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DEVELOPMENT DEPARTMENT
OF THE CITY OF SAN BERNARDINO
ECONOMIC DEVELOPMENT AGENCY
REOUEST FOR COMMISSION/COUNCIL ACTION
FROM: KENNETII 1. HENDERSON
Executive Director
SUBJECT: MORTGAGE ASSISTANCE
PROGRAM (MAP)
DATE: October 12, 1994
Svnopsis of Previous Commission/Council/Committee Actlon{s):
On October II, 1994, the Housing Committee voted to fOIWard the Mortgage Assistance Program to the Community
Development Commission for review and consideration.
Recommended Motion{ s ):
(Community Development Commission)
MOTION A: RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAN
BERNARDINO, ON BElW..F OF THE REDEVELOPMENT AGENCY OF THE CITY OF SAN
BERNARDINO, AUTHORIZING AND ADOPTING MORTGAGE ASSISTANCE PROGRAM.
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strator
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KENNETH J. HENDERSON (
Executive Director
Contact Person(s):Kenneth 1. Henderson/Edward L. Flores
Phone: 5081
Project Area(s): All
Ward(s): All
Supporting Data Attached: StaffReoort . Resolution' Attachment
FUNDING REQUIREMENTS: AmountS 800 000
Source: LowlMod
Budget Authority:
FY 1994-95 BuMet
Commission/Council Notes:
KJH:ELF:paw: map.cdc
COMMISSION MEETING AGENDA
Meeting Date: 10/17/94
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Agenda Item No:
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DEVELOPMENT DEPARTMENT
OF THE ECONOMIC DEVELOPMENT AGENCY
STAFF REPORT
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MORTGAGE ASSISTANCE PROGRAM (MAP)
On November 2, 1992, the Community Development Commission approved Program Proposal(s)
utilizing available FY 1992-93 Low/Mod Housing Funds for $150,000 for the First Time Home
Buyers Assistance Program. Subsequently during FY 1993-94 Budget approval process, the
Community Development Commission approved a line item budget for homeownership
opportunities for an amount of$450,000. Additionally, during FY 1994/95 budget approval
process, the Community Development Commission approved a line item budget for Mortgage
Assistance Programs of $500,000 for existing homes and $200,000 for new housing constructed
homes.
On October 11, 1994, the Housing Committee voted to forward the Mortgage Assistance Program
to the Community Development commission for review and consideration.
BACKGROUND
The Mortgage Assistance Program (MAP) makes available a limited number of deferred payment
second mortgages, in amounts up to 10% percent of the purchase price (example: $10,000 towards
a $100,000 purchase) for single-family detached homes as assistance towards down payments for
qualified home buyers. This program is specifically designed to provide qualified home buyers with
down payment/closing costs assistance necessary to purchase a single-family detached home in the
City of San Bernardino. Only single-family detached properties located within the City of San
Bernardino are eligible for this program. Currently, condominiums or townhomes are not eligible
for assistance through this program. The purchase price of the single-family home must be below
$150,000.
The Mortgage Assistance Program is a deferred payment equity participation loan secured by a
second deed of trust. There are no monthly payments and no interest charges; however, the Agency
will share with the home buyer any equity realized at the time of sale, transfer or refinance in a
proportionate amount equal to the percentage of the loan to the original purchase price (example:
10"10 towards an original $100,000 purchase price would be an equity share repayment to the
Agency of 10% of the price at the time of resale, if the resale price is $120,000, 10% or $12,000
would be repaid to the Agency). The loan is due and payable only when the property is sold,
refinanced, or a change in title occurs. At the time of sale, the Agency will then receive an equity
share of the property in an amount equal to the Agency's original down payment assistance.
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KJH:ELF:paw: map.cdc
COMMISSION MEETING AGENDA
Meeting Date: 10/17/94
Agenda Item No:
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DEVELOPMENT DEPARTMENT STAFF REPORT
MORTGAGE ASSISTANCE PROGRAM (MAP)
October 12, 1994
PAGE-2-
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To participate in the Mortgage Assistance Program (MAP) the applicant must first meet established
"affordable" housing cost requirements, as defined by State Redevelopment Law. "Affordable"
housing cost is determined as the percentage of monthly gross household income, which is utilized
specifically towards the total cost of owning a home. This calculation, however, will be determined
by the lender and varies depending on actual annual household income and the home selected for
purchase. -
Annual household income requirements are as follows:
I Person $35,550
2 Person $40,600
3 Person $45,700
4 Person $50,750
5 Person $54,800
6 Person $58,850
The borrower will need monies equal to three (3%) percent of the purchase price, as the borrowers
share of the require down payment and closing costs (example: $100,000 home -- $3,000 required
borrower monies). Further, the borrower cannot have had ownership interest in a principal
residence at any time within the past three (3) years. All home buyers will be required to
satisfactorily complete community home buyer's training, prior to receiving MAP assistance.
The Mortgage Assistance Program (MAP) will be subject to funding available allocations as
determined by the Community Development Commission during Agency budget adoptions for each
fiscal year.
To date, the Mortgage Assistance Program has been very successful as 101 loans have been
processed with the follow average statistics of the program as follows:
Family Gross Income Purchase Price Agen<;y Assistance Family Size
$39,715 $109,209 $7,148 Four (4)
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KJH:ELF:paw: map.cdc
COMMISSION MEETING AGENDA
Meeting Date: 10/17/94
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DEVELOPMENT DEPARTMENT STAFF REPORT
MORTGAGE ASSISTANCE PROGRAM (MAP)
October 12, 1994
PAGE-3-
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The goal of this program is to promote homeownership opportunities within the City of San
Bernardino. Therefore, staffis recommending that the Mortgage Assistance Program (MAP) be
implemented on a funds available basis.
Based upon the foregoing, staff recommends adoption oHorm motion.
~~~~a~,/L~
KENNETH J. HENDERSON, Exec tive Director
Development Department
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KJH:ELF:paw: map.cdc
COMMISSION MEETING AGENDA
Meeting Date: 10/17/94
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Agenda Item No:
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Item:
Exhibit "A"
Action to
be Taken:
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COMMUNITY DEVELOPMENT COMMISSION OF THE
CITY OF SAN BERNARDINO, CALIFORNIA
AGENDA
October 17, 1994
RESOLUTION OF THE COMMUNITY DEVELOPMENT
COMMISSION OF THE CITY OF SAN BERNARDINO, ON
BEHALF OF THE REDEVELOPMENT AGENCY OF-THE CITY OF
SAN BERNARDINO, AUTHORIZING AND ADOPDTING
MORTGAGE ASSISTANCE PROGRAM
Mortgage Assistance Program
Adopt Resolution.
Certified copy of Resolution to be returned to Sabo & Green, A
Professional Corporation.
SBEO\OOOl\DOC\1040
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RESOLUTION NO.
RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF
THE CITY OF SAN BERNARDINO, ON BEHALF OF THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO,
AUTHORIZING AND ADOPTING MORTGAGE ASSISTANCE PROGRAM
WHEREAS, the Redevelopment Agency of the City of San
Bernardino (the "Agency") has in previous years approved
assistance to low and moderate income households in acquiring
single-family homes; and
WHEREAS, the current condition of the local economy and
11 of the housing market in the City of San Bernardino makes it
12 difficult for low and moderate income families to purchase
13 single-family detached homes in the City; and
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15 WHEREAS, the Agency deems it to be in the public
16 interest to encourage and assist home ownership by low and
17 moderate income families; and
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19 WHEREAS, the Agency has developed a Mortgage Assistance
20 Program whereby 20% Housing Set-Aside funds may be utilized to
21 assist certain qualifying low and moderate income families to
22 acquire single-family detached homes in the City of San
23 Bernardino, a copy of which program is attached hereto as
24 Exhibit "A" and by this reference incorporated herein.
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26 NOW, THEREFORE, THE COMMUNITY DEVELOPMENT COMMISSION
C 27 ACTING ON BEHALF OF THE REDEVELOPMENT AGENCY OF THE CITY OF
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SAN BERNARDINO DOES HEREBY RESOLVE, DETERMINE AND ORDER AS
FOLLOWS:
SECTION 1. The Recitals hereinabove are true and
correct and are incorporated herein by this reference.
SECTION 2. The Agency hereby approves and adopts
the Mortgage Assistance Program attached hereto as Exhibit "A."
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RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE C~~~ ~~
SAN BERNARDINO, ON BEHALF OF THE REDEVELOPMENT AGENCY OF THE CITY
OF SAN BERNARDINO, AUTHORIZING AND ADOPTING MORTGAGE ASSISTANCE
PROGRAM
SECTION 3.
The findings and determinations herein
shall be final and conclusive. This Resolution shall take effect
upon the date of its adoption.
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I HEREBY CERTIFY that the foregoi'ng Resolution was duly
adopted by the Community Development Commission of the City of
San Bernardino at a
meeting
thereof, held on the
day of
1994, by the following vote, to wit:
Commission Members:
AYES
NAYS
ABSTAIN ABSENT
NEGRETE
CURLIN
HERNANDEZ
OBERHELMAN
DEVLIN
POPE-LUDLAM
MILLER
Secretary
day of
The foregoing resolution is hereby approved this
, 1994.
Tom Minor, Chairman
Community Development
Commission of the
City of San Bernardino
Approved as to
form and legal content:
By:
Agency Counsel
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STATE OF CALIFORNIA
COUNTY OF
On before me,
(here insert name and title of the officer), personally appeared
, personally known to me (or proved to
me on the basis of satisfactory evidence) to be the person(s)
whose name (s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s), or the-entity upon
behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Signature
(Seal)
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0 1 Exhibit "A"
2 Mortgage Assistance
Program
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Exhibit A
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MORTGAGE ASSISTANCE PROGRAM (MAP)
The Mortgage Assistance Program (MAP) makes available a limited number
of deferred payment second mortgages, in amounts up to 10% percent of
the purchase price (example: $10,000 towards a $100,000 purchase) for
single-family detached homes as assistance towards down payments for
qualified homebuyers. This program is specifically designed to
provide qualified homebuyers with down payment/closing costs
assistance necessary to purchase a single-family detached home in the
City of San Bernardino. Only single-family detached properties
located within the City of San Bernardino are eligible for this
program. Currently, condominiums or townhouses are not eligible for
assistance through this program. The purchase price of the
single-family home must be below $150,000.
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The Mortgage Assistance Program is a deferred payment equity
participation loan secured by a second deed of trust. There are no
monthly payments and no interest charges; however, the Agency will
share with the homebuyer any equity realized at the time of sale,
transfer or refinance in a proportionate amount equal to the
percentage of the loan to the original purchase price (example: 10%
towards an original $100,000 purchase price would be an equity share
repayment to the Agency of 10% of the price at the time of resale - if
the resale price is $120,000, 10% or $12,000 would be repaid to the
Agency). The loan is due and payable only when the property is sold,
refinanced, or a change in title occurs. At the time of sale, the
Agency will then receive an equity share of the property in an amount
equal to the Agency's original down payment assistance.
To participate in the Mortgage Assistance Program (MAP) the applicant
must first meet established "affordable" housing cost requirements, as
defined by State Redevelopment Law. "Affordable" housing cost is
determined as the percentage of monthly gross household income, which
is utilized specifically towards the total cost of owning a home.
This calculation, however, will be determined by the lender, and
varies depending on actual annual household income and the home
selected for purchase.
Annual household income requirements, in accordance with Housing and
Urban Development guidelines and revised each year, are, as of this date,
as follows:
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1 Person
2 Person
3 Person
4 Person
5 Person
6 Person
$35,550
$40,600
$45,700
$50,750
$54,800
$58,850
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MORTGAGE ASSISTAl'lCE PROGRAM (MAP)
Page -2-
The borrower will need monies equal to three (3%) percent of the
purchase price, as the borrowers share of the required down payment
and closing costs (example: $IOO,OOO/home $3,000 required borrower
monies). Further, the borrower cannot have had ownership interest in
a principal residence at any time within the past three (3) years.
All homebuyers will be required to satisfactorily complete community
homebuyers training, prior to receiving MAP assistance.
The Mortgage Assistance Program (MAP) will remain in effect unti~
rescinded by the Commission, subject to funding available allocations
as determined by the Community Development Commission during Agency
budget adoptions for each fiscal year.
The goal of this program is to promote homeownership opportunities
within the City of San Bernardino.
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