ORD 2285 - Laserfiche WebLink

a) In general, lending institutions require that funds must be seasoned (on deposit in a financial institution) for a minimum of three months prior to the initial date of the application with documentation showing these funds are available for use as down payment. b) Funds must be placed into escrow prior to close of escrow and proof of availability of funds provided to the City's Program Agent before close of escrow. 17. Buyers purchasing homes through the PHAP Program may use forms of secondary down payment financing from the City -approved subsidy sources. 18. The City will not provide any direct financing, and buyers must qualify independently for mortgage financing to purchase the homes. However, buyers may apply separately for second mortgage assistance through the Pleasanton Down Payment Assistance Loan (PDALP) program. Review of the PDALP application will be conducted separately from consideration of the Eligibility and Financing Application. Approval of PDALP financing in conjunction with the PHAP program will be based on the applicant's demonstrated financial need. 19. Applicants may be gifted funds in an amount not to exceed 15% of the purchase price, plus closing costs as evidenced by a gift letter which must be submitted at the time of the PHAP application submittal. Restrictive Covenant Requirements 20. Applicants must agree to occupy the property as the principal place of residence for at least ten (10) months of each calendar year. The property and improvements must be maintained in good condition and repair throughout the period of ownership. The property and any part of it may not be subleased. 21. Applicants must agree to comply with the Restrictive Covenants recorded on the BMR home which, among other things, will restrict the sale of the home to other eligible age -qualified purchasers at a maximum resale price determined by the City in accordance with these guidelines. The Applicant shall execute a Promissory Note and Performance Deed of Trust to capture any Excess Proceeds received in the case of an ineligible transfer of the property. The Restrictive Covenants shall remain in perpetuity and the Note, and Performance Deed of Trust shall remain so long as Applicant owns the BMR home. 22. Applicants must agree to the City's subordination and refinancing conditions which generally prohibit the take out of equity or appreciation. Refinancing is limited to reduction of an interest rate or more favorable or lower payment terms. Only the existing balance of the loan may be refinanced and up to 2% for non-recurring closing costs. 23. The resale price will be based on adjustments (increases and decreases) in the Area Median Income (AMI) annually by U.S. Department of Housing and Urban Development (HUD). The formula for determining the maximum resale price shall also include an allowance for reasonable closing costs and marketing expenses as determined periodically by the City. 4 of 6