Res 2009-074 - Laserfiche WebLink

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of twenty percent (20%) for each full year the buyer resides in the home calculated using the date of closing as the anniversary date. The homebuyer must execute a promissory note and a deed of trust lien in favor of the City of San Marcos. The loan will be filed as a second position mortgage lien. In any case, the minimum amount of assistance, which may be provided to any buyer, shall be $1,000.00. The minimum buyer investment will be $800.00, which can be applied to items not payable by the FTH. The buyer will also be responsible for all other costs above the maximum FTH limits. 3. PERIOD OF AFFORDABILITY, PAYMENTS & RECAPTURE PROVISIONS A. The buyer must maintain, own and occupy the home as his or her principal place of residency for a minimum period of five (5) years after the purchase date (affordability period). Failure to occupy the property as the participant's principal residence and/or defaults in payments on the first mortgage, property taxes and/or hazard insurance constitute a default and may result in foreclosure. B. No interest will be charged on the deferred principal unless there is a Default as defined in the Real Estate Lien Note. During the continuance of any Default, the Deferred Principal (unforgiven balance) shall bear interest at a rate of six percent (6%) per annum. C. No payment will accrue or be payable during the affordability period. The Note will mature and become finally due and payable upon the expiration of the Affordability Period, provided, however, that if no Default has occurred which remains uncured, the amount of the Deferred Principal will be forgiven at the expiration of the Affordability Period. D. In the event of any Default, the Deferred Principal will be immediately due and payable. E. In the event of first lien payoff, refinancing, issuance of a home equity loan, or transfer of title, the Deferred Principal will be immediately due and payable. F. If the assisted property is sold before the end of the affordability period, recapture provisions will apply. FTH assistance must be recaptured out of the net proceeds. "Net proceeds" means the sales price minus pay-off of primary mortgage lien and seller closing costs. FTH assistance to be recaptured will be prorated based on the number of whole years the homeowner has owned and occupied the home. The amount subject to recapture will be reduced by 20% for each full year from the date of closing that the home is occupied in compliance with the terms of this program. G. The City will maintain the subordinate lien note and deed on file and will verify the residence requirement periodically. Verification steps may include on-site monitoring. 4/09 Revised First-Time Homebuyer's Program Page 2