City of Aurora Neighborhood Revitalization Strategy Area Down Payment Assistance Grant Application

Transcription

1 Investing In Our Community City of Aurora Neighborhood Revitalization Strategy Area Down Payment Assistance Grant Application Return completed form via fax to (630) , via to or via mail to City of Aurora, Neighborhood Redevelopment, 51 East Galena Avenue, Aurora IL, Name: Address: City: State: Zip Code: Phone: Best time & way to contact you? Amount of Grant Requested : Amount of Mortgage Loan: How much money in down payment or closing costs are you paying out-of-pocket for your mortgage? Note: You must pay at least $1,000 into your down payment/closing costs to receive the maximum $2,000 grant. Total Gross Monthly Household Income: Note: Income cannot exceed Program s maximum income limits. Family Size Income Limit 2014 INCOME LIMITS $40,220 $46,350 $52,150 $57,900 $62,550 $67,200 $71,800 $76,450 Ownership Status: Will be first home owned Lost prior home to divorce/disaster Haven t owned home in 3+ years Page 1 of 5

2 Have you applied for a mortgage? If yes, with whom? Note: All Lenders must be certified by the Illinois Housing Development Authority (IHDA). See Name of Loan Officer: Loan Officer s Phone: Loan Officer s What type of mortgage loan did you apply for? VA FHA Conventional Other Purchase Property Address : City: State: Zip Code: Addresses must be located within the City s Neighborhood Revitalization Strategy Area. Please see the map below. Submittal Attachments: 1. Copy of the executed purchase agreement; 2. Copy of loan qualification letter for first mortgage; 3. Evidence of borrower s 3 % down payment. 4. Most recent copy of your 1040 Income Tax Form along with two months of your most recent paycheck stubs; or award letters for SSI/SS/Annuities/AFDC/Retirement. I am submitting a request for disbursement of the City of Aurora s Neighborhood Revitalization Strategy Area Down Payment Assistance Grant referenced above. By entering my signature below, I certify that I meet all eligibility requirements as defined by the program. I also certify that I will be obtaining a 30- year fixed-rate mortgage with maximum 97% financing and 3% down payment. I hereby certify that all information in this application is true to the best of my knowledge. Please sign and date below. Page 2 of 5

3 Project Area Map City of Aurora Neighborhood Revitalization Strategy Area City of Aurora Neighborhood Redevelopment Division 51 East Galena Boulevard Aurora, Illinois Page 3 of 5

4 Attachment A NRSA Down Payment Assistance Grant Intake and Process Guidelines All program funds will be awarded on a first come-first served basis and will be subject to funding availability. This program will be available solely to applicants who wish to purchase homes within the NRSA. Application into the program itself does not reserve funds, but rather the completion of all application materials, loan underwriting, and the reservation of funds from a bank will create a placement of program funds. This is a 2,000 fully forgivable loan that covers up to 50% of housing down payment and closing costs. Funds can be used to pay all reasonable and customary down payment and closing costs. To qualify, generally the applicant will: Eligible Applicant o Be a first time homebuyer or who have not owned a home for at least three (3) years; o Meet the household income level of 80% or below of median family income guidelines as established annually by HUD; Eligible Housing Type o Homes purchased must be existing single family residences located in the City of Aurora s Neighborhood Stabilization Strategy Area (NRSA). o Homes purchased must be single-family residences. This includes condominiums, townhouses, and single units that are permanently affixed to a foundation. Multi-unit structures (duplexes, triplexes etc.) where more than one unit is being purchased are not eligible. o Borrower shall use the home purchased under this program as their primary residence and cannot rent or subdivide the home for the term of the loan. Process o Apply, and qualify for, a traditional first trust deed loan from an IHDA approved lender with no negative amortization, balloon payment or adjustable rate features. The Buyer may not receive cash back at the time of purchase (except for any pre-paid costs and property tax credits over and above the reserves required). o Submit (Before opening escrow): Program application and full attachments; Prequalification letter from an IHDA approved lender; Real property offer form; Upon staff approval, a letter will be issued from the City that reserves funds for ninety (90) days. Page 4 of 5

5 o Put a minimum of $1,000 down where the capital has been in the borrower s possession for at least 90 days; o Enter into escrow for a qualified property; o Accept covenants for a Three (3) year period for homeownership and home maintenance with a recapture provision where the grant will be repaid if the house is transferred or sold. Provide the City adequate notice and information a minimum of ten business (10) days before escrow close so that grant funds can be directly wired into escrow; o Submit to disburse funds into escrow: Title Company name, address, contact person, phone number, and escrow number; Wire instructions to transfer funds to escrow account (instruction must be on Title Company letterhead, signed by the escrow officer handling transaction); Itemization sheet (HUD-1); Evidence of buyer s down payment in escrow; Appraisal; Home inspection report; and Evidence of home warranty. Funds will be wired into escrow within Seven (7) days of close. Page 5 of 5

6 CITY OF AURORA DOWN PAYMENT ASSISTANCE GRANT PROGRAM AGREEMENT BETWEEN PROPERTY OWNER AND THE CITY OF AURORA This agreement ( Agreement ) dated this day of, 20 ( Effective Date ), by and between the City of Aurora, Illinois ( City ) and ( Owners ), together the legal owners of real property commonly known as:, Aurora, Illinois ( Property ). WHEREAS, pursuant to its home rule powers, the City has established a Down Payment Assistance Grant Program ( Program ) for certain qualified homebuyers in the City s Neighborhood Revitalization Strategy Area ( NRSA ); and WHEREAS, the goal of the Program is to provide financial assistance in the form of grant payments in amounts of up to $2,000 for necessary and proper down payment and closing costs to income eligible first-time homebuyers who meet certain Program qualifications; and WHEREAS, the Owners have made an application for such a payment ( Payment ) in the amount of $2,000 under the Program and have submitted statements and information to the City in support of their eligibility under the Program; and WHEREAS, based upon the information submitted to it by the Owners, the City has determined that the Owners are eligible to participate in the Program and to enter into this Agreement; and WHEREAS, the purpose of this Agreement is to provide for a binding agreement between the Owners and the City relative to the Program and Payment terms and conditions. WHEREFORE, upon the considerations hereinabove set forth and for other good and valuable considerations, the parties do hereby covenant and agree as follows: I. PAYMENT AMOUNT, REPAYMENT, FOREGIVENESS, TERMINATION AND ENFORCEMENT A. A Payment in the amount of $2,000 shall be made by the City to the Owners pursuant to requirements of the Down Payment Assistance Grant Program for use towards down payment and closing costs in the purchase of the Property. B. As a condition of the provision of the Payment by the City, the Owners agree to allow a lien in the amount of the Payment to be recorded by the City against title to the Property (the Agreed Lien ), and to abide by certain conditions (the Forgiveness Conditions ). Should the Owners successfully abide by the Forgiveness Conditions for a period of three (3) years from the Effective Date of this Agreement (the Forgiveness Date ), the entire Payment amount shall be forgiven, in full, by the _2

7 City, and the Agreed Lien shall be released. The Forgiveness Conditions are as follows: 1. Ownership. Owners are required to maintain ownership of the Property for a period of three (3) years following the Effective Date of this Agreement. Transfers of the Property by will or operation of law upon the death of a joint tenant Owner or death of either spouse as tenants by the entirety Owner, transfers to a spouse as a result of a dissolution of marriage, or refinancing that lowers the interest rate, decreases the loan term or lowers the monthly payment of the mortgage loan shall not be deemed to be changes in ownership as intended hereinunder. 2. Maintenance. Owners are required to maintain the Property and structures thereon in good condition and repair and in conformance with all City Building Codes, Property Maintenance Codes, and other ordinances, codes and regulations governing the condition of property and structures within the City. 3. Inspections. Owners shall allow inspections of the Property by the City at all reasonable times, and shall request and allow all necessary or required inspections by the City s building inspectors. 4. Taxes and Insurance. Owners shall pay all taxes and assessments levied or assessed upon the Property during the term of this Agreement and shall keep the Property and structures thereon insured against fire and extended perils. 5. Compliance with Agreement. Owners shall comply with all terms and conditions set forth in this Agreement and in the Program Guidelines. C. Should the Owners fail or refuse to comply with any of the Forgiveness Conditions, a Triggering Event shall immediately be deemed to have occurred, and the City shall have the right, at its option, to declare the amount of the Payment to be immediately due and owing from Owners to the City, and to pursue the options set forth below in subsections D. and E. D. Upon occurrence of a Triggering Event, and a declaration by the City that the amount of the Payment is immediately due and owing, Owners shall immediately repay to the City the entire Payment amount, plus an amount equal to ten percent (10%) of the Payment amount, which additional amount may be waived by the City, in its discretion, in cases of extenuating circumstances. E. In addition, upon occurrence of a Triggering Event, the City may proceed to use any and all legal remedies as are deemed necessary to recapture the Payment amount or otherwise enforce the terms of this Agreement or the Agreed Lien. Such remedies include, but are not limited to, specific performance or enforcement and/or foreclosure on the Agreed Lien. Owners hereby agree that if the City files any legal _2 2

8 proceedings to enforce this Agreement, then the Owners shall be responsible for any and all attorney s fees, legal and/or court costs associated with such legal proceeding. II. COVENANTS, REPRESENTATIONS, AGREEMENTS AND WARRANTIES OF THE OWNERS A. The Owners covenant, represent, and/or warrant to the City as follows: 1. Income Limits. That the household income attributable to said Owners from all sources, including wages and tips, pensions, alimony (but not child support), interest, dividends, net rental income, public assistance and social security, earned by the Owners plus regular contributions made by other adult members of the Owners household (if any) during the calendar year preceding the date of the application meets the household income level limit for the Program of 80% or below the median family income levels established by the U.S. Department of Housing and Urban Development (80% of the SMSA median). 2. Acquisition Eligibility. That the Owners are first-time homebuyers or persons who have not owned a home for at least three (3) years. 3. Single-Family Residence. That the Property being purchased is a single-family residence (which may include condominiums, townhouses, and single units that are permanently affixed to a foundation). 4. Primary Residence. That the Property being purchased shall be the Owners primary residence and shall remain their primary residence throughout the term of this Agreement. 5. No Rental or Subdivision. That Owners shall not rent or subdivide the home during the term of this Agreement. 6. NRSA. That Owners reside within the NRSA. B. The Owners agree as follows: 1. Lien Recordation. To the recordation by the City of an Agreed Lien against title to the Property in the amount of the Payment. 2. Closing Notification. To provide the City with adequate notice and information related to closing on the Property and the closing escrow, including but not limited to, escrow number and wire instructions, a minimum of ten (10) business days before closing so that the City may wire the Payment amount directly into the escrow. 3. Program Guidelines. To follow and obey the Program Guidelines, which are attached hereto as EXHIBIT A and made a part hereof _2 3

9 III. CITY AGREEMENTS. The City agrees as follows: A. Payment and Lien. To disburse the Payment amount to the Owners via a wire into the closing escrow prior to closing, so long as all applicable preconditions have been met by Owners. B. Release. To record a release of the Payment within ninety (90) days of the Forgiveness Date, in the event that Owners have met all Forgiveness Conditions. IV. ADDITIONAL PROVISIONS A. Conformance with Federal Requirements. The Down Payment Assistance Grant Program and Payment shall be funded from time to time by Federal grant funds under the Community Development Block Grant Program or other similar grant-in-aid programs, and the parties hereto shall abide by and comply with such Federal standards, guidelines or regulations as may be established from time to time with respect to the use of such Federal funds. B. Indemnity. The Owners shall indemnify, hold and save the City, its elected officials, officers, agents, employees, contractors, and attorneys harmless, and defend the City against any and all claims, suits, damages, costs, losses, and/or expenses incurred, arising out of or connected in any way with the purchase of the Property, this Agreement and provision of the Payment by the City under this Agreement. C. Term. This Agreement shall be in effect against the Owners and the City as of the Effective Date, and shall remain in full force and effect until the Payment is forgiven by the City and a lien release documenting the forgiveness is recorded, or, upon the occurrence of a Triggering Event, repayment in full of the Payment by the Owners, along with any associated costs and penalties and the subsequent recordation of a release of the Agreed Lien documenting such repayment. The City shall have the option to terminate this Agreement for any reason upon thirty (30) days written notice to the Owners. D. Validity. The invalidity of any section or subsection of this Agreement shall not impair the validity of any other section or subsection. If any provision of this Agreement is determined to be unenforceable, such provision shall be determined severable and the Agreement may be enforced with such provision severed or as modified by court. E. Governing Law. This Agreement shall be deemed to have been executed, delivered and accepted in the State of Illinois and shall be governed by and construed in accordance with the laws of the State of Illinois. F. Entire Agreement. This Agreement embodies and constitutes the entire understanding between the parties with respect to the transaction contemplated _2 4

10 herein, and all prior agreements, understandings, representations and statements, oral or written, are merged into this Agreement. G. Successors. This Agreement shall be binding upon the heirs, executors, administrators, successors, assigns and trustees in bankruptcy of the respective parties hereto. H. Authority. The persons signing this Agreement on behalf of the City and Owners warrant that they have the authority to legally bind their respective parties to the terms and conditions of this Agreement. IN WITNESS WHEREOF, the City and the Owners have executed this Agreement as of the date first above written. CITY OF AURORA By: Owner signature Its: Owner signature [THIS SPACE INTENTIONALLY LEFT BLANK] _2 5

11 State of Illinois ) ) SS County of Kane ) I, the undersigned, a Notary Public in and for said County, in the State aforesaid, DO HEREBY CERTIFY THAT, for the City of Aurora and, as Owners, personally known to me to be the same persons whose name(s) is/are subscribed to the foregoing instrument, appeared before me this day in person, and acknowledged that they signed and delivered the said instrument as their free and voluntary act, for the uses and purposes therein set forth. Given under my hand and official seal this day of, 20. Notary Public _1

12 321714_1 EXHIBIT A

13 Prepared By and After Recording Please Return to: City of Aurora Neighborhood Redevelopment Division 44 E. Downer Place Aurora, Illinois NOTICE OF LIEN CLAIM FOR RECORDER'S USE ONLY JEFFREY B. McLAUGHLIN, being first duly sworn on oath, deposes and says that pursuant to an Agreement entered into between the City of Aurora and the record owner(s) of the property described below and commonly known as, Aurora, Illinois (the Property ), the City of Aurora has provided the record owner(s) with Community Development Block Grant Funds towards down payment and closing costs pursuant to the City s Down Payment Assistance Grant Program, said record owner(s) having agreed to allow the City to record a lien against said property in the amount of the funds provided. The Property is described as follows: PROPERTY Property Address:, Aurora, Illinois Legal Description: P.I.N.(s): Amount of Lien: $ A lien is declared against this Property in the sum stated. The Property is secured by this lien pursuant to the Agreement between the parties effective, The lien shall be released three (3) years from the Effective Date, on, 20, pursuant to the terms of the Agreement between the parties, so long as the record owner(s) has fulfilled his/her/their obligations under the Agreement. DATED this day of, 20 CITY OF AURORA, a municipal corporation Subscribed and Sworn to before me this day of, 20. By: Jeffrey B. McLaughlin, Manager Neighborhood Redevelopment Division Notary Public _1

14 Prepared By, and After Recording Please Return to: City of Aurora Department of Neighborhood Redevelopment 44 E. Downer Place Aurora, Illinois FOR RECORDER'S USE ONLY RELEASE OF LIEN KNOW ALL MEN BY THESE PRESENTS that the City of Aurora, a municipal corporation of the State of Illinois, pursuant either to the forgiveness terms of an Agreement entered into between the City of Aurora and and the record owner(s) of the property described below and commonly known as, Aurora, Illinois (the Property ), or for and in consideration of the total sum of $, does hereby release and quit claim unto the owner thereof any and all interest or claim whatsoever it may have acquired by virtue of a certain lien recorded in the Recorder's Office of County, Illinois, as Document No. on, 20, in the amount of $ said lien being on the premises described as follows, to-wit: PROPERTY Property Address:, Aurora, Illinois Legal Description: P.I.N.(s): Amount of Lien: $ DATED this day of, 20 CITY OF AURORA, a municipal corporation Subscribed and Sworn to before me this day of, 20. Notary Public By: Jeffrey B. McLaughlin, Manager Neighborhood Redevelopment Division _1