements made in this application are true and complete, and that any misstatements of material facts will cause a forfeiture of ees and denial of permit. ~~ Signatur p icaat Date . Signature of Agent (if any) Date COIINCIL/APPROVED/DENIED DATE ~ City c~ ~Yl~~Q®D ~.~, ~ C~,~ ~~ ~ Ctty ulAeettng (,'fwQQenges 11330 BULLIS ROAD LYNWOOD, CALIFORNIA 90262 (310) 603-0220 i ;~ aka ;i ~: CITY nF i.~nn~~C7~i i i CiTY CLLi ,. ,., L i=iC~t GEC ~ . i>: AM PH 7~8i9~10~ilil2ili2~8~4i5i6 . ~+. a_ . ,,wY _. ~~ ~":` ~` - APPLIC,ATIOR FOB „ ~- - . '' - TYPE OF PBIisKZIT DESIRED ~ R K / ~~ ~,~ T S q L DATE (S) OF EVERT ~~_ ~___DDORS OF OSE ~ ` '~ '~~ ADDRESS WHERE PERtQT IS DESIRED 3 ~hO M A~Tri',~/ IQ i~L rIP• ~L=~ • AREA DESIGNATED FOR EVERT /~ R ~ ING I rT O/ rA~ E ~~R/~is~c I~ STREET CLOSIIRE BEING BEQIIESTED YES (circle one) (if yes, briefly explain reason for event closure) IF ZIIDOORS, APPROZ. TOTAL GBOOI~ID--FLOOR ABEA OF STRIICPQRE ~/ HAVE YOU !LADE AN APPLICATION FOR ISIS TYPE OF PERKIT BEFORE? / ~s If so, Where? L ~/~/j/rr • APPLICANT (S) RAKE A t/ ~' - 2_/1 ~~/~/ ' ~ ~ ~ ( 3' ~) ~~ ~ S~icf> APPLICANT(s) eDDRESS ~ {Gjd f~/~~TiJ/LKToI~ i~/G ~~CITY ~i~l /M~~V~ zIP ~~~. APPLICANT (S) OCCUPATION G~//6~Ait~ /~II'~~~il{. NIIl03ER OP PERSONS EI~LOYF.D ~D SBE# (State Bosrd of Equalization) IS A WAIVER OF FEES BEING REQIIESTED YES PO (circle oae) (if yes, briefly ezplain reason for reques ) I hereby certify that all statements >.ade any misstatements of material facts will in this application are true and complete, and tha~l cause a forfeiture of fees and denial of per~i.t. I igna o - Appli t at ~ i Signature of Agent (if any) Date COUNCIL/APPROVED/DENIED DATE ~t city of ~~1~~OOD ~~ ~~ v4 Ctty ~/Ueettng CkaQQenges 11330 BULLIS ROAD LYNWOOD, CALIFORNIA 90262 (310) 803-0220 ;~ a;.a. :~ ,. ~ LL CITY nF ~_~nn~inC.~ i CiT~ CL_~..._: C, " r.~: t i ~i~~ J IS AM PNi 7s8~9~~~~e~~~e2e~~4i5~f {~, ~ ~ `' ~ [3Q?~,~DWi~Y F,ACT~I~Y ~UTCET, INC. 3840 Martin Luther King Jr. Blvd. Lynwood, California 90262 Phone: (310) 608-2157 •~ Fax: (310) 608-2584 December 15,1998 Dear Council Members, At the request of Mr. Eli Sasson we would like to conduct a parking lot sale from now to January 10,1999. Since the tent is already installed and approved and we fear the fact 39 . Employees from the City of Lynwood will leave us for the reason that we can only offer them A weekend job, which we would .like to extend to afull-time job (based on the approval given by the City of Lynwood). We would like to ask for permission to conduct the parking lot sale based on the performance, and the fact that we have abide with all rules and regulations for a parking lot sale. We appreciate your time and effort in trying to help our employees and us as well. Sincerely, Avi Zafrani ~~ r; ~-. ~. .~ ;,a ~ ~ `~ s ~x m ~ ~£ Lynwood Latino Coalition To: Mr. Jim Given, Director Recreation & Parks CITY OF LYNWOOD CITY CLERKS OFFICE DEC 1 ~. 99Q~ Re: Street Closure A~ pig 7e~s9iB~'~11`t'li2'314'Si6 December 14,1998 Dear Mr. Given, Lynwood Latino Coalition, Block Watch Captain, and Residents of 3100 Block of Norton Ave. request permission to close Norton Ave. between State St. and Barlow. Closure would be for one (1) day only, December 18,1998, between the hours of 6:00 p.m. and 11:00 p.m. We would also need about twenty (20) chairs and two (2) tables. Thank you for your prompt attention with this matter. Respectfully, ~. ~~ wrence,,,,/Ma s, ~y'GS~d~i1 ~' ~ ~°~. P.O. Box #72, Lynwood, California 90262-0072 l~.y ~Yd ~~,~~ i~ ,:: ;;` °:i .~,;~ -. ,r~ TYPE JF PSBlIIT DESIRED -, >;~ ;3 ~~i ::; tJ ::, ;, APPLICATIOR FOB SPECIAL PBR~IIT DATE(S) OF EVENT ~~,, _o_.y.~ei~ ~~ ~J`J~~S ~DBS OF DSB ~-00 yr! 7b /~~~D P~°s ADDRESS flHERE PERMIT IS DESIRED 316~d j3/©c k d, 7'~ ~c~vr~B,r/~jl vc :. IP INDOORS, APPROZ. TOTAL GRODI®-FL008 ABEA OF STRIIGZORE HAVE YOD !LADE AR APPLICATIOR FOR THIS TYPE OF PEBl~IT BEFORE?~ If so, iihere? _.---ter APPLICANT(S) HeME .il~r~/-ar.~~ d~.r~.~rf PH01~E(~/U ) ~~i. ~ 49S'"3 APPLICANT(S) ADDRESS f~~y ~~~ri,s' /~yc CITY ~~~gip~0~; Z APPLICANT(S) OCCQPATION Ul P~f'ii'Gr~ NIIIiBER OP PERSONS PlIPIAYED_ - ~~ SBE# (State Board of Equalization) IS A WAIVER OF FEES BEING REQDESTED -~ S (if yes, brief! ~ (circle one) y explain reason for request) rcy j'c - I hereby certify that all statements made in this application are true and complete, and tbal any misstatements of material facts will cause a forfeiture of fees and denial of permit. COIINCIL/APPROVED/DENIED •• DATE ~, city ~ ~YN~OOD - ~.~ ~ ~ ~~~~~ c~ Ctty vUe¢t(ng CIwQQe~ges°'; ~', D 11330 BULLIS ROAD LYNWOOD, CALIFORNIA 80262 (310) 803-0220 AREA DESIGAATED F08 EVENT B~7~ii~cv ~a.>`c S~_ ~ ~4,~~~/ • I~ STREET CLOSQRE BEING BEQDE PO (circle one) (if yes, briefly explain reason .event and closure) - Signature of Agent (if any) Date