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HomeMy WebLinkAbout1984 099 CC RESO1984 099 CC RESO(Ììç»RESOLUTION NO. 54- 99 A RESOLUTION OF THE CITY OF BALDWIN PARK APPROVING RULES AND REGULATIONS RELATING TO ITS HOME MORTGAGE FINANCING PROGRAM RESOLVED, by the City of Baldwin Park, California as follows: WHEREAS/ Chapters 1-5 of Part 5 of Division 31 of the Health and Safety Code of the State of California herein called the Act") authorizes cities and counties to issue revenue bonds for the purpose of financing home mortgages authorized by the Act, and the Act provides a complete, additional and alternative methods for doing the things authorized thereby; and WHEREAS, alleviation of the shortage of affordable residential housing facilities and provisions of capital for investment in such facilities for low and moderate income families and persons within the incorporated area of the City constitutes a valid public purpose for the issuance of revenue bonds under the Act? and WHEREAS, the provisions of applicable law require the City to adopt Rules and Regulations in implementation of the City's Home Mortgage Financing Program. NOW, THEREFORE, IT IS HEREBY ORDERED that the Rules and Regulations attached hereto as Exhibit A" are hereby adopted and approved as the Rules and Regulations of the City of Baldwin Park relating to its Home Mortgage Financing Program. APPROVED AND ADOPTED this llth day of December, 1984. A^^^^ ATTEST-: / /^MAYCTR' r^HDA L. GM"R, CITY CLERK STATE OF CALIFORNIA COUNTY OF LOS ANGELES) ss. CITY OF BALDWIN PARK I, LINDA L. GAIR, City Clerk of the City of Baldwin Park do hereby certify that the foregoing Resolution was regularly approved and passed at an ADJOURNED REGULAR MEETING of the Baldwin Park City Council on the llth day of December, 1984 by the following vote: AYES: NOES: COUNCILMEN IZELL. GIBSON. KING. McNEILL AND MAYOR WHITE COUNCILMEN NONE ABSENT: COUNCILMEN NONE r^ c^ MNDA L. GAIR< CITY CLERK BIB] 37672-U01 1984-U02 099-U02 CC-U02 RESO-U02 LI3-U03 FO2126-U03 FO10091-U03 DO10100-U03 C6-U03 RESO-U03 2/20/2003-U04 ROBIN-U04 1984 099 CC RESO(Ììç»CITY OF BALDWIN PARK HOME MORTGAGE FINANCING PROGRAM RULES AND REGULATIONS ESTABLISHING ELIGIBILITY CRITERIA FOR MORTGAGORS AND FOR HOME MORTGAGES Adopted December 11, 1984) These Rules and Regulations are made pursuant to Chapters 1-5 of Part 5 of Division 31 of the Health and Safety Code of the State of California and Section 103A of the Internal Revenue Code of 1954, as amended, and relate to the City's Home Mortgage Financing Program of purchasing Home Mortgages, made to qualified persons and families, from Lenders, all as hereinafter defined. These Rules and Regulations establish criteria for the origination, servicing and administration of Home Mortgages under the Program. In developing the criteria, the City has considered, on a Citywide basis, factors such as the amount of personal or family income available for housing needs, household size, costs and condition of available housing, and eligibility of potential mortgagors for housing assistance. Section 1. Definitions. Unless the context otherwise requires, the terms defined in this section shall for all purposes of these Rules and Regulations have the meanings herein specified, to be equally applicable to both the singular and plural forms of any of the terms herein defined. Unless-otherwise defined, all terms used in these Rules and Regulations shall have the meanings assigned to such terms in the Act, the Tax Act or the Indenture. Act. Act" means Chapters 1-5 of Part 5 of Division 31 of the Health and Safety Code of the State of California, as now in effect or as hereafter amended. Authorized Officer. Authorized Officer" means any one of the officers or employees of the City authorized by resolution of the City to perform the act or sign the document in question. Bonds. Bonds" means any Bond or Bonds, as the case may be, of the City of Baldwin Park, California, authorized by and at any time outstanding pursuant to the Indenture. Commitment Contract. Commitment Contract" means a Commitment Contract and Reservation of Funds) between the City and a developer whereby the developer agrees to provide Home Mortgages for purchase by the Trustee on behalf of the City. City, City" means the City of Baldwin Park, California. Home. Home" means real property improved with a residential structure and located in one of the Projects as defined in the Commitment Contracts), or, with respect to Homes which have been previously occupied, located within the incorporated area of the City, the financing of which is or may hereafter be permitted under the Act and the Indenture. Home includes single-family attached or detached residential units, townhouse residential units and condominium residential units. Home Mortgage. Home Mortgage" means a loan made and executed for the purpose of financing residential construction or for the purpose of financing a Home which has been previously occupied, and secured by a Mortgage, the payment of which is insured by mortgage insurance as provided in the Act and the Indenture. BIB] 37672-U01 1984-U02 099-U02 CC-U02 RESO-U02 LI3-U03 FO2126-U03 FO10091-U03 DO10100-U03 C6-U03 RESO-U03 2/20/2003-U04 ROBIN-U04 1984 099 CC RESO(Ììç»Home Mortgage Application. The term Home Mortgage Application" shall mean a Mortgagor's application for a Home Mortgage under the Program. Home Mortgage Purchase Agreement. Home Mortgage Purchase Agreement" shall mean an agreement by and among the City, the Trustee and a Lender providing for the origination and purchase of Home Mortgages by the Trustee on behalf of the City. Household Income. Household Income" means the current gross income as calculated by the Lender for purposes of qualifying a Mortgagor for a Home Mortgage, together with the gross income of all persons 21 years of age or older who intend to reside permanently with such Mortgagor in the Home being financed under the Program, regardless of whether such persons resided with such Mortgagor at any time in the past. Indenture. The term Indenture" means the Trust Indenture dated as of December 1, 1984, concerning the Bonds between the City and the Trustee, and as it may from time to time be amended in accordance with its terms. Lender. The term Lender" or Lenders" shall mean any state or national bank or trust company, savings and loan association, or mortgage banker authorized to acquire, hold and deal in mortgages and is a FNMA or FHLMC approved seller/servicer of mortgages. Such Lender shall have a place of business in the State, shall be authorized to do business in the State, shall be authorized by the City to do business with the City and to aid in financing Home Mortgages pursuant to the Act on behalf of the City. Median Household Income. Median Household Income" shall mean the highest of i) statewide median household income, ii) countywide median household income, or iii) median family income for the area as determined by the United States Department of Housing and Urban Development, as such median household income is established and adjusted from time to time by the City. Mortgage. The term Mortgage" shall mean a deed of trust or other instrument which constitutes a first lien subject to Permitted Encumbrances) on real property or a leasehold interest therein and improvements thereon, together with a promissory note or similar interest bearing obligation made by a Mortgagor, the repayment of which is secured by a lien on real property located within the City and improved by a Home financed with the proceeds of the Bonds, Mortgagor. The term Mortgagor" shall mean the maker of, and any other Person obligated on, a note in connection with the acquisition of a Home through the borrowing of money pursuant to a Home Mortgage and who i) meets the income limitations of the Indenture and the Act, ii) except with respect to the unrestricted 10% of the Developer's Reservation under and as defined in the Commitment Contracts, or with respect to a Home located in a Targeted Area as defined in the Indenture) had a present ownership in a principal residence of such Person at no time during the 3-year period ending on the date of execution of the applicable Mortgage as provided in the Indenture and the Tax Act, and iii) otherwise meets the requirements of the Act, the Tax Act, the Indenture and the Program. The term Mortgagor" shall also include a subsequent purchaser of a Home who assumes the related Home Mortgage and who meets the requirements of the Act, the Tax Act and the Program. The term Mortgagor" does not include any person who signs a note evidencing a Home Mortgage and who executes and files with the Lender a statement under penalty of perjury or an affidavit that i) he is executing the note solely for purposes of additional security to the Lender, ii) he has no other financial interest in the property subject to the Home Mortgage, and iii) he has no intention to and will not occupy the premises subject to the Home Mortgage at any time. 2- BIB] 37672-U01 1984-U02 099-U02 CC-U02 RESO-U02 LI3-U03 FO2126-U03 FO10091-U03 DO10100-U03 C6-U03 RESO-U03 2/20/2003-U04 ROBIN-U04 1984 099 CC RESO(Ììç»Person. The term Person" shall mean any individual, partnership, co-partnership, firm, company, corporation, lending institution, association, joint stock company, trust, estate, political, subdivision, state agency or any other legal entity, or its legal respresentatives, agents, or assigns. Program. The term Program" shall mean the City's Home Mortgage Financing Program of purchasing Home Mortgages pursuant to the Indenture, the Act, the Tax Act and the Resolution of the City establishing and implementing the Program, and these Rules and Regulations. Rules and Regulations. Rules and Regulations" means these rules and regulations concerning the operation of the Program, or as they may be supplemented or amended from time to time. Servicing Agreement. Servicing Agreement" means a contractual agreement by and among the City, the Trustee and a Lender for the servicing of Home Mortgages by the Lender. State. The term State" shall mean the State of California. Tax Act. The term Tax Act" shall mean Section 103A of the Internal Revenue Code of 1954, as amended, and the regulations promulgated thereunder. Trustee. The term Trustee" shall mean the party who is referred to as the Trustee in the Indenture. Section 2. Eligibility Criteria for Mortgagors. A person that complies with the criteria hereinafter set forth in this Section is deemed by the City to be a person or family of low or moderate income and unable to pay the amounts at which unassisted private enterprise is providing suitable, decent, safe and sanitary housing and shall be eligible to become a Mortgagor under the Program To be eligibile as a Mortgagor, a Person must i) qualify as a Mortgagor under the requirements set forth in the Indenture, ii) execute the Mortgagor's Affidavit in form set forth as an Exhibit to the Home Mortgage Purchase Agreement, iii) meet the income limitations set forth in the Indenture, and iv) meet the under- writing requirements of the Lender and the private mortgage insurer for the Program. Section 3. Administration, Origination and Servicing Guidelines. The administration, origination and servicing guide- lines set forth in the Indenture, the Commitment Contracts, the Home Mortgage Purchase Agreements and the Servicing Agreements, respectively, and by this reference made a part hereof, shall be adhered to by the City, the Trustee, and the Lenders in performing their obligations in connection with the Program. Section 4. Special Rules Applicable to Reservations Pursuant to the Commitment Contracts. A) The Tax Act permits a portion of the Bonds to be applied to the purchase of Home Mortgages with respect to which Mortgagors had a Present Ownership Interest as defined in the Commitment Contracts) within the three-year period prior to the execution of the Home Mortgages. Accordingly, the Trustee may from time to time purchase Home Mortgages with respect to which a Mortgagor had such a Present Ownership Interest; but any such purchase may be made only if, at the time of such purchase, the aggregate original principal amount of all Home Mortgages thereto- fore and thereunder purchased under a Commitment Contract with respect to which the Mortgagors had such a Present Ownership does not exceed ten percent 10%) of the aggregate original principal amount of all Home Mortgages theretofore and thereupon purchased by the Trustee pursuant to the applicable Commitment Contract, excluding 3- BIB] 37672-U01 1984-U02 099-U02 CC-U02 RESO-U02 LI3-U03 FO2126-U03 FO10091-U03 DO10100-U03 C6-U03 RESO-U03 2/20/2003-U04 ROBIN-U04 1984 099 CC RESO(Ììç»from the principal amount of Home Mortgages, the principal amount of any Home Mortgages made within Targeted Areas" as that term is defined in the Indenture). B) The fact that a Mortgagor had a Present Ownership Interest shall not disqualify such Mortgagor from purchasing a Home in a Targeted Area" as such term is defined in the Indenture). Section 5, Median Houshold Income. For purposes of Home Mortgages made under the Program, Median Household Income is $28,800. The City reserves the right to adjust the Median Household Income from time to time in accordance with the authorization therefor contained in the Act. Section 6. Acquisition Cost. For purposes of the Program, Acquisition Cost" means the cost of acquiring a Home from the developer or other seller as a completed residential unit. Acquisition Cost" includes all amounts paid, either in cash or in kind, by the Mortgagor or a related party for the benefit of the Mortgagor) to the developer or other seller or a related party for the benefit of the developer or other seller) as consideration for the Home. If the Home is purchased subject to a ground lease then the term Acquisition Cost" includes the capitalized value of any ground rent payable with respect thereto, If a Home is incomplete, the term Acquisition Cost" includes the reasonable cost of completing the Home whether or not the cost of completing construction is to be financed with Bond proceeds. For example, where a Mortgagor purchases a building which is so incomplete that occupancy of the building is not permitted under local law, the term Acquisition Cost" includes the cost of completing the building so that occupancy of the building is permitted. As a further example, where a Mortgagor agrees to purchase fixtures at a separate price from the seller or otherwise, the term Acquisition Cost" includes the price paid for such fixtures. The term Acquisition Cost" does not include usual and reasonable settlement or financing costs. Settlement costs" include titling and transfer costs, title insurance, survey fees, and other similar costs, Financing costs" include credit reference fees, legal fees, appraisal expenses, points" which are paid by the buyer but not the seller even though borne by the buyer through a higher purchase price) or other costs of financing the Home. However, settlement costs and financing costs are excluded in determining Acquisition Cost only to the extent that such amounts do not exceed the usual and reasonable costs which would be paid by the buyer where financing is not provided through the Bonds. For example, if the purchaser agrees to pay to the seller more than a pro rata share of property taxes, such excess shall be treated as part of Acquisition Cost of a Home. In addition, if the purchaser agrees to pay to the seller an amount sufficient to pay outstanding assessment liens, such payment shall be treated as part of Acquisition Cost of a Home. The term Acquisition Cost" also does not include the value of services performed by the mortgagor or members of the mortgagor's family in completing the Home. Section 7» Maximum Acquisition Cost. Based on average area purchase prices published by the United States Department of the Treasury for the Los Angeles-Long Beach Primary Metropolitan Statistical Area, the maximum Acquisition Cost for Homes for purposes of the Program is $141,350 with respect to Home Mortgages for newly constructed Homes and $154,110 with respect to Home Mortgages for existing Homes, subject in all cases to adjustment from time to time, in accordance with the Indenture, the Tax Act and the affordability goals of the Program. Section 8 * Program Implementation. the Program will be made for the City by i Decisions concerning staff. It will be the 4- BIB] 37672-U01 1984-U02 099-U02 CC-U02 RESO-U02 LI3-U03 FO2126-U03 FO10091-U03 DO10100-U03 C6-U03 RESO-U03 2/20/2003-U04 ROBIN-U04 1984 099 CC RESO(Ììç»policy of the City to investigate the facts and circumstances surrounding any requests for actions or approvals by the City and to discuss the requested actions or approvals with the person or persons making such requests and, if the staff deems it desirable or it is required by the Indenture, with the Trustee. In all instances, the City will act with due regard for the security of the Bonds issued in connection with the Program, the City's goals for the Program and the terms and conditions of the Indenture and these Rules and Regulations. Section 9. Amendments. These Rules and Regulations may be modified or amended in accordance with the provisions hereof. Copies of all such modifications or amendments shall be transmitted to each of the Lenders, the developer who have entered into Commitment Contracts and the Trustee. Section 10. Miscellaneous. A) iver. To the extent permitted by the Act and the Tax Act, the City shall have the right to waive any rule or regulation herein contained, and any failure on the part of the City to enforce any rule or regulation herein shall not affect the validity of any contract entered into pursuant to the Program. B) Governing Law. All questions with respect to the construction of these Rules and Regulations shall be governed by the laws of the State. C) Section Headings. The headings of the several sections of these Rules and Regulations shall be solely for convenience of reference and shall not affect the meaning, construction or effect hereof. D) Severability. If any one or more of the provisions contained in these Rules and Regulations shall for any reason be held to be invalid, illegal or unenforceable in any respect, then such provision or provisions shall be deemed severable from the remaining provisions hereof and such invalidity, illegality or enforceability shall not affect any other provision hereof, and these Rules and Regulations shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein. 5- BIB] 37672-U01 1984-U02 099-U02 CC-U02 RESO-U02 LI3-U03 FO2126-U03 FO10091-U03 DO10100-U03 C6-U03 RESO-U03 2/20/2003-U04 ROBIN-U04