Elkhart County & City of Nappanee. Neighborhood Stabilization Program Policy and Procedures Manual

Transcription

1 Elkhart County & City of Nappanee Neighborhood Stabilization Program Policy and Procedures Manual

2 Table of Contents Purpose and Executive Summary 1 Requirements / Restrictions 2 Administrative Set-Up 3 Staffing and Support Plan 4 Key Terms of NSP Financing 6 Property Acquisition 8 Properties Contributed by Developer 14 Relocation of Occupants and Tenant Protections 14 Rehabilitation, New Construction and Reconstruction 14 Funding of Construction Work and Soft Costs 17 Pricing of Homes and Development Subsidies 18 Marketing and Sales of NSP Homes 19 Homebuyer Application and Prequalification 20 Homebuyer Counseling and Education 23 Waiting List 24 Executing Sale Agreements with Buyers 24 Home Sale Closing Requirements 25 Post-Purchase Counseling 25 Management of Excess Revenues, Liens and Resale Controls 26 Reporting and Recordkeeping Requirements 26 Appendices 1 Definitions and Acronyms 2 NSP3 Action Plan 3 County City Sub Recipient Agreement 4 Target Area Map 5 draft Developer Agreement 6 Draft Budget worksheet 7 Purchase offer Addendum forms 8 NSP rehab standards Nappanee 9 Draft Homebuyer Application 10 HUD Approved Counseling Agencies in Indiana 1

3 NSP Single-Family Development and Sales Program Manual: City of Nappanee (Elkhart County, Indiana) I. Purpose and Executive Summary The purpose of this Manual is to govern the implementation of single-family acquisition, rehabilitation and home sales programs being carried under NSP Agreements with The City of Nappanee as Sub-recipient of Elkhart County, Indiana. The Manual includes policies and procedures to be followed regarding eligible uses of NSP funds, property acquisitions, rehabilitation/construction, marketing, intakes/applications, counseling, sales, and recapture-resale control mechanisms. In July of 2008, Congress passed the Housing and Economic Recovery Act of 2008 (HERA) which made $3.9 billion in funding available to cities, counties and states to counter the effects of excess foreclosed housing units and neighborhood deterioration. These funds were designated as the Neighborhood Stabilization Program (NSP). The NSP Program was extended and expanded twice under title XII of the American Recovery and Reinvestment Act of 2009 (ARRA), and by Section 1497 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank). NSP was established for the purpose of stabilizing communities that have suffered from foreclosures and abandonment by the purchase and redevelopment of foreclosed and abandoned homes and residential properties, promote property reuse and neighborhood stability and build local capacity to effectively acquire, manage, rehab and sell properties to ensure that homeownership and rental housing are available to low- and moderate-income persons. On or about September 29, 2008, the US Department of Housing and Urban Development (HUD) announced expansion of recipient eligibility criteria and accompanying regulations, known as NSP3. Elkhart County Government received notification of its eligibility to receive an allocation of NSP3 funds. Upon completion of HUD's acceptance requirements which included HUD approval of the County s NSP3 Action Plan (Appendix 2), Elkhart County was allocated $1,193, to combat neighborhood deterioration caused by excess foreclosed / abandoned housing units through acquisition, rehabilitation and disposition of foreclosed homes to income eligible households. March 10, 2011 Elkhart County entered into an Agreement with HUD pursuant to the authority of section 1497 of the Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act Public Law ; 7/21/2010), Title XII of Division A of the American Recovery and Reinvestment Act of 2009 (Recovery Act - Public Law 111-5; 2/17/2009) and sections of the Housing and Economic Recovery Act of 2008 (HERA - Public Law ; 7/30/2008). This Agreement established project partnership enabling Elkhart County to implement/utilize NSP3 funds in the implementation of the project known as NSP3. On October 24 th 2011 Elkhart County entered into an Agreement with the City of Nappanee to collectively implement and administer the NSP project as outlined in the HUD approved Action Plan. This agreement summaries the responsibilities and requirements necessary to implement NSP3 program benefiting the City of Nappanee (Appendix 3). 1

4 Requirements / Restrictions NSP3 funds in the amount of one million one hundred ninety-three thousand one hundred ninety-four dollars ($1,193,194.00) are obligated for use in compliance with the HUD approved Action Plan, HUD Award Agreement, and the Agreement between County and City. These amounts represent the total NSP3 funding allocated to the County and contingent upon the City s performance and not an entitlement to a certain grant amount, and shall only be disbursed for approved projects and costs. It is a strict requirement that all project activities of NSP3 funds must be completed by March 9, In addition, no less than 50% of NSP3 funds must be expended and drawn by March 9, 2013 ($596,597.00) and 100% of NSP3 funds must be expended and drawn by March 9, 2014 ($1,193,194.00). NSP3 project activities are required to be an Eligible Activity and align with CDBG National Objectives. The program must ensure and document that NSP3 activities meet LMMI national objective, eligible use, allowable cost, and eligible activity requirements of the NSP Notices and CDBG Regulations. The program must ensure that any expenditure of NSP3 funds will be in compliance with all requirements, and acknowledges that NSP3 funds will only be provided as reimbursement for eligible costs incurred, including actual expenditures or invoices for work completed. Additionally, the program must ensure that project plans and activities benefits all members of the community without regard to race, color, national origin, sex, religion, familial status or disability. The program will take affirmative steps to ensure that no person is denied the benefit of housing or housing-related services for any of the foregoing reasons. It is also required that AT LEAST 25% of NSP3 funds be expended to provide housing to individuals or families earning at or below 50% of the Area Median Income (AMI) through the purchase and redevelopment of abandoned and/or foreclosed homes or residential properties. In addition, all activities funded by NSP3 must benefit low- and moderate-income persons whose income does not exceed 120% AMI. NSP3 funds can only address abandoned and/or foreclosed properties to provide permanent housing. NSP3 funds cannot be used for group homes or shelters. The NSP3 regulations allow for four types of activities to be undertaken: 1. Establish financing mechanisms for the purchase and rehabilitation of foreclosed homes and residential properties. 2. Acquiring and rehabilitating homes and residential properties that have been abandoned and/or foreclosed upon in order to sell, rent or develop such homes and properties. 3. Demolish blighted foreclosed and/or abandoned residential properties. 4. Redevelop demolished and/or vacant residential properties. In the implementation of project activities, the program must undertake only those activities permitted and must comply with all provisions of the Agreement between the County and City, and project requirements in the Action Plan. Funds may be used to pay eligible costs arising from eligible uses provided activities to which such costs are related and are carried out in compliance with all applicable requirements. In particular Acquisition No acquisitions may occur without site specific environmental clearance, and 2

5 determination of the applicability of URA provisions. Demolition Primary structures on properties acquired or contributed to may not be demolished unless they are declared as blighted by the City and/or the County. Construction/Rehabilitation/Reconstruction The program may use NSP3 funds for the construction, rehabilitation or redevelopment of properties as approved by the County and permitted by the Agreement between the County and City and shall implement the requirements in the Action Plan as applicable to all projects. NSP regulations require that the program acquire properties at a discount. The minimum discount required by NSP is 1% from the current appraised value. In addition, the sale of the unit shall not exceed the total investment made (e.g. acquisition, carrying costs, rehabilitation cots, marketing and sales costs). The cost of maintaining the property in a static condition (e.g. routine yard maintenance, boarding/securing the property) is not to be factored into the ultimate sales price, but may be paid for under an approved developer s fee. Proceeds received prior to July 30, 2013 must be used as program income for the same NSP funded activity which generated it. Proceeds received after July 20, 2013 are no longer required to be returned to HUD for deposit with the US Treasury, however, this program income will be required to comply with CDBG guidelines for the use of program income and future HUD guidance or directives. NSP regulations allow no more than 10% of the grant and any program income to be utilized for administration costs incurred in management and implementation of the NSP3 program. These funds may only be used for administration of NSP3 and may not be used to finance the broader governmental functions of the awardee and/or subrecipient. Administrative Set-Up Roles and Responsibilities Elkhart County and the City Nappanee will share roles and responsibilities to successfully implement the NSP3 program through eligible activities. This includes oversight of the purchase and rehabilitation/redevelopment of foreclosed and/or abandoned homes to stabilize neighborhoods affected by large numbers of foreclosures. The City intends to partner with a developer or developers to streamline the implementation of these activities. The intent of the program is to sell rehabilitated/redeveloped properties to ensure that homeownership and rental housing are available to low and moderate-income citizens. The program s primary strategies include: 1.Establish financing mechanisms for the purchase and rehabilitation of foreclosed homes and residential properties; 2. Acquiring and rehabilitating homes and residential properties that have been abandoned and/or foreclosed upon in order to sell, rent or develop such homes and properties; 3.Demolish blighted foreclosed and/or abandoned residential properties and 4. Redevelop demolished and/or vacant residential properties. Program activities will focus within the target area known as Napp1 which encompasses a majority of City limits. Target area map can be found at Appendix 4 Activity goals include: 1. Acquisition of no less than 3 abandoned and/or foreclosed residential properties 2. Demolition of no less than 1 vacant abandoned and/or foreclosed residential property 3. Rehabilitation or redevelopment of no less than 4 acquired abandoned and/or foreclosed residential properties 3

6 II Staffing and Support Plan Internal Staff and Support: NSP3 Oversight Committee (Oversight Committee) This committee consists of 4 appointed individuals; the Mayor, the County Grants Administrator, the Clerk Treasurer and the Code Enforcement Officer. The Committee s duties include: implementation and administrative oversight, approve processes, financing limits, establish staff authority, create responsive structure for board decisions, monitor pipeline of housed and end-users, establish parameters for permanent financing for rental properties, approve reporting schedule, articulate goals regarding; reserves, overruns, managing staff, accounting, staff capacities, fund accounting and community relations. The Oversight committee will procure an administrative Consultant (through the City) which will report directly to the committee. County implementation and administrative oversight The County Grants Administrator will monitor all program activities and conduct progress inspections of work completed and review of project files and information to protect its interests as lender and regulatory authority for the project, and will provide information to the City regarding any progress inspections or monitoring to assist it in ensuring compliance. The County s review and approval of the work will relate only to overall compliance with the general requirements of the Agreement between the County and City, NSP3 requirements, and all County regulations and ordinances. The County Grants Administrator will serve on the Oversight Committee. The County (The County Grants Administrator) will report to HUD via the Disaster Reporting Government Assistance (DRGR) system and on in a timely manner as required by HUD. The County Grants Administrator is responsible for management of, and inputting expenditure and status data into, the DRGR system. The County Grants Administrator will manage all draws of NSP3 funds from HUD and payment of valid and properly documented draw requests from the City. The County will process requests for disbursements of NSP3 funds, in a timely manner. The County will clearly and promptly describe any deficiencies identified by the County that prevent a drawdown or portion of a drawdown request from being approved. Funds drawn down will be deposited into the County s NSP account. The County will then transfer funds to the City s NSP account for disbursement. The Clerk Treasurer will manage final disbursements. Program Contracts: Administrative Consultant (Consultant): Provide recommendations to the Oversight committee regarding implementation and monitoring of all aspects of the NSP Program. This contractual role was procured using a Request for Proposal process resulting in a negotiated fixed price contract. The consultant will be responsible for monitoring developer progress and developer compliance with NSP regulations including reviewing, reporting and making recommendations to the oversight committee on; acquisition, work write-ups, cost estimating, environmental reviews, material lists, prioritizing purchase opportunities, contracts, change orders, inspections, construction management, 4

7 evaluating vendor capacities and expertise, procurement process and structure, rehab standards and design specifications, budget and time line monitoring The consultant will report to the oversight committee on all aspects of drafting and recommending changes to this Policies and Procedures Manual. The Consultant will assist with program marketing, evaluation of financing mechanisms, evaluation of homebuyer needs and suggestions of policy changes which may better meet homebuyer needs. The consultant will coordinate reviews and approvals of documentation from developer, developers service providers and homebuyers. Necessary approvals will be requested from the oversight committee and its members, wherever practical, via electronic means to streamline the program and reduce the time required for successful implementation. The consultant will evaluate environmental reviews, environmental hazard clearance, homebuyer waiting list and eligibility documentation from the developer and make recommendations of approve or deny (with explanations) to the oversight committee. Approvals of payments will be transmitted to the County Grants Administrator for DRGR input (with copies to the Clerk Treasurer for disbursement) Developer Developer will be procured using a Request for Proposals process which will result in a negotiated contract. The final contract costs will be reviewed/negotiated by the Oversight committee and Consultant for appropriateness. The developer is responsible for acquisition, rehabilitation, demolition, and program delivery for individual properties and beneficiaries. Developers will take title to approved NSP properties, rehabilitate, reconstruct, demolish and build new structures, then market the resultant products to eligible NSP3 beneficiaries with oversight and approvals of the Administrative Consultant and Oversight Committee. The Developer(s) will be responsible for hiring and coordination of program delivery providers to meet the requirements of the NSP3 Program and related implementation regulations and HUD guidance. It is the intent of the City that wherever practical preference be given to local service providers within Nappanee, Elkhart or adjacent counties. It is especially important to the City that preference be given to Section 3 eligible businesses and individuals. Program delivery providers may be employees of the developer or independent. They include: Appraiser - Conducts an appraisal of the property prior to an offer being submitted to the seller. Conducts a post-rehabilitation appraisal of the property to aid in determining the sales price. Must be licensed to conduct appraisals in Indiana, must be familiar with the Nappanee market and must follow NSP3 appraisal requirements including URA appraisal requirements of 49 CFR The appraisal must have been completed within 60 days of the offer made for the property (an initial offer can be made, subject to the completion of the appraisal within 60 days of a final offer). Inspectors - Conduct necessary inspections of a given property during escrow period and draft the scope of work to be completed during rehabilitation by the contractors. Inspectors in the highly specialized fields of hazardous materials identification and abatement (eg. lead, asbestos, mold), must be certified and/or licensed in the appropriate field. 5

8 Homebuyer Counseling the program requires households interested in purchasing a property as part of the NSP3 program to complete 8 hours of homebuyer counseling. Counseling services must be provided by a HUD Certified Organization. The Developer will contract with one or more agencies that are qualified to provide pre-purchase counseling and homebuyer education to prospective homebuyers. Construction Contractors Responsible for the execution of the scope of work/rehabilitation Property Manager(s) - Responsible for the care of multi-family properties upon the close of escrow, the marketing of rental properties to income eligible household after the completion of rehabilitation and long term administration of these rental units as affordable rentals. Asset Manager - Responsible for the care of single-family properties upon the close of escrow and for the marketing and disposition of the property after the completion of rehabilitation. III. Key Terms of NSP Financing Developer s expenditures for program delivery will be limited and will be governed by the Developer Agreement. The sample developer agreement, attached as Exhibit 5, will be used as a starting point for a negotiated contract(s) A. Approval and Funding of Demolition Costs Primary structures on properties acquired or contributed to may not be demolished unless they are: 1) declared as blighted in a written notice provided by Grantee or 2) determined not to be economically feasible to rehabilitate to a condition in which the home is marketable to NSP Buyers. Unless otherwise agreed to in writing, Developer must fund the cost of demolition (if any) out of the NSP funding that is made available in the NSP Developer Agreement or the developer s own funds. B. Maximum NSP Expenditure per Dwelling Unit Developer must receive written approval of a property-specific Project Budget prior to any expenditure. The average NSP3 expenditure per unit will not exceed $150,000 and the maximum expenditure per unit will not exceed $177,594. These limits are governed by the County City Agreement and cannot be exceeded without prior written approval from the County. C. Maximum Development Subsidy per Unit The development subsidy per dwelling unit is defined as the amount of NSP-funded investment in excess of the market value that does not have to be recaptured from Developer or the homebuyer. See Section IX. of this Manual for more detailed requirements. Maximum mortgage assistance per buyer is set at S60,000. Maximum cash down payment assistance per buyer is set at S30,000. These limits are governed by the County City Agreement and cannot be exceeded without prior written approval from the County. 6

9 D. Developer Fee Allowed Per Dwelling Unit Amounts are established within the Agreement between Developer and Grantee. Developer will be procured using a Request for Proposals process which will result in a negotiated contract. Scoring of proposals will include costs and the final contract costs will be reviewed/negotiated by the Oversight committee and Consultant for appropriateness. E. General Contractor Fee Allowed All amounts are established within the Agreement between Developer and Grantee. All general contractors performing work on NSP-assisted projects must be properly licensed. Developer will be procured using a Request for Proposals process which will result in a negotiated contract. Scoring of proposals will include costs and the final contract costs will be reviewed/negotiated by the Oversight committee and Consultant for appropriateness. F. Allowed Sales Fee or Commission and Marketing Costs Amounts are established within the Agreement between Developer and Grantee. Developer will be procured using a Request for Proposals process which will result in a negotiated contract. Scoring of proposals will include costs and the final contract costs will be reviewed/negotiated by the Oversight committee and Consultant for appropriateness. G. Allowed Amount of NSP Homeowner Financial Assistance Per Buyer NSP Homeowner Financial Assistance per buyer cannot exceed the amounts and must conform to the terms described in Section XI in this Manual. Maximum mortgage assistance per buyer is set at S60,000. Maximum cash down payment assistance per buyer is set at S30,000. These limits are governed by the County City Agreement and cannot be exceeded without prior written approval from the County. H. Repayment of Net Proceeds of Sale Upon sale of an NSP-funded home, Developer will transmit the net proceeds of sale to Grantee. Net proceeds of sale are defined as follows: 1. The sale price of the home; 2. (Minus) the amount of any Homeowner Financial Assistance provided to buyer, as defined herein and described on the settlement statement; 3. (Minus) Developer costs of sale as documented by the settlement statement, including but not limited to real estate broker fees and seller-paid closing costs; 4. (Minus) The current fair market value of any real property contributed by Developer (e.g. a lot or home), in accordance with Section V below. (Developer cannot be reimbursed for NSP-funded acquisition costs.) 5. (Plus) Any reimbursements to Developer of costs previously paid or reimbursed with NSP funds, such as pro-rated taxes and assessments. 7

10 I. Reuse of Net Proceeds of Sale The amount of each repayment to Grantee of net proceeds of sale may be added to Developer s allocation of NSP funds and be available to Developer to perform additional NSP activities as approved in writing by Grantee during the period of performance in the NSP Agreement. After that period concludes, any remaining allocation to Developer will expire. Such additional allocation amounts are subject to recapture and reallocation by Grantee if Developer fails to perform in accordance with the agreed-upon delivery schedule. IV. Property Acquisition A. Eligible Properties Eligible properties must meet the following criteria: 1. Must be located in an NSP Target Area(s) indicated in the NSP Action Plan. 2. Must have no substantial adverse environmental factors as determined by an environmental review. See Section G below; 3. Must have Grantee s advance approval in writing for properties with more than one dwelling unit on site or where Developer proposes to acquire two or more small dwelling units to combine to create a more livable and marketable home; 4. Must otherwise be suitable locations for marketing and resale of homes to income-qualified homebuyers. 5. Must be unoccupied and have no personal possessions on site. If Developer discovers that a property is occupied or has personal possessions on site, Developer must immediately abandon the investigation and inform the seller that the property will not be considered for purchase. On an exception basis and only with advance written permission from Grantee, Developer may investigate an occupied property for possible purchase in the event of which Developer will be obligated to follow all relocation requirements described in Section IV below. 6. Must be in one or more of the following NSP property categories and only as indicated in the NSP Agreement. For example, Developer may not acquire a vacant or blighted property unless the Agreement allows acquisitions in that category. The developer will provide documentation verifying the status of the property and eligibility of the property category to the consultant prior to authorization for acquisition with NSP funds; a) Foreclosed: The property is at least 60 days delinquent on its mortgage and the owner has been notified; or the property owner is 90 days or more delinquent on tax payments; or under state or local law, foreclosure 8

11 proceedings have been initiated or completed; or foreclosure proceedings have been completed and title has been transferred to an intermediary aggregator or servicer that is not an NSP grantee, subrecipient, developer, or end user. when; b) Vacant or Abandoned: A home or property is vacant or abandoned mortgage or tax foreclosure proceedings have been initiated for that property, or no mortgage or tax payments have been made by the property owner for at least 90 days, or a code enforcement inspection has determined that the property is not habitable and the owner has taken no corrective actions within 90 days of notification of the deficiencies, or a property has had a structure at some time in the past but currently does not have any improvements, or, the structure has been unoccupied for at least 90 days and has no bona fide tenant with rights of occupancy. c) Blighted: A structure is blighted and qualified for demolition with NSP funds when it exhibits interior and/or exterior signs of deterioration sufficient to constitute a threat to human health, safety, and public welfare. To be considered blighted under the terms of any NSP Agreement, the appropriate public entity with jurisdiction must declare the structure blighted. 7. Must be acquired with a valid deed free and clear of all encumbrances. Purchases with any other form of deed or with any lien, deed restriction, land lease or other encumbrance must be approved in writing by Grantee prior to Developer making an offer. B. Acquisition Objectives for Serving Households at or Below 50% of Area Median Income (AMI) The NSP program requires that Grantee spend at least 25% of its NSP award on developing homes and rental units that are reserved for households at or below 50% of AMI. Grantee, in turn, has given quotas for such units to some of its NSP Developers that may be smaller or larger than 25% of the funding allocation to the Developer. Developer s quota, if any, is stated in Developer s NSP Agreement. Because it is crucial that Grantee meet the overall requirement, Developer must designate specific properties being acquired as restricted to future occupancy by households at or below 50% of AMI. Further, Developer must give priority to acquiring homes for households at or below 50% of AMI as stated in the NSP Agreement.. C. Property Investigations Developer is responsible for property investigations and will recoup the costs of investigations through a developer fee, if such fee is indicated in the NSP Agreement. Developer will identify potential properties for acquisition by researching public records, obtaining proprietary data 9

12 about recent and pending foreclosures, contracting with real estate brokers and/or other effective methods. Prior to making an offer, Developer will complete the following tasks and review documentation with the Consultant: 1. Inspect the site conditions and structures and complete a preliminary rehab/construction cost estimate in format that is acceptable to the Grantee; 2. Complete a Project Budget that includes all proposed NSP-funded expenses for acquisition, site work, rehab/construction, holding costs, marketing/sales costs, closing costs, developer fee, and other soft costs; 3. Obtain a full URA-compliant independent appraisal indicating the as-is market value of the property to determine the cost-reasonableness of the asking price or proposed offer price and for the purpose of verifying the sale price is at least 1% below market value. 4. Verify and document in a property file that the property is vacant and has no personal possessions onsite. Documentation should include a signed and dated inspection report, photos, and notes from interviews with neighbors (if available) indicating the approximate last date of occupancy. If information from neighbors is not available, documentation should include data from a utility company or the Post Office indicating the date of terminating service. The seller must complete a form stating that the property meets all requirements of the URA. See Section IV regarding relocation requirements and protections for tenants in occupied properties; 6. If an occupied property is pursued (ONLY with Grantee s written approval), send occupants who may be displaced a General Informational Notice (GIN) as required by the Uniform Relocation Act (URA). A GIN informs such persons that in the event they are displaced by this project they may be eligible for relocation assistance and payments under the URA (and/or in some cases section 104(d) relocation assistance). GINs should be provided to property occupants early in the property acquisition process and prior to making an offer. Complete a relocation plan prior to making an offer; 7. Comply with federal Recovery Act protections for bona-fide tenants of residential properties foreclosed upon on or after February 17, These requirements directly affect initial successors in interest (ISII) who take title to the property through foreclosure (including lenders and others who purchase property at foreclosure sales). If Developer or Grantee knows that the ISII did not comply with the NSP tenant protections and vacated the property contrary to Recovery Act requirements, abandon the transaction or find an alternative source of funds. NSP funds cannot be used for such properties. 10

13 D. Grantee Approval of Property Acquisitions or Contributions of Developer-Owned Properties Developer will follow these procedures in order to obtain Grantee s approval prior to acquiring properties for this program or contributing properties to this program. 1. Transmit electronically a property information package to Consultant that includes the following; a) A detailed rehab work write-up and cost estimate, or new construction plans, material specifications and cost estimate. New construction cost estimates may be based on the plans for one of Developer s standard new home products, which may be substituted later with other plans with Grantee s written approval. Rehab and new construction estimates will include a contingency line item of 5% - 20%. The amount of contingency will be based on needs of the specific property or project and the amount will be subject to grantee approval. b) A development description and Project Budget in spreadsheet form with backup documentation as agreed upon. See draft budget worksheet in appendix 6. c) A preliminary appraisal indicating the as-is property value. c) A complete copy of the draft Purchase Agreement with the NSP-required conditional purchase agreement addendum. See Appendix 5 for the approved language, which makes the offer conditional upon an approved environmental review and the contract price being at least 1% less than market value as indicated by an appraisal to be obtained by Developer. If the agreement calls for Developer to pay for taxes or other liens or assessments in arrears, those amounts must be added to the contract price for purposes of calculating the discount from market value. d) A copy of the Notice of Voluntary Acquisition that will be transmitted to the seller. See Appendix 7 for an example of this form f) Evidence that the property is foreclosed, abandoned or vacant. E. Properties with Primary Structures Requiring Demolition Written advance permission of Grantee must be obtained before offers may be made on properties on which the primary structure is blighted or beyond repair and therefore requires demolition. Deteriorated accessory buildings that may require demolition must be included in the work write-up and cost. Upon Grantee approval of project work write-ups or plans and specifications, these accessory buildings may be demolished. 11

14 F. Purchase Offers Developer will manage purchase offers as follows: 1. Obtain written approval via or hard copy from Grantee (thru the Consultant) before presenting the offer. 2. Transmit signed Notice of Voluntary Acquisition to seller. 3. Execute and transmit purchase agreement to seller with the required addendum (see appendix 7). Include with the transmittal a Seller Certification Form to be executed by the seller. See Appendix 7. If the seller will not execute the certification form, assure that other due diligence is completed in accordance with Section 3(d) to determine that the property does not have a bona fide tenant. G. Environmental Review Grantee, thru the administrative Consultant, is responsible for completing Tier 1 environmental assessments of NSP target areas. Developer will complete a Tier 2, sitespecific environmental review, using the following steps: 1. Review Tier 1 Environmental Review. 2. Complete the Grantee s approved ER form for specific property 3. Complete consultation as necessary including Section 106 Review 4. Evaluate mitigation options 5. review mitigation recommendations with Consultant 6. Submit the completed ER form (including all written comments, consultation and 106 clearance letter from the SHPO) to Consultant for approval 7. Consultant submits ER recommendation to Oversight committee for determination and if approved, submits combined notice advertisement to Clerk Treasurer for publication. 8. Consultant transmits determinations and RROF to County Administrator for transmittal to HUD 3. When Grantee has given written approval or denial of the ER, inform the seller. If the ER is denied, abandon the transaction. Approval must be obtained before closing the purchase of the property. H. Appraisals Developer will obtain appraisals as follows: 1. As-is appraisal of foreclosed properties: For any foreclosed property being acquired by Developer pursuant to an NSP Agreement, obtain a full URA compliant appraisal of as-is market value in order to determine if the contract price is at least 1% lower than appraisal. If the appraisal was completed prior to making the offer, it may not be more than 60 days old at the time that the purchase agreement is 12

15 executed. This appraisal is in addition to any preliminary or internal appraisal completed during the initial property investigation, unless a full appraisal was performed at that time and the full appraisal is not more than 60 days old at the time that the purchase agreement is executed. 2. After-construction/rehab appraisal: For any NSP property that will be developed and sold to owner-occupants, Developer will obtain an after-rehab or afterconstruction appraisal of market value. This appraisal will be used to establish the sales price of the home, as described in Section I below, and may be completed at any time prior to the home being priced and offered for sale. I. Closings The following procedures will be followed for closings on properties acquired by Developer: 1. Obtain a title policy binder for the property. 2. Complete legal review and approval of the closing documents. 3. Prepare an Acquisition Draw Request for Grantee and transmit to Grantee along with an electronic copy of the property appraisal. 4. When the draw request has been approved by Grantee and submitted through the DRGR system, schedule the closing; the Draw Request must be submitted at least 10 days prior to the scheduled closing date. Draw requests first have to be processed by Grantee internally, then require three to four days to process with HUD. Then, the Grantee and Developer should make best efforts to expend the NSP funds within three days of receipt but in no case more than 10 days. Therefore, the number of days in advance of closing is based on Grantee s internal processing time, plus an estimated four days to process and receive the NSP funds, then spending the funds at the closing within three additional days. 5. Confirm that Grantee has wired or otherwise paid the required funds into an escrow account for the closing; 6. Execute a promissory note and mortgage deed (or deed of trust) in favor of Grantee for an open-ended amount, with the maximum amount equal to the projected NSP funding described in the Project Budget or other amount approved by Grantee. When the closing is completed, assure that grantee receives copies of the deed and settlement sheet. If Grantee has agreed in advance to a purchase, subject to Developer s payment for liens or other encumbrances, copies of all documents justifying those payments must be transmitted as well. 13

16 V. Properties Contributed by Developer Developer may contribute to an NSP project a property owned by Developer only as specified in the NSP Agreement. If such contributions are allowed and Developer proposes to be paid for the contribution from the sale proceeds of the redeveloped property, Developer must obtain an independent full appraisal of the property s market value at Developer s cost and transmit it to Grantee. If Grantee deems the appraisal acceptable, Developer may include the appraised value in the Project Budget and be funded for that cost when the home is sold, to the extent that proceeds of sale are available. Grantee at its sole discretion may obtain another appraisal at its cost and determine a reasonable value for the contribution of the property. VI. Relocation of Occupants and Tenant Protections It is the intent of the Grantee to reject projects which may involve relocation or displacement of bona fide occupants. Any such projects contemplated by the developer must be authorized in writing and in advance of any offers to acquire properties using NSP funds. Federal Uniform Relocation Act requirements must be followed in the event that Developer acquires an occupied property either inadvertently or with the advance permission of Grantee. In such events, Developer will be required to conduct a survey of occupant(s), create a relocation plan, provide a relocation notice and if the occupant is qualified give financial assistance in accordance with URA and HUD rules. In addition, Developer must observe all requirements of federal laws protecting tenants who reside in properties foreclosed on or after Feb. 17, 2009, including without exception allowing a bona fide tenant to remain in residence for the term of the lease or 90 days, whichever is longer. VII. Rehabilitation, New Construction and Reconstruction A. General Responsibilities Respective responsibilities of Developer and Grantee are as follows: 1. Developer shall be responsible for preparing plans and specifications (or work write-ups) that conform to program rehab/construction standards (see Appendix 8), estimating rehab/construction costs, managing contract awards, and managing the construction process. Developer assumes all risks of cost overruns in excess of the construction and contingency budget line item in the previously approved Project Budget, unless Grantee (represented by the Oversight Committee) approves a revised Project Budget. 2. Grantee (represented by the Oversight Committee) is responsible for approval of project, providing and interpreting Rehab/Construction Standards; approving plans, specifications and estimates for projects; monitoring the work; and approving draw requests. 14

17 B. Plans and Specifications Developer is responsible for completing plans and specifications (or work write-ups) which conform to Grantee s Rehab/Construction Standards and which are in a form approved by Grantee. See Appendix 7. Plans/specifications and work write-ups will include the following: 1. General requirements for which the builder is responsible (permits, fees, mobilization, site utilities, site security, builder s risk insurance, homebuyer warranty, etc.); 2. Site plans, if new structures, fencing, landscaping or other site improvements are being provided; 3. Working drawings and materials specifications, for any new construction or substantial rehabilitation; 4. Rehab work write-ups that show quantity, size, and materials specification for each work write-up item to enable Developer to create accurate cost estimates. 5. For structures built before 1978, the plans and specifications must address remediation of any lead paint and must include provisions for post rehab environmental hazard clearance certifications according to HUD NSP guidelines. C. Cost Estimates Developer is responsible for producing cost estimates including builder overhead and profit in a form approved by grantee, as follows: 1. Rehab cost estimates will be completed in a line-item, work write-up format with one work item per line unless an alternative form of estimate is approved in writing by Grantee; 2. Cost estimates for construction of new structures and substantial rehabilitation will be based on take-offs from the working drawings of the quantities of materials and labor required or compilations of costs for similar and recently-built or renovated structures; 3. Site improvement cost estimates will be completed for each improvement and based on take-offs of quantities of materials and labor required; 4. The cost estimate will be used to determine the cost reasonableness of bids. The Developer may obtain bids informally, utilizing internal processes; however, the Grantee expects Section 3 and local contractors to be utilized wherever possible. The Contractor shall provide names, addresses, and bid amounts for bids received to the Grantee upon request; 5. Work to be completed by Developer acting as general contractor. The 15

18 cost estimate for each NSP project must be reviewed by Grantee to determine costreasonableness and approved by Grantee. When approved, the cost estimate becomes a schedule of values which is used by Grantee s construction inspector (the Nappanee Building Inspector) to determine the value of work completed for the purpose of approving draw requests. D. Construction Monitoring Inspections The Grantee s and Developer s roles and responsibilities are as follows: 1. Developer is responsible for monitoring the quality, completeness and conformity to specifications of all work performed by third party contractors, and--if Developer is also the general contractor--all work performed by Developer s personnel or subcontractors; 2. The City Building Inspector, or the consultant should accompany Developer s representative in all construction meetings, construction draw inspections, and the punch list inspection. Representatives of the Oversight Committee shall have access to all such meetings for their convenience and to ensure open and timely communication throughout the process. Grantee may approve draw requests or deny all or a portion of a draw request for cause. E. Construction Draws Construction draw requests will be presented to Grantee in a form approved by the grantee along with lien waivers and any other required attachments described on such form. Construction draw requests may include requests for reimbursement of soft costs in the approved Project Budget, up to the aggregate total amount of the line item budget amounts for construction and soft costs. See Section VIII for additional requirements for draws of NSP funds. Grantee is responsible for reviewing, approving and processing draw requests in a timely manner. F. Change Orders Developer may approve change orders up to a combined amount equal to the rehab/construction contingency budget line item. Developer is responsible for all construction costs exceeding the contingency budget amount, unless Grantee at its sole discretion approves a revised construction budget and Project Budget and reviews and approves a change order for additional scope of work and costs in excess of the total construction budget. G. Punch List, Final Inspection and Final Draw Developer s and Grantee s representatives must jointly approve the punch list during or immediately after the punch list inspection and approve the clearing of punch list items after subsequent inspection(s). All punch list items reasonably required by Grantee must be included. Upon satisfactory completion of the punch list items, and all applicable paperwork, Grantee will issue a notice of final completion to Developer. The final draw will include the payment of any remaining eligible construction costs, construction retainage, applicable soft costs and the portion of the developer fee payable upon completion of construction. 16

19 VIII. Funding of Construction Work and Soft Costs NPS funds are available for funding the construction work and soft costs that are indicated in the Project Budget, up to the NSP funding amounts stated in the Project Budget. Developer is responsible for obtaining other funding indicated in the Project Budget and any additional funding required in the event that costs exceed the total amount of the Project Budget. Developer will follow these procedures with draws of NSP funds: A. Fees and Interest Payments Fees and interest payments for lines of credit and construction loans are not eligible costs for reimbursement by Grantee with NSP funds and will not be counted toward the total cost basis of the redevelopment of the property. Grantee s intent is to pay for these costs indirectly through payment of the developer fee. B. Construction Costs Construction costs will be funded by Grantee as follows: 1. If all construction work is carried out by a general contractor or multiple contractors, contractor(s) will prepare a draw request or invoice which indicates a 10% retainage. The aggregate retainage amount for a contractor will be included in contractor s final draw request or invoice, which will be presented to Grantee after final completion of the project; 2. If Developer is also acting as general contractor, Developer will follow any special requirements in the NSP Agreement for charging general contractor fees and nonsubcontacted construction costs, as well as processing draws. In addition, there will be a 10% retainage for all general contractor and subcontractor costs for each draw, including a retainage on any general contractor fee. The aggregate retainage amount for the general contractor and subcontractors will be included in contractor s final draw request or invoice, which will be presented to Grantee once the punch list has been completed. 3. Requests for NSP funding of soft costs must be accompanied by invoices or other documents from subcontractors or other third parties indicating payment of eligible rehab/construction and soft costs as indicated by the line items in the Project Budget. 4. Developer fees will be paid in three installments as indicated in the NSP Agreement upon acquisition, completion of rehab/construction, and sale of the home. Developer will submit an invoice to Grantee for the fees due upon acquisition and completion of rehab/construction. Developer will be paid the third installment of the developer fee from the proceeds of the sale after the sale has closed and Developer has provided to Grantee all required documentation regarding the project, the buyer s eligibility and the sale. 5. The terms of the NSP Agreement determine whether the Developer Fee is calculated as a fixed dollar amount or a percentage of total development costs, not including the fee. However, if the fee is calculated as a percentage, once calculated in the original Project Budget, the fee amounts will be fixed dollar amounts. If actual total project costs exceed or are less than the budgeted amounts, the developer fee will remain the same. 17

20 IX. Pricing of Homes and Development Subsidies: Developer will set an asking price for NSP homes that is the lesser of the after-construction/ rehab market value, or total development costs. A. After-Construction/Rehab Market Value Developer will obtain an after-construction/rehab appraisal as described in Section H above. This appraised value will be the asking price for the home unless it is higher than the estimated total development cost of the home, in which case the price will be the same amount as the total development cost. Total development cost includes all acquisition, rehabilitation/construction and soft costs including the developer fee and any costs of providing down payment and closing cost assistance regardless of the source of funds. B. Adjustments in Asking Price If no qualified offer is received within 60 days of first marketing a home, Developer may reduce the asking price by 5%. If no qualified offer is received after final completion followed by 60 days of best efforts in marketing a home, Developer may reduce the original asking price by up to 10%, including previous adjustments, if any. Developer may make additional price reductions only with the written approval of Grantee. In any case, Developer may reduce asking prices only after making diligent and continuous efforts to market and sell a home. C. Setting and Adjusting the Contract Price In executing a home sales agreement, Developer may not agree to a contract price that is less than the amounts described above without the written approval of Grantee, except that Developer may amend the contract price in a home sales agreement to be equal to the market value of the home as determined by a first mortgage lender s appraisal. D. Adjustment in Contract Price For purposes of NSP compliance, any such reduced prices shall be considered to be the current market value of the home, regardless of the value determined by any prior appraisal. Note that no NSP Home can be sold for more than the total development cost, per NSP rules. E. NSP Development Subsidy When Investment Exceeds Market Value When development costs exceed market value, the portion of NSP funds advanced to the project that are above the market value become a development subsidy to the project. Neither the Developer nor the homebuyer is required to repay NSP funds used for an approved development subsidy. (However, the homebuyer will be subject to recapture provisions for the amount of any Homeowner Financial Assistance as defined herein which subsidizes the contract price of the home and possibly closing costs as well.) 18

21 F. Determining Market Value, to Establish the Development Subsidy The development subsidy is calculated with the following formula, according to the HOME program rules that are referenced as a safe harbor for the NSP program. Total development cost (Minus) current market value (Equals) the development subsidy If an NSP home is sold for a price equal to the after-construction/rehab appraised value, then the appraised value is deemed to be market value. Moreover, if the price of a home has been reduced due to a lack of qualified offers after adequate marketing and sales efforts over a reasonable period of time (as described above), the reduced selling price will be considered market value for purposes of calculating the development subsidy. G. Accounting for Expenditures Developer will account for total NSP expenditures per home by means of assigning an accounting code for NSP-funded or reimbursed expenses for each property and another accounting code, if applicable, for non-nsp funded expenditures (if any). At the time of the sale of an NSP-assisted home, Developer will provide Grantee with a complete accounting of NSP expenditures for that home and non-nsp expenditures, if any. The separate accounting of NSP and other funds used is required for establishing the maximum allowed sale price and will provide necessary financial data on NSP-funded expenditures in the event of a HUD audit of program activities. H. Possible Adjustments in Price at Time of Sale Prior to closing any sale of a property, after actual total development cost is calculated as described above, and the first mortgage lender s appraisal has been received by Developer, the sale price must be reduced to the lesser of the following two amounts if less than the contract price: 1) the actual development costs, or 2) the amount of the first mortgage lender s appraisal. X. Marketing and Sales of NSP Homes A. Responsibility for Marketing and Sales Developer is fully responsible for marketing NSP homes and selling them to qualified buyers. If an NSP home does not sell in a timely manner and this results in cost overruns that cannot be paid out of contingency funds, Developer will be responsible for paying the additional costs unless, at the sole discretion of Grantee, the Project Budget is revised to provide additional NSP funding. B. Marketing Plan and Budget Prior to marketing the first completed home, Developer must obtain written approval from Grantee for a program marketing plan and budget. The marketing plan will include the following elements: 19

22 1. Methods of affirmative outreach to residents of target areas; 2. Other means of advertising homes for sale, including such means as Multiple Listing Service, advertising, flyers, etc.; printed materials and advertisements must include equal opportunity language; 3. Approved language for use in flyers, advertising and listings regarding income qualifications of buyers and NSP financing being offered to buyers; 4. Method and timing of prequalifying prospective buyers, in terms of NSP income eligibility and eligibility for mortgage financing; 5. Policy for managing a waiting list of potential buyers; 6. Sample disclosure statements to be given and explained to buyers prior to signing purchase agreements and at closing; 7. Sample form of purchase contract. 8. Provisions for establishing and adjusting sale prices that reflect the provisions of Section 1 of this Manual. XI. Homebuyer Application and Prequalification Developer is responsible for the following tasks except that tasks A through I may be completed for some or all clients by a pre-purchase counseling agency under contract to Grantee to assist prospective NSP homebuyers. To the extent that prequalification tasks are completed for a prospective buyer referred by such agency, Developer will obtain documentation that the tasks were properly completed. Developer must keep documents on file and transmit electronic copies to Grantee s Consultant prior to entering into a home sales contract with a Buyer. The Consultant will review documentation of Homebuyer income eligibility to assure compliance with NSP program requirements. A. Application for NSP Assistance Before a prospective buyer is referred to counseling or to execute a sales agreement for an NSP-assisted property, the buyer must complete an Application for NSP Assistance. Attached in Appendix 9 is a draft application. The information obtained in the application will be used-- along with verifications--to determine a buyer s eligibility to purchase an NSP home and to receive NSP Homeowner Financial Assistance. While online and paper forms may be filled out in advance by Applicants, the application will be completed in a face-to-face meeting with a qualified representative of Developer. B. Evidence of Employment, Residence, Income and Assets Developer will require Applicants to bring this evidence to the intake and application interview in order to make an initial determination of eligibility. 20

23 C. Credit Report During the intake interview, Developer will obtain, with the Applicant s written permission, a credit report that includes a credit score. Developer will review the report with Applicant and explain any positive or negative data with regard to qualifying for purchase of an NSP home. D. Prequalification for First Mortgage Loan Developer will determine whether buyer appears to be qualified to obtain a first mortgage loan, based on the Buyer and co-buyer s income, employment history, credit scores and other factors. Developer is expected to coordinate with, and rely upon, lending institutions to determine whether or not an Applicant has sufficient income to obtain a first mortgage loan in the minimum amount necessary to purchase an NSP Home from Developer. An Applicant whose application fails to meet a lenders prequalification standard will be given a written notice of denial per lenders standard procedures. E. Certifying the Income Eligibility of Prospective Buyers Developer will use the methods described in NSP3 regulations to verify and certify the income-eligibility of prospective buyers. Required documentation (copies of driver s licenses, paystubs, etc.) will be kept in Developer s files and copies sent to Grantee/Consultant as described in Section S of this Manual. The income certification may be no more than six months old at the time that the buyer and Developer enter into a purchase agreement. If older, the buyer must be recertified. An Applicant whose application fails to meet the NSP eligibility requirements will be given a written notice of denial as described in Section H, below. F. Prequalifying for NSP Homeowner Financial Assistance Prior to referring prospective buyers for counseling, Developer will complete the income certification described in E, above, and determine buyers eligibility for NSP Homeowner Financial Assistance. Homeowner Financial Assistance will be provided in the form of a soft 2 nd mortgage to bridge the Gap between the approved sales price and buyer funds from the first mortgage and down payment. Maximum total assistance to be provided is as follows: Buyer Household Income Assistance Amount Up to 50% AMI Up to $90,000 51% to 60% AMI Up to $85,000 61% to 70% AMI Up to $80,000 71% to 80% AMI Up to $75,000 81% to 90% AMI Up to $70,000 91% to 100% AMI Up to $65, % to 110% AMI Up to $60, % to 120% AMI Up to $55,000 NSP Buyers can use NSP Homeowner Financial Assistance to fund closing costs and up to half of the required down payment amount, so long as they provide a minimum amount of cash for the down payment or closing costs as an investment at risk in the property. However, see special considerations below regarding FHA financing, which does not allow the Developer to provide down payment assistance in any amount. 21

24 Buyer Household Income Minimum Cash-to-Close Requirement Up to 80% AMI $ % to 100% AMI $ % to 120% AMI $2,000 In most cases the Homeowner Financial Assistance will not require additional advances of NSP funds. It is expected that the amount of NSP investment in a home prior to sale to homeowners will equal or exceed the Homeowner Financial Assistance. In other words, Homeowner financial Assistance is a paper transaction at settlement which will not require additional cash. Any proposed additional Homeowner Assistance will require approval from the City prior to closing. Special considerations if FHA financing is being used by a buyer: If the buyer is using FHA financing, the Developer is not allowed to provide any amount of down payment assistance, even though the Developer can finance closing costs if they do not exceed 6% of the sales price. Closing costs include reasonable fees allowed by the FHA lender, prepaid taxes and insurance, recording fees and the up-front mortgage insurance premium. Non-FHA lenders may have fewer restrictions or additional restrictions that the Developer will have to comply with when providing down payment and closing cost assistance. Non-profit Developers working in the NSP program are required to register and be approved to make second mortgages, pay closing costs, or other forms of NSP Homeownership Assistance in conjunction with FHA insurance. (For-profit developers may not offer financial assistance under FHA.) FHA is working on ways to streamline the process. G. Disclosures at Time of Application Unless an Applicant is disqualified during the intake interview, he or she will be given hard copies of preliminary disclosure documents that provide the following: 1. An explanation of the NSP program in general terms and its benefits to buyers and the community. 2. A good faith estimate of the general locations and price ranges of NSP Homes that may be available for Buyers to purchase, and a good faith estimate of typical buyer-paid closing costs. 3. The NSP application approval criteria. 4. Waiting list policies. 5. The requirement for attending pre-purchase counseling (if approved). 6. Applicant s household size and estimate of monthly income, with a statement that the income amount must be verified prior to the Applicant being approved for NSP assistance. 22

25 7. A good faith estimate of the amount (or range of amounts) and terms of Homeowner Financial Assistance that Applicant may qualify for, based on an analysis of Applicant s financial and other data provided. 8. A general description of an NSP buyer s obligations for repayment of subsidies, and resale controls on homes sold (if any). During the intake interview or subsequent face-to-face meeting, a representative of the developer will review these disclosures with the Applicant and be available to answer questions about them. No application can be approved unless disclosures have been made as required. H. Notification of Approval or Denial Upon completion of the tasks described above, Developer will inform buyers in writing of their eligibility or ineligibility for NSP assistance, conditional upon completion of homebuyer education and training, signing a purchase agreement for an NSP home, obtaining first mortgage financing, and providing the required minimum down payment amount. The written notification will include the amount or range of amounts of NSP financial assistance that buyers qualify for and preliminary disclosures of the terms of that financial assistance. I. Confidentiality of Client Data Developer and Consultant will observe all Privacy Act requirements and keep client data in locked file cabinets or password-protected electronic files. XII. Homebuyer Counseling and Education A. Referral to Counseling and Education Program Upon notification of approval of an application for assistance, buyers will be referred to a Grantee-approved and HUD-approved program that offers at least eight hours of pre-purchase counseling and education. If buyers have already completed such a program, Developer must determine if the program meets Grantee and NSP requirements and must verify completion by obtaining and filing a certificate of completion. If the pre-purchase counseling and education does not meet requirements, buyers will have to complete training delivered by a HUDapproved counselor. B. Certificate of Completion Upon successful completion of a counseling and education program, Buyers will receive a certificate of completion. No buyers will be allowed to sign a sale agreement for an NSP home unless the completion of counseling and education has been verified by Developer and a copy filed in Developer s records. 23

26 XIII. Waiting List A. Requirements for Waiting Lists Developer must establish and maintain a waiting list of all prospective homebuyers who are approved for assistance. Grantee may waive or amend this requirement at its sole discretion if Developer demonstrates conclusively that a waiting list serves no purpose, because of a market imbalance (ex: homes available for sale exceeds the number of qualified buyers). The Consultant shall be provided with a copy of the waiting list and be provided with timely updates (via ) of additions/changes. B. Waiting List Procedures Developers will follow these procedures. 1. Priority for selecting a completed home will be determined by the date that a client s application for assistance was approved (that is, the client with the earlier date of approval shall have priority for selection.) 2. As a home or group of homes becomes available for sale, the home(s) will be offered first to the client with the highest priority, and if not selected, then to the client with the second highest priority, etc. 3. Homes will only be offered to a client only if the prices are affordable to the client as determined by the program underwriting analysis Performed by the Developer. 4. Each client will have three opportunities to reject a home or groups of homes offered and maintain his or her priority. After a third rejection, a client s priority will fall to the bottom of the waiting list. XIV. Executing Sale Agreements with Buyers A. Requirement for Using Approved Sales Agreement Developer will use only a form of sales agreement approved by Grantee. The sale of the home will be conditional upon the Buyer obtaining a first mortgage loan (or deed of trust loan) from a lender offering a conventional or government-insured, home purchase loan. Unless otherwise approved by grantee, terms shall be for a fixed-rate for years and carry an interest rate commensurate with market rate loans available. B. Commitment letter for NSP Financing Simultaneous with executing a purchase agreement, Developer will issue a commitment letter for the exact amounts, or maximum amounts, of NSP Homeowner Financial Assistance that Buyer will be provided if the sale is completed. The commitment letter is intended, in part, to aid Buyer in obtaining a first mortgage loan. If an Applicant has not met all of the requirements for purchase, the commitment letter should be conditional upon meeting such requirements. The commitment letter will also be conditional upon no substantial changes occurring in the NSP Buyer s employment or financial status at the time of closing. 24

27 C. Disclosure Statement Prior to executing a sales agreement, Developer will provide the NSP Buyer with a second disclosure statement. (See Section XI.G regarding the first disclosure statement.) The second disclosure statement will reiterate the requirement for Buyer to attend pre-purchase counseling, with a check-off indicating whether Developer has a certificate of completion on file. The statement will also describe, the availability and terms of Homeowner Financial Assistance, obligations for repayment of subsidies, and resale controls on homes sold (if any). During the intake interview or subsequent face-to-face meeting, a representative of the developer will review these disclosures with the Applicant and be available to answer questions about them. No application can be approved unless disclosures are made as required. XV. Home Sale Closing Requirements A. Originating the Subsidy Recapture Lien Documents The amount of Homeowner Financial Assistance provided to a Buyer as provided in this Manual will be secured by a promissory note and mortgage with Grantee named as lien holder at 0% interest. All payments of principal will be deferred until buyer sells the home, transfers it, or violates the terms of the lien. At least seven working days prior to each closing of an NSP Home sale, Developer will prepare and forward to Grantee a promissory note, mortgage deed (or deed of trust), and accompanying disclosure statement, allowing three working days for Grantee to review the document and transmit it to Developer s attorney. Developer will use forms approved by Grantee. Grantee will review and approve the language and numbers inserted in the forms. The amount of the lien will be the amount of Homeowner Financial Assistance provided for in the Buyer s Commitment Letter, as originally provided or amended. The dated and signed Commitment Letter will be attached to the lien sent to Grantee for approval. B. Closing Responsibilities In addition to having the responsibilities described above, Developer will retain a closing agent and an attorney for Developer s own legal review of closing documents. Developer s attorney will have the final responsibility for review of closing documents on behalf of Developer, while ensuring compliance with Grantee s requirements. XVI. Post-Purchase Counseling A. Developer Responsibility Developer is responsible for notifying Buyers of the availability and advisability of using post purchase counseling if they are unable to make a first mortgage payment on time. This notification will be included in the Commitment Letter and language of disclosure documents provided at the closing of the home sale. The information will stress the importance of 25

28 seeking help before or immediately after a late payment might occur and include the name or names, address(es) and phone number(s) of Grantee-approved counseling agencies. A list of HUD approved Counseling Agencies is attached as appendix 10. B. Grantee Responsibility Grantee is responsible for identifying counseling agencies that can be reasonably expected to provide reliable post-purchase counseling at low cost or no cost due to current or anticipated public or private funding for that purpose. XVII. Management of Excess Revenues, Liens and Resale Controls A. Net Proceeds of Sale The requirements for disposition of net proceeds of sale are described in Section III. B. Repayments of Homeowner Financial Assistance According to the terms of this Manual, all liens will be in the name of Grantee. Grantee will be solely responsible for managing liens resulting from sales of NSP Homes by Developer, including but not limited to managing receivables, accounting for payments, approving subordinations (if allowed), and issuing lien releases. XVIII. Reporting and Recordkeeping Requirements - Reporting and Recordkeeping requirements shall be transmitted to grantee from the Developer on forms and at intervals approved by the Grantee. 26

29 Definitions Abandoned - refers to homes where no mortgage or tax payments have been made by the property owner for at least 90 days or a code enforcement inspection has determined that the property is not habitable, and the owner has taken no corrective actions within 90 days of notification of the deficiencies. Action Plan refers to the Elkhart County NSP3 Action Plan Appraisal - means an appraisal which meets the criteria specified in the Uniform Relocation Assistance and Real Property Acquisition Policies Act ( URA ), as further defined in 49 CFR Applicant: A person or persons who have applied to Developer for approval of an NSP home purchase and Homeowner Financial Assistance. Area Median Income means median income (as reported by HUD) for households in Elkhart County IN. Blighted Structure - means a structure that exhibits objectively determinable signs of deterioration sufficient to constitute a threat to human health, safety, and public welfare. Community Development Block Grant Act - means the Housing and Community Development Act of 1974, Pub. L. No , as amended. Unless otherwise noted in HERA (as amended) and the alternative requirements in the NSP Notices, NSP is governed by the CDBG regulations. Current Market Appraised Value - means the value of a property that is established through an appraisal made in conformity with the appraisal requirements of the URA at 49 CFR and completed within 60 days prior to a final offer made for the property by the CITY, developer, or individual home buyer; provided, however, if the anticipated value of the proposed acquisition is estimated at $25,000 or less, the current market appraised value of the property may be established by a valuation of the property that is based on a review of available data and is made by a person the CITY (with COUNTY approval) determines is qualified to make the valuation. Developer: An NSP developer subject to an NSP Agreement funded by an NSP project. Dodd-Frank Act - Wall Street Reform and Consumer Protection Act of 2010 ( Public Law ; 7/21/2010), Eligible Costs - means costs for the activities specified in of this Agreement for which NSP funds are budgeted, provided that such costs (i) are incurred in connection with any activity which is eligible under HERA and Section 105A of Title I of the CDBG Act, and (ii) conform to all NSP3 requirements. Environmental Requirements - means the requirements described in 24 CFR Part 58.

30 Foreclosed - refers to a property that is at least 60 days delinquent on its mortgage and the owner has been notified; or the property owner is 90 days or more delinquent on tax payments; or under state or local law, foreclosure proceedings have been initiated or completed; or foreclosure proceedings have been completed and title has been transferred to an intermediary aggregator or servicer that is not an NSP3 grantee, the CITY, developer, or end user. Grantee: The City of Nappanee as Sub-recipient of Elkhart County, Indiana Housing and Economic Recovery Act of 2008 (HERA) - means the Neighborhood Stabilization Program (NSP) found in Title III of Division B of the Housing and Economic Recovery Act of 2008, as amended which made $3.9 billion in funding available to cities, counties and states to counter the effects of excess foreclosed housing units and neighborhood deterioration. These funds were designated as Neighborhood Stabilization Program (NSP) Home(s) - HUD interprets homes as any type of permanent residential dwelling unit, such as detached single family structures, townhouses, condominium units, multifamily rental apartments (covering the entire property) and manufactured homes where treated under state law as real estate (not personal property). Low-Moderate Median Income - a HUD-defined term incorporating households with eligible incomes at or below 120% of area median, based on household size and county, including low-, moderate-, and middle-income, in referring to the national objective of the CDBG program. Low-Income Set-Aside - refers to the NSP requirement that not less than 25 percent of the NSP3 funds to the COUNTY shall be used for the purchase and redevelopment of abandoned or foreclosed upon homes or residential properties that will provide permanent housing to individuals or families whose incomes do not exceed 50 percent of area median income. Minority and Women s Businesses is a business which has successfully registered with the State of Indiana s MBE/WBE registry. NSP: The Department of Housing and Urban Development (HUD) s Neighborhood Stabilization Program, established by the Dodd-Frank Act - Wall Street Reform and Consumer Protection Act of 2010 ( Public Law ; 7/21/2010) NSP Agreement: An agreement entered into by Grantee and Developer for the purpose of funding and carrying out NSP-eligible activities on one or more NSP-eligible properties. NSP Buyer: The buyer of an NSP Home. NSP Property: A property that is rehabilitated, newly constructed or reconstructed pursuant to Developer s agreement with Grantee. NSP Home: An NSP property that is being sold to an owner-occupant. NSP Program Budget: The budget attached to an NSP Agreement showing projected development costs and funding for Developer s entire NSP program in the aggregate. PROJECT - means the activities described in the Action Plan and within the Agreement which are to be carried out to meet the objectives of the NSP3 Program.

31 Project Budget: A budget for all acquisition, rehab/construction and soft costs for a particular home that Developer must submit to Grantee prior to committing to purchase any property for use in the NSP program. Project Funding: Any and all governmental and private funds, including Developer s cash, used to pay for the costs to carry out the redevelopment of a single NSP-assisted property. Program Income - means the NSP3 portion of any proceeds received by the program Purchase Discount - means the minimum discount percentage from the current marketappraised value under which a property may be purchased. Under HUD Notice FR 5255 N 02, the purchase discount for NSP is at least 1 percent from the current market-appraised value of the home or property. Residential Properties - any type of permanent residential dwelling unit, such as detached single family structures, townhouses, condominium units, multifamily rental apartments (covering the entire property) and manufactured homes where treated under state law as real estate (not personal property). Including, vacant land that is currently designated for residential use, e.g. through zoning. Small Business - As used in this Agreement, the terms small business means a business that meets the criteria set forth in Section 3(a) of the Small Business Act, as amended (15 U.S.C. 632), and minority and women s business enterprise means a business at least fifty-one (51) percent owned and controlled by minority group developers or women. The CITY may rely on written representations by businesses regarding their status as minority and women-owned business enterprises in lieu of an independent investigation. Uniform Relocation Act refers to the Uniform Relocation Assistance and Real Property Acquisition Policies Act Vacant Properties - includes both vacant land (which has at some time in the past supported a structure of any kind) and properties with vacant structures on the land. A structure which has been abandoned for a long amount of time (generally over 1 year) may also be considered vacant Acronyms ARRA - American Recovery and Reinvestment Act AMI Area Median Income CDBG Community Development Block Grants DRGR Disaster Reporting Government Assistance System

32 ER Environmental Review HERA Housing and Economic Recovery Act of 2008 (authorizing funding for NSP) HUD - United States Department of Housing and Urban Development. LMI - Low Median Income a HUD-defined term incorporating households with eligible incomes at or below 50% of area median income. LMMI Low-Moderate Median Income a HUD-defined term incorporating households with eligible incomes at or below 120% of area median. NSP Neighborhood Stabilization Program URA - Uniform Relocation Assistance and Real Property Acquisition Policies Act

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89 Sample Agreement for Development and Sales of Single Family Homes About this Tool Description: This example of an agreement between an NSP grantee and a developer governs the funding and implementation of a program of acquiring NSP-qualified residential properties, rehabilitating and/or building new infill homes, and selling the homes to qualified NSP buyers. It also includes an attachment: Home Sales Activity and Detailed Budget. It is intended to be used with an adapted version of the NSP Single-Family Development and Sales Program Manual, which is referenced in this agreement. How to Adapt this Document: This document addresses major NSP regulatory provisions and represents one approach to entering into agreements with developers. However, it should not be used as-is. NSP grantees should determine if the underlying program design is suitable. Details such as numbers of units and funding limits must be considered carefully and filled in. Instructions and advice embedded in the document should be deleted. Source of Document: Substantial portions of this document come from a standard grantee-developer agreement drafted for the City of Canton, Ohio. Disclaimer: This document is not an official HUD document and has not been reviewed by HUD counsel. It is provided for informational purposes only. Any binding agreement should be reviewed by attorneys for the parties to the agreement and must conform to state and local laws. This resource is part of the NSP Toolkits. Additional toolkit resources may be found at U.S. Department of Housing and Urban Development Page 1 Neighborhood Stabilization Program

90 AGREEMENT BETWEEN The City of Nappanee AND [Developer] FOR THE Neighborhood Stabilization Program THIS AGREEMENT, is entered this day of, 20 by and between the NSP Grantee Sub recipient of The City of Nappanee (herein called Grantee ) and (herein called Developer ). WHEREAS, the Grantee has applied for and has been awarded funds from the United States Department of Housing and Urban Development (HUD) for a Neighborhood Stabilization Program, which is referred to herein as NSP ; and WHEREAS, the Grantee wishes to engage the Developer to assist the Grantee in using a portion of the NSP award in accordance with applicable notices, regulations and guidance from HUD; NOW, THEREFORE, it is agreed between the parties hereto that; I. SCOPE OF SERVICE Developer will be responsible for carrying out NSP activities in a manner satisfactory to the Grantee and consistent with all standards required as a condition of providing these funds. Program activities will include the following uses and corresponding activities eligible under NSP: A. Developer Responsibilities 1. Developer will carry out this program in accordance with the policies, procedures and other provisions of the Single Family Development and Sales Program Manual ( Program Manual ), provided to Developer by Grantee, and incorporated herein by reference. Developer hereby agrees to accept and follow any written amendments to the Program Manual by Grantee that are made as a direct result of additional guidance or regulations provided by HUD, as well as any written amendments that are mutually agreed upon by Grantee and Developer. 2. This program activity may include the acquisition and development (rehabilitation or new construction) of residential property that is foreclosed upon, abandoned, blighted or vacant in accordance with the definitions and requirements of the NSP program, to the extent that these activities are incorporated in this Section I and in Exhibit A. [Note: see separate spreadsheet document titled Exhibit A: Home Sales Activities and Detailed Budget] If the principal structure(s) of an acquired property is to be demolished Grantee must first declare the property blighted and then provide 2 P age

91 written permission to carry out the demolition. Alternatively, to demolish the structure, Developer must obtain prior approval from Grantee after demonstrating in writing to Grantee that demolition and new construction is more economically feasible than rehabilitation. In either case, the cost of demolition can be an eligible cost if preapproved by Grantee. 3. Developer is responsible for providing the deliverables that are described in Exhibit A, Homes Sales Activities and Detailed Budget, within the time periods and for the approximate average budget amounts described therein. The total use of NSP funds provided under this Agreement may not exceed the total amount of NSP funds indicated in Section III(A) below. 4. Developer s expenditures for program delivery will be limited as follows, unless changes to the limits are agreed to in writing by the Grantee and Developer for a particular property: a. Minimum number of homes to be acquired, developed and sold: 5 b. Eligible properties: Developer will acquire only properties in designated NSP target areas that are eligible under NSP for rehabilitation or redevelopment as affordable residential properties. Properties acquired must be abandoned or foreclosed upon, blighted, vacant lots, or vacant residential structures, as defined in the NSP program guidelines. Residential structures will be rehabilitated unless they are declared blighted or economically infeasible to rehabilitate by the Grantee. A new home may be reconstructed on a vacant lot acquired or a vacant lot resulting from the acquisition and demolition of a property as described above. c. Designated target areas: Developer may carry out this activity only in the NSP target area known as Nappanee1 (see attached map). d. Number of homes to be developed for households with incomes at or below 50% of area median income, to meet Grantee s 25% set aside requirement: a minimum of 2[Enter applicable number covered by this Agreement] (Per recent legislation, vacant homes can now count toward the set aside.] See the policy alert at pdf e. Prior approval of acquisitions by Grantee: Developer may not execute a purchase agreement for a property to be acquired and developed or contribute a Developer owned property to this program without first obtaining written approval by Grantee. To request this approval, Developer will provide Grantee with a property description, proof of abandoned, foreclosed, or vacant status as applicable, preliminary plans and specifications for rehabilitation or construction work, a preliminary development cost, an estimate of sale price, and an estimate of net sales proceeds including line item estimates of sales and marketing costs, closing costs and financing to be provided to the buyer. The preliminary cost estimate will be provided in a form similar to the development cost estimates in Exhibit A, herein. Grantee will base its approval upon an assessment of NSP 3 P age

92 compliance, financial feasibility, conformity to expenditure limits described herein, and the potential marketability of the property. In addition, properties must be located in NSP target areas as described herein. f. Approval and funding of demolition costs: Primary structures on properties acquired or contributed may not be demolished unless they are declared as blighted by Grantee. Unless otherwise agreed to in writing, Developer must fund the cost of demolition (if any) out of the funding that is made available in this Agreement or from the developer s own resources. g. Maximum NSP expenditure per dwelling unit: Developer may spend no more than $_170,000 on any single dwelling unit, unless Grantee gives written approval for an additional amount due to the strategic value of a property for the NSP program or unforeseen costs that were beyond the control of Developer. [Note: Setting this at less than the expected total development costs conserves NSP funds and helps leverage private funds. A higher number may be necessary if no other acquisition/construction financing is available. This limit is not necessary if separate limits are set for acquisition, rehabilitation, soft costs and developer fees as indicated below.] h. Average NSP expenditure per dwelling unit: The average NSP expenditure per dwelling unit may not exceed $150,000. Grantee encourages Developer to develop additional homes at a lower average NSP cost if it is feasible. i. Developer fee allowed per dwelling unit: The allowed developer fee is $. [enter amount] Of this amount, $ [enter amount] will be payable upon acquisition of an NSP qualified property, $ [enter amount] payable upon final completion of rehabilitation/construction work, and $ [enter amount] payable upon sale. Developer may earn no other fee or profit from sale of an NSP assisted dwelling unit, other than the general contractor fee, and sales fee, described below. [A developer fee is commonly established as a percentage of total development cost. However, absent other limitations, this can be a disincentive to containing development costs and limiting NSP subsidies. Therefore, fixed fees such as those described here might be considered. Otherwise, a percentage of total development cost should be entered.] j. General contractor fee allowed: If Developer is acting as general contractor and thus hiring and managing subcontractors, Developer may charge an additional fee in the form of a 10% mark up of subcontractor costs. Developer s reimbursement requests for construction costs may include a 10% mark up of all valid, documented costs of subcontractors who have performed construction work. However, such mark up may not be applied to non construction costs such as taxes, insurance, security, general requirement, or working capital costs. No such fees will be paid to Developer for any NSP property that is rehabilitated or built by a thirdparty general contractor. All general contractors performing work on NSP assisted projects must be properly licensed. 4 P age

93 k. Allowed sales fee or commission and marketing costs: Developer may pay no more than 7_% of the sale price as a commission to a licensed third party real estate broker or may earn an additional fee in the same amount if Developer sells the home without a broker s assistance. [The standard commission is 6% but for homes with very low prices a higher percentage or a set dollar amount per home may be required to provide sufficient incentives to sellers.] Additionally, Developer may expend up to $ [enter amount] per home in NSP funds for marketing costs such as advertisements and flyers. If marketing is funded for multiple NSP homes, the costs of such marketing must be allocated to each home. l. Allowed amount of NSP Homeowner Financial Assistance per buyer: The allowed amount of NSP Homeowner Financial Assistance per Buyer is described in the Program Manual. The total amount of Homeowner Financial Assistance will be recaptured and the obligation secured by a promissory note and mortgage deed with the Grantee named as lien holder, with an amount and terms as defined elsewhere in this section and in the Program Manual. [This sample agreement assumes that the recapture option will be used rather than resale controls, which are also allowed in NSP as an affordability mechanism.] m. Minimum cash contribution by buyer: Each buyer of an NSP home will provide a minimum of amount of cash or family gifts toward the combined down payment and closing costs, as described in the Program Manual. n. Other limits on expenditures: Other acquisition, rehabilitation/ construction and soft costs described in Exhibit A are not subject to per home cost limits on a line item basis, but must be reasonable and ordinary costs of development and, in the aggregate, must conform to the per home cost limits and average costs described elsewhere in this Section I(A)(4). No NSP funds may be spent for purchases of equipment or furnishings. o. Accounting for expenditures: Developer will account for total NSP expenditures per home by means of assigning an accounting code for NSP funded or reimbursed expenses for each property and another accounting code, if applicable, for non NSP funded expenditures (if any). At the time of the sale of an NSP assisted home, Developer will provide Grantee with a complete accounting of NSP expenditures for that home and non NSP expenditures, if any. The separate accounting of NSP and other funds used is required for establishing the maximum allowed sale price and will provide necessary financial data on NSP funded expenditures in the event of a HUD audit of program activities. p. Maximum sale price: The sale price may not exceed the afterconstruction market value of the home or the total amount of NSP and non NSP expenditures, whichever is less. The market value of a home will be determined in accordance with the provisions in the Program Manual. q. Establishment of a lien in favor of Grantee: Upon sale of an NSP funded home, Developer will cause the homebuyer(s) to execute a promissory note and mortgage deed in favor of Grantee for the combined amount of the Homeowner Financial Assistance as defined herein and in the Program Manual. The note and 5 P age

94 mortgage deed must be prepared by Developer using forms provided by Grantee. Grantee must review and approve the language inserted in these form documents prior to their being executed by the homebuyer(s). r. Repayment of net proceeds of sale to Grantee: Upon sale of an NSPfunded home, Developer will transmit the net proceeds of sale to Grantee. Net proceeds of sale are defined as follows: i. The sale price of the home; ii. (Minus) the amount of any Homeowner Financial Assistance provided to buyer, as defined herein and in the Program Manual, and described on the settlement statement; iii. (Minus) Developer costs of sale as documented by the settlement statement, including but not limited to real estate broker fees and seller paid closing costs; Iv. (Minus) The current fair market value of any real property contributed by Developer (e.g. a lot or home), in accordance with the provisions of the Program Manual. (Developer cannot be reimbursed for NSP funded acquisition costs.) v. (Plus) Any reimbursements to Developer of costs previously paid or reimbursed with NSP funds, such as pro rated taxes and assessments. 5. NSP assisted homes must be sold only to income qualified households in the categories described in Exhibit A and in at least the minimum numbers of households described. 6. Environmental reviews: Developer is responsible for completing sitespecific environmental reviews and submitting them to Grantee or an agency designated by Grantee for approval. B. Grantee Responsibilities Grantee is responsible for the following tasks and deliverables. 1. Approving each property purchase as described herein and in the Program Manual. 2. Completing Tier 1 environmental assessments and providing Tier 1 clearances for all NSP target areas, as well as approving site specific environmental reviews. [Note: If the Grantee will complete site specific environmental reviews in addition to approving them, this language should be changed.] 3. Contracting with one or more agencies that are qualified to provide prepurchase counseling and homebuyer education to prospective homebuyers in Developer s home 6 P age

95 sales program as described in Exhibit A. [Note: If the Developer is responsible for arranging and paying for these services, terms to this effect should be added to Section 1(A) and costs should be added to the budget in Exhibit A.] 4. Management of all draws of NSP funds from HUD and payment of valid and properly documented draw requests from Developer. 5. Reporting to HUD via the Disaster Reporting Government Reporting (DRGR) system, using, in part, data provided by Developer. 6. Monitoring all program activities of Developer to assure compliance with the terms of this Agreement including all NSP requirements. 7. Processing requests for disbursements of NSP funds, including necessary construction inspections, in a timely manner; Grantee will clearly and promptly describe any deficiencies identified by Grantee that prevent a disbursement or portion of a disbursement from being approved. Upon the request of Developer, Grantee must promptly itemize and describe such deficiencies in writing. 8. Ensuring that information required by the Recovery Act is reported in the Disaster Recovery Grant Reporting (DRGR) system or on in a timely manner. Grantee must comply with the NSP performance reporting requirements and with any additional reporting requirements announced by HUD at any time during the duration of this agreement C. Income Eligibility Requirements In accordance with section 2301(f)(3)(A) of the Housing and Economic Recovery Act of 2008 (HERA), Public Law , the Developer will use all NSP funds to assist individuals and families whose incomes do not exceed 120 percent of area median income. The Grantee is responsible for ensuring that 25 percent of the total grant is used for the purchase and redevelopment of abandoned or foreclosed upon homes or residential properties to house individuals and families whose incomes do not exceed 50 percent of area median income, as required by HERA.; the Developer will use NSP funding for individuals and families at or below 50 percent of area median income if required by provisions elsewhere in this agreement. D. Developer Staffing The names and roles of Developer s key personnel (staff or contractors) executing the project are as follows: Chief Executive: NSP Project Manager: Construction Manager: 7 P age

96 Person in charge of marketing: Financial staff person responsible for approving submission of NSP payment requests: [Note: A Grantee might include the following provision in situations where only certain staff of the Developer has the requisite experience to implement the activity, or if the Developer has a history of reassigning responsibilities that tends to create problems.] Any changes in the key personnel assigned or their general responsibilities under this project are subject to the prior approval of the Grantee. E. Performance Monitoring The Grantee will monitor the performance of the Developer based on goals and performance standards as stated above along with all other applicable federal, state and local laws, regulations, and policies governing the funds provided under this contract. Substandard performance as determined by the Grantee will constitute noncompliance with this Agreement. If corrective action is not taken by the Developer within a reasonable period of time after being notified by the Grantee, contract suspension or termination procedures will be initiated. Developer agrees to provide HUD, the HUD Office of Inspector General, the General Accounting Office, the Grantee, or the Grantee s internal auditor(s) access to all records related to performance of activities in this agreement. F. Progress Reports and Other Reports Developer hereby agrees to provide in a timely manner all necessary progress reports and other reports required by Grantee on forms to be provided by Grantee. II. TIME OF PERFORMANCE A. Start and Completion Dates Services of the Developer shall start on the day of, 20 and end on the day of 20 with all NSP funds allocated having been expended, unless Grantee at its sole discretion approvals a later completion date. Developer must obligate at least half of that amount by the day of, 20. [Note: It is advisable to set these spending deadlines many months before the Grantee s spending deadlines per the award from HUD, so that funds can be reallocated if necessary. The 50% spending deadline is required only in NSP2. Notwithstanding the foregoing, with respect to additional activities and funding, the term of this agreement will automatically extended to, [enter month, day, and year] if Grantee allocates additional funds to Developer for the activities described herein, or causes another entity (such as a nonprofit housing fund) to allocate additional funds. As a condition of Developer receiving such additional allocation of funds, Developer and staff of 8 P age

97 Grantee must jointly create and agree to a new Exhibit A, Homes Sales Activities and Detailed Budget, describing the additional activities, schedule and costs. The term of this Agreement and the provisions herein shall be extended to cover any additional time period during which the Developer is responsible for NSP reporting or compliance measures or remains in control of NSP funds or other NSP assets, including program income. B. NSP Funds Expenditure Deadline [Note: Delete this section from NSP2 agreements since there are only spending deadlines, not obligation deadlines, in NSP 2 likewise with NSP1 developer agreements executed or amended after the obligation deadlines in September, 2010.] Developer must Expend the total NSP funding amount in Section III (A) herein by _1/1/2014. [enter month, day, and year] [Note: it is advisable for grantees to set an obligation deadline several months earlier than the Grantee s obligation deadline 18 months from the award date. date should be no later than two years from when HUD signed the grant agreement with the Grantee]Developer must obligate at least half of that amount by 1/1/2013 [enter month, day, and year]. To obligate funds, developer must follow these procedures: 1. Funds for property acquisition are obligated by entering into a valid and NSP compliant purchase agreement. 2. Funds for construction or rehabilitation are obligated by completing a detailed set of plans and specifications (or work write up) and completing a detailed construction/rehabilitation cost estimate based upon those specifications. Such cost estimate may include a contingency for construction change orders of up to 15% for rehabilitation and up to 5% for new construction. 3. For a property that has met the requirements above, the total obligation amount will include the per unit or prorated estimates of soft costs, developer fee and selling costs based on the cost assumptions in Exhibits A. 4. Developer must report fund obligations on a monthly basis or when requests for reimbursements are made, whichever occurs sooner. 9 P age

98 III. BUDGET A. Program Budget The total amount of NSP funding allocated to Developer is $.[enter amount] This amount represents an allocation of the Grantee s total NSP funding contingent upon Developer s performance. B. Additional Budget Details A detailed project budget and cash flow projections are included in Exhibit A. In addition, the Grantee may require more detailed or different budget breakdowns than the one contained herein, and the Developer shall provide such supplementary budget information in a timely fashion in the form and content prescribed by the Grantee. C. Recapture and Reallocation of Developer s Allocation of NSP Funds If Developer fails to expend NSP funds as indicated with regard to the goals and delivery schedule in Exhibit A, Grantee at its sole discretion may recapture a portion or all of the Developer s total NSP funding allocation. The portion recaptured will be equal to Grantee s estimate of the amount of NSP funds that would remain unspent by the spending deadlines described herein, based on Developer s activities to date and capacity to complete the work. In addition, the amount of Developer s NSP funding allocation that is not obligated or expended by the deadlines in Section II herein will be recaptured immediately unless Grantee grants a brief extension of the deadline in writing based on extenuating circumstances and compelling evidence that obligations will be completed during the extended period. IV. PAYMENT It is expressly agreed and understood that the total amount of NSP funds to be paid by the Grantee to the Developer under this Agreement shall not exceed the amount described in Section III.A. herein plus additional amounts allocated, if any. Requests for the payment of eligible expenses shall be associated with the budget line items in Exhibit A and in accordance with performance. V. NOTICES Notices required by this Agreement shall be in writing and delivered via mail (postage prepaid), commercial courier, personal delivery, or sent by facsimile or other electronic means. Any notice sent as aforesaid shall be effective on the date of sending. All notices and other written communications under this Agreement shall be addressed to the individuals in the capacities indicated below, unless otherwise modified by subsequent written notice. Communication and details concerning this contract shall be directed to the following contract representatives: 10 P age

99 Grantee Developer Name & Title Grantee [Address] [Grantee, State, ZIP] [Telephone] [Fax Number] Name & Title Developer [Address] [Grantee, State, ZIP] [Telephone] [Fax Number] VI. ENTIRE AGREEMENT This agreement between the Grantee and the Developer for the use of funds eligible for receipt supersedes all prior or contemporaneous communications and proposals, whether electronic, oral, or written between the Grantee and the Developer with respect to this Agreement. Additional requirements associated with this agreement are described in Exhibits A and B. Date IN WITNESS WHEREOF, the Parties have executed this contract as of the date first written above. [Grantee] [Developer] By Authorized Representative By Attest Title Countersigned: By Title 11 P age

100 12 P age Exhibit A: Home Sales Activities and Detailed Budget

101 Note: This example shows costs funded only by NSP, but the format allows for other funding. The program income section assumes that development costs are 100% financed by NSP Sequential months in 2010 and May June July Aug Sept Oct Nov Dec Jan Feb Mar Sept TOTALS HOME DEVELOPMENT ACTIVITIES Acquisition agreements (housing units) Acquisition closings (housing units) Construction specs/est's completed (units) Rehabs/new construction completed (units) Housing units sold (assumes 1 per month after April 2011) 7 7 INCOME TARGETING AND SETASIDE EXPENDITURES Homes sold to households =<50% AMI 3 3 Homes sold to households at <120% AMI 4 4 PROJECTED AVERAGE SF UNIT COSTS NSP Funded Other Funding Total NOTES Purchase price of property acquired $29,356 $0 $29,356 No fees or soft costs may be charged except those below Acquisition developer fee $3,000 $0 $3,000 Fee must cover costs of research and other acquisition costs not described in other line items Acquisition: prorations, legal, title and recording costs $1,500 $0 $1,500 Rehabilitation/construction $36,000 $0 $36,000 Includes site security costs Rehab/construction developer fee $2,000 $0 $2,000 Real estate taxes during holding period $300 $0 $300 Property and liability insurance during holding period $700 $0 $700 Marketing budget per unit $500 $0 $500 2nd closing proorations, legal, title and recording costs $1,000 $0 $1,000 Down payment assistance to buyers not included will be "paper transfers" on the settlement sheets Commission for sale of home to homebuyer $3,200 $0 $3,200 Assumed to be a negotiated percentage greater than the usual 6% due to low sales price of homes Final developer fee, after sale $3,000 $0 $3,000 Total Costs $80,556 $0 $80,556 PROJECTED NSP FUNDS EXPENDED May June July Aug Sept Oct Nov Dec Jan Feb Mar Nov TOTALS Acquisition costs $0 $0 $0 $101,567 $135,423 $0 $0 $0 $0 $0 $0 $236,990 Constuction period costs (at end of period) $0 $0 $0 $0 $0 $0 $0 $117,000 $156,000 $0 $0 $273,000 Marketing, sales and closing period costs $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $53,900 $53,900 TOTAL PROJECTED NSP EXPENDITURES $0 $0 $0 $101,567 $135,423 $0 $0 $117,000 $156,000 $0 $53,900 $563,890 CUMULATIVE PROJECTED NSP EXPENDITURES $0 $0 $0 $101,567 $236,990 $236,990 $236,990 $353,990 $509,990 $509,990 $563,890 ESTIMATED PORTION SPENT ON 25% SETASIDE $241, P age

102 Exhibit B: Additional Requirements [These requirements are specific to the NSP 1 program. If some or all of the funds used in this Agreement come from NSP2 funding look for additional requirements in the NSP2 NOFA.] I. GENERAL CONDITIONS A. General Compliance The Developer agrees to comply with all NSP requirements, including those found in the NSP Grant Agreement, the HERA Act of 2008 and/or the Recovery Act of 2009, and the requirements applicable to entitlement communities under CDBG regulations. The Developer also agrees to comply with all other applicable Federal, state and local laws, regulations, and policies governing the funds provided under this contract. The Developer further acknowledges its responsibility for adherence to all applicable terms and conditions of this grant award by sub recipient entities and contractors, including obtaining a DUNS number (or updating the existing DUNS record), and registering with the Central Contractor Registration. The Developer further agrees to use funds available under this Agreement to supplement rather than supplant funds otherwise available. B. Independent Contractor Nothing contained in this Agreement is intended to, or shall be construed in any manner, as creating or establishing the relationship of employer/employee between the parties. The Developer shall at all times remain an independent contractor with respect to the services to be performed under this Agreement. The Grantee shall be exempt from payment of all Unemployment Compensation, FICA, retirement, life and/or medical insurance and Workers Compensation Insurance, as the Developer is an independent contractor. C. Workers Compensation The Developer shall provide Workers Compensation Insurance coverage for all of its employees involved in the performance of this Agreement. D. Suspension or Termination In accordance with 24 CFR or 84.62, the Grantee may suspend or terminate this Agreement if the Developer materially fails to comply with any terms of this Agreement, which include (but are not limited to) the following: 1. Failure to comply with any of the statutes, regulations or provisions referred to herein, or such statutes, regulations, executive orders, and HUD policies or directives as may become applicable at any time; 2. Failure, for any reason, of the Developer to fulfill in a timely and proper manner its obligations under this Agreement; 3. Ineffective or improper use of funds provided under this Agreement; or 4. Submission by the Developer to the Grantee reports that are incorrect or incomplete in any material respect. This Agreement may also be terminated for convenience by mutual agreement between the Grantee and the Developer, in whole or in part, by setting forth the reasons for such termination, the effective date, and, in the case of partial termination, the portion to be terminated. However, if in the case of a partial termination, the Grantee determines that the remaining portion of the award will not accomplish the purpose for which the award was made, the Grantee may terminate the award in its entirety. Such a termination shall only be carried out with the explicit written approval from HUD. E. Insurance and Bonding [Note: Grantee should insert its standard language regarding indemnification. The following language is included only as an example. ] 1. In General. The Developer, at his sole expense, shall purchase and maintain in full force and effect during the term of this Agreement and any renewals thereafter, policies of insurance as provided in this 14 P age

103 section naming Grantee as co insured on all such policies. Developer shall furnish to Grantee binders or policies showing the insurance in force as the time of commencement of the present term. 2. Liability Insurance. Developer shall purchase and maintain in full force general liability insurance in an amount of not less than $1,000, per occurrence for injuries or death to persons and $100, per occurrence for damage to property. This insurance shall be written with an acceptable company authorized and licensed to do business in the State of Indiana and shall be written in a form acceptable to Grantee. Said insurance shall be taken out prior to beginning any operation and shall be kept in effect until all operations have been successfully terminated. Copies, or the originals as the case may be, shall be furnished to Grantee and shall be approved by Grantee before Developer begins performance under this agreement. Developer shall designate Grantee as an additional insured on all such policies and such policies shall provide for thirty (30) days written notice of cancellation to the Grantee. Further, Developer shall provide Grantee with additional insured endorsement page from each policy in a form acceptable to Grantee. Grantee reserves the right to approve or reject any deductible amounts in the required coverage, Developer shall provide at least ten (10) days prior notice to the Grantee before any termination or reduction in coverage. Liability insurance may be obtained through a separate policy or through the required policies described in subsection (c) below. 3. Property/Casualty and Builder s Risk Insurance. Prior to taking title to any NSP assisted property, Developer will obtain a property and casualty or builder s risk insurance policy that insures the property for losses up to the amount of estimated replacement costs, which may not be less than the estimated amount of investment in the property as described in the Project Budget. If the Project Budget is increased, the amount of coverage must be increased accordingly. If Developer cannot obtain insurance coverage in the total amount of investment in the property after making best efforts, Grantee at its sole discretion may give written approval of a lesser amount of coverage. Developer shall designate Grantee an additional insured on all such policies and such policies shall provide for thirty (30) days written notice of cancellation to Grantee. Further, Developer shall provide Grantee with additional insured endorsement page from each policy in a form acceptable to Grantee. Grantee reserves the right to approve or reject any deductible amounts in the required coverage, Developer shall provide at least ten (10) days prior notice to the Grantee before any termination or reduction in coverage. d. Developer alone shall be responsible for investigation and payment of claims not covered by insurance. Grantee shall not in any way be responsible for payment of any claims determined to be Developer s responsibility under this Agreement. F. Indemnification [Note: Grantee should insert its standard language regarding indemnification. Grantee policies on indemnification vary considerably.] II. ADMINISTRATIVE REQUIREMENTS 15 P age A. Financial Management 1. Accounting Standards Developer is not subject to the provisions of 24 CFR Part 84 and 24 CFR Part 85, which apply only to governmental entities and nonprofit subrecipients carrying out NSP programs. Under this agreement, Developer is not a subrecipient, regardless of whether Developer is a nonprofit or forprofit entity. Developer will use adequate internal controls, and maintain necessary source documentation for all costs incurred and adhere to any other accounting requirements included in this Agreement or the Program Manual. 2. Cost Principles OMB Circulars A 87, Cost Principles for State, Local and Indian Tribal Governments, A 122, Cost Principles for Non Profit Organizations, or A 21, Cost Principles for Educational Institutions, do not apply to this developer agreement. B. Documentation and Record Keeping 1. Client Data The Developer shall maintain client data demonstrating client eligibility for services provided. Such data shall include, but not be limited to, client name, address, income level or other basis for

104 determining eligibility, and description of service or benefit provided. Such information shall be made available upon request to Grantee monitors or their designees for review. 2. Records to be Maintained The Developer shall maintain all records required by Federal regulations specified in 24 CFR Such records shall include but not be limited to: a. Records providing a full description of each activity undertaken; b. Records demonstrating that each activity undertaken benefits low, moderate, or middleincome persons. c. Records required to determine the eligibility of activities and the eligibility of all properties assisted; d. Records required to document the purchase and sale amounts of each property, discounts, and the sources and uses of funds for each activity; e. Records documenting compliance with the fair housing and equal opportunity requirements of the NSP program, including but not limited to the racial, ethnic, and gender characteristics of persons who are applicants for, participants in, or beneficiaries of the program; f. Records documenting efforts to ensure that the initial successor in interest in a foreclosed upon dwelling or residential real property has complied with the tenant protection requirements. 3. Retention g. Financial records; and h. Other records necessary to document compliance with Subpart K of 24 CFR Part 570. The Developer shall retain all financial records, supporting documents, statistical records, and all other records pertinent to the Agreement for a period of five (5) years. The retention period begins on the date that the Grantee submits its first quarterly performance report to HUD via DRGR. Notwithstanding the above, if there is litigation, claims, audits, negotiations or other actions that involve any of the records cited and that have started before the expiration of the five year period, then such records must be retained until completion of the actions and resolution of all issues, or the expiration of the five year period, whichever occurs later. 4. Disclosure The Developer understands that client information collected under this contract is private and the use or disclosure of such information, when not directly connected with the administration of the Grantee s or Developer s responsibilities with respect to services provided under this contract, is prohibited by law unless written consent is obtained from such person receiving service and, in the case of a minor, that of a responsible parent/guardian. 5. Close outs The Developer s obligation to the Grantee shall not end until the US Department of Housing and Urban Development completes all close out requirements for the NSP grant. Activities during this close out period shall include, but are not limited to: making final payments; disposing of program assets (including the return of all unused materials, equipment, unspent cash advances, program income balances, and accounts receivable to the Grantee; and determining the custodianship of records. However, the terms of this Agreement shall remain in effect during any period that the Developer has control over NSP funds, including program income. 6. Audits & Inspections All Developer records with respect to any matters covered by this Agreement shall be made available to the Grantee, Grantee agency, HUD, and the Comptroller General of the United States or any of their authorized representatives, at any time during normal business hours, as often as deemed necessary, to audit, examine, and make excerpts or transcripts of all relevant data. Any deficiencies noted in audit reports must be fully cleared by the Developer within 30 days after receipt by the Developer. Failure of the Developer to comply with the above audit requirements will constitute a 16 P age

105 violation of this contract and may result in the withholding of future payments or termination of this agreement. C. Reporting and Payment Procedures 1. Indirect Costs Direct and indirect costs of staff cannot be charged by Developer. Developer will be reimbursed for internal costs through a developer fee as specified in this Agreement. 2. Payment Procedures The Grantee will pay to the Developer funds available under this Agreement based upon information submitted by the Developer and consistent with any approved budget and Grantee policy concerning payments. Payments will be made for eligible NSP related expenses actually incurred by the Developer, and will not exceed actual cash requirements. Payments will be adjusted by the Grantee in accordance with advance fund and program income balances available in Developer accounts. In addition, the Grantee reserves the right to liquidate funds available under this contract for costs incurred by the Grantee on behalf of the Developer. HUD, through the Disaster Recovery Grant Reporting (DRGR) system, generally provides access to grant funds within 3 working days of an electronically submitted request by the Grantee. To ensure expeditious implementation of activities, Grantee agrees to draw funds from the line of credit and make payment to the Developer within 10 working days of receipt of the Developer s complete and properly submitted requests for payment for activities under this agreement, if feasible. Developer agrees to submit requests for payment in a timely manner in the form and at the times directed by the Grantee. 3. Progress Reports The Developer shall submit regular Progress Reports to the Grantee in the form, content, and frequency as required by the Grantee. D. Procurement 1. Compliance Developer shall comply with current Grantee policy concerning the purchase of equipment and shall maintain inventory records of all non expendable personal property as defined by such policy as may be procured with funds provided herein. All program assets (unexpended program income, property, etc.) not otherwise disposed of in the closeout agreement shall revert to the Grantee upon termination of this Agreement. 2. Procurement Process Developer is not required to competitively procure materials, property, or services except as required in the Program Manual. E. Use of and Reversion of Assets The use and disposition of real property and equipment under this Agreement shall be in compliance with the requirements of 24 CFR Part 84 [or Part 85] and 24 CFR , , and , as applicable, which include but are not limited to the following: 1. The Developer shall transfer to the Grantee any NSP funds on hand and any accounts receivable attributable to the use of funds under this Agreement at the time of expiration, cancellation, or termination, unless otherwise specified in the HUD closeout agreement with the Grantee. 2. Real property under the Developer s control that was acquired or improved, in whole or in part, with funds under this Agreement shall be used in accordance with this Agreement If the Developer fails to use NSP assisted real property in a manner that meets NSP, affordability and benefit requirements within and for the prescribed period of time, the Developer shall comply with the applicable sections under 24 CFR , , and P age

106 III. RELOCATION, REAL PROPERTY ACQUISITION AND ONE FOR ONE HOUSING REPLACEMENT The Developer agrees to comply with (a) the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended (URA), and implementing regulations at 49 CFR Part 24; 24 CFR Part 42 Displacement, Relocation Assistance and Real Property Acquisition for HUD and HUD Assisted Programs; and 24 CFR Displacement, relocation acquisition, and replacement of housing. The Developer shall provide appropriate relocation assistance (URA or section 104(d)) to eligible displaced persons as defined by applicable HUD and/or URA regulations that are displaced as a direct result of acquisition, rehabilitation, demolition or conversion for an NSP assisted project. The Developer also agrees to comply with applicable Grantee or local ordinances, resolutions and policies concerning the displacement of persons. The Developer will use NSP funds to demolish major structures or convert units from non residential uses only with the prior written permission of Grantee. Permission for demolition of minor structures such as porches, sheds and garages shall be deemed to have been granted when Grantee approves the plans and specifications (which may also be called work write ups) for a particular property that Developer is assisting with NSP funds. IV. TENANT PROTECTION REQUIREMENTS The Developer agrees to comply with the Recovery Act provisions concerning tenant protections applicable to NSP acquisitions of foreclosed property. The Developer must document its efforts to ensure that the initial successor in interest (ISII) in a foreclosed upon dwelling or residential real property (typically, the ISII in property acquired through foreclosure is the lender or trustee for holders of obligations secured by mortgage liens) has provided bona fide tenants with the notice and other protections outlined in the Recovery Act. The Developer will not use NSP funds to finance the acquisition of property from any ISII that failed to comply with applicable requirements unless the Developer assumes the obligations of such ISII with respect to bona fide tenants. If the Developer elects to assume such obligations, it may only do so if the tenant is still occupying the property and will provide any tenant displaced as a result of the NSP funded acquisition with the assistance outlined in 24 CFR If the Developer knows that the ISII did not comply with the NSP tenant protection requirements and vacated the property contrary to the NSP requirements, NSP funds cannot be used to acquire such properties. V. PERSONNEL & PARTICIPANT CONDITIONS A. Civil Rights 1. Compliance The Developer agrees to comply with applicable state and local civil rights ordinances and with Title VI of the Civil Rights Act of 1964 as amended, Title VIII of the Civil Rights Act of 1968 as amended, section 104(b) and section 109 of Title I of the Housing and Community Development Act of 1974 as amended (the HCDA), section 504 of the Rehabilitation Act of 1973, the Americans with Disabilities Act of 1990, the Age Discrimination Act of 1975, Executive Order 11063, and Executive Order as amended by Executive Orders 11375, 11478, and Nondiscrimination The Developer agrees to comply with the non discrimination in employment and contracting opportunities laws, regulations, and executive orders referenced in 24 CFR , as revised by Executive Order The applicable non discrimination provisions in section 109 of the HCDA are still applicable. 3. Section 504 The Developer agrees to comply with all Federal regulations issued pursuant to section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 794), which prohibits discrimination against the individuals with disabilities or handicaps in any Federally assisted program. The Grantee shall provide the Developer with any guidelines necessary for compliance with that portion of the regulations in force during the term of this Agreement. B. Affirmative Action 1. Approved Plan 18 P age

107 The Developer agrees that it shall be committed to carry out, pursuant to the Grantee s specifications, an Affirmative Action Program in keeping with the principles as provided in President s Executive Order of September 24, The Grantee shall provide Affirmative Action guidelines to the Developer to assist in the formulation of such program. The Developer shall submit a plan for an Affirmative Action Program for approval prior to the award of funds. 2. Women and Minority Owned Businesses (W/MBE) The Developer will use its best efforts to afford small businesses, minority business enterprises, and women s business enterprises the maximum practicable opportunity to participate in the performance of this contract. As used in this contract, the terms small business means a business that meets the criteria set forth in section 3(a) of the Small Business Act, as amended (15 U.S.C. 632), and minority and women s business enterprise means a business at least fifty one (51) percent owned and controlled by minority group Developers or women. The Developer may rely on written representations by businesses regarding their status as minority and women owned business enterprises in lieu of an independent investigation. 3. Access to Records The Developer shall furnish and cause each of its own Developers or subcontractors to furnish all information and reports required hereunder and will permit access to its books, records and accounts by the Grantee, HUD or its agent, or other authorized Federal officials for purposes of investigation to ascertain compliance with the rules, regulations and provisions stated herein. 4. Equal Employment Opportunity and Affirmative Action (EEO/AA) Statement The Developer will, in all solicitations or advertisements for employees placed by or on behalf of the Developer, state that it is an Equal Opportunity or Affirmative Action employer. 5. Subcontract Provisions The Developer will include the provisions of Paragraphs XI.A, Civil Rights, and B, Affirmative Action, in every subcontract or purchase order, specifically or by reference, so that such provisions will be binding upon each of its own Developers or subcontractors. C. Employment Restrictions 1. Prohibited Activity The Developer is prohibited from using funds provided herein or personnel employed in the administration of the program for: political activities; inherently religious activities; lobbying; political patronage; and nepotism activities. 2. Labor Standards The Developer agrees to comply with the requirements of the Secretary of Labor in accordance with the Davis Bacon Act, as amended, the provisions of Contract Work Hours and Safety Standards Act (40 U.S.C. 327 et seq.) and all other applicable Federal, state and local laws and regulations pertaining to labor standards insofar as those acts apply to the performance of this Agreement. The Developer agrees to comply with the Copeland Anti Kick Back Act (18 U.S.C. 874 et seq.) and its implementing regulations of the U.S. Department of Labor at 29 CFR Part 5. The Developer shall maintain documentation that demonstrates compliance with hour and wage requirements of this part. Such documentation shall be made available to the Grantee for review upon request. The Developer agrees that, except with respect to the rehabilitation or construction of residential property containing less than eight (8) units, all contractors engaged under contracts in excess of $2, for construction, renovation or repair work financed in whole or in part with assistance provided under this contract, shall comply with Federal requirements adopted by the Grantee pertaining to such contracts and with the applicable requirements of the regulations of the Department of Labor, under 29 CFR Parts 1, 3, 5 and 7 governing the payment of wages and ratio of apprentices and trainees to journey workers; provided that, if wage rates higher than those required under the regulations are imposed by state or local law, nothing hereunder is intended to relieve the Developer of its obligation, if any, to require payment of the higher wage. The Developer shall cause or require to be inserted in full, in all such contracts subject to such regulations, provisions meeting the requirements of this paragraph. 19 P age

108 20 P age 3. Section 3 Clause a. Compliance Compliance with the provisions of Section 3 of the Housing and Urban Development Act of 1968, as amended, and as implemented by the regulations set forth in 24 CFR 135, and all applicable rules and orders issued hereunder prior to the execution of this contract, shall be a condition of the Federal financial assistance provided under this contract and binding upon the Grantee, the Developer and any of the Developer s grantees and subcontractors. Failure to fulfill these requirements shall subject the Grantee, the Developer and any of the Developer s grantees and subcontractors, their successors and assigns, to those sanctions specified by the Agreement through which Federal assistance is provided. The Developer certifies and agrees that no contractual or other disability exists that would prevent compliance with these requirements. The Developer further agrees to comply with the Section 3 requirements and to include the following language in all subcontracts executed under this Agreement: The work to be performed under this Agreement is a project assisted under a program providing direct Federal financial assistance from HUD and is subject to the requirements of Section 3 of the Housing and Urban Development Act of 1968, as amended (12 U.S.C. 1701). Section 3 requires that to the greatest extent feasible opportunities for training and employment be given to low and very low income residents of the project area, and that contracts for work in connection with the project be awarded to business concerns that provide economic opportunities for low and very lowincome persons residing in the metropolitan area in which the project is located. The Developer further agrees to ensure that opportunities for training and employment arising in connection with a housing rehabilitation (including reduction and abatement of lead based paint hazards), housing construction, or other public construction project are given to low and very low income persons residing within the metropolitan area in which the NSP funded project is located; where feasible, priority should be given to low and very low income persons within the service area of the project or the neighborhood in which the project is located, and to low and very low income participants in other HUD programs; and award contracts for work undertaken in connection with a housing rehabilitation (including reduction and abatement of lead based paint hazards), housing construction, or other public construction project to business concerns that provide economic opportunities for low and very low income persons residing within the metropolitan area in which the NSP funded project is located; where feasible, priority should be given to business concerns that provide economic opportunities to low and very low income residents within the service area or the neighborhood in which the project is located, and to low and very low income participants in other HUD programs. The Developer certifies and agrees that no contractual or other legal incapacity exists that would prevent compliance with these requirements. b. Notifications The Developer agrees to send to each labor organization or representative of workers with which it has a collective bargaining agreement or other contract or understanding, if any, a notice advising said labor organization or worker s representative of its commitments under this Section 3 clause and shall post copies of the notice in conspicuous places available to employees and applicants for employment or training. c. Subcontracts The Developer will include this Section 3 clause in every subcontract and will take appropriate action pursuant to the subcontract upon a finding that the subcontractor is in violation of regulations issued by the Grantee s agency. The Developer will not subcontract with any entity where it has notice or knowledge that the latter has been found in violation of regulations under 24 CFR Part 135 and will not let any subcontract unless the entity has first provided it with a preliminary statement of ability to comply with the requirements of these regulations. D. Conduct 1. Assignability The Developer shall not assign or transfer any interest in this Agreement without the prior written consent of the Grantee thereto and HUD; provided, however, that claims for money due or to become due to the Developer from the Grantee under this contract may be assigned to a bank, trust

109 company, or other financial institution without such approval. Notice of any such assignment or transfer shall be furnished promptly to the Grantee. 2. Subcontracts a. Approvals The Developer shall not enter into any subcontracts over $100,000 with any agency or individual in the performance of this contract without the written consent of the Grantee prior to the execution of such agreement. b. Monitoring The Developer will monitor all subcontracted services on a regular basis to assure contract compliance. Results of monitoring efforts shall be summarized in written reports and supported with documented evidence of follow up actions taken to correct areas of noncompliance. c. Content The Developer shall cause all of the provisions of this contract in its entirety to be included in and made a part of any subcontract executed in the performance of this Agreement. d. Selection Process The Developer shall undertake to insure that all subcontracts let in the performance of this Agreement shall be awarded on a fair and open competition basis in accordance with applicable procurement requirements. Executed copies of all subcontracts shall be forwarded to the Grantee along with documentation concerning the selection process. 3. Hatch Act The Developer agrees that no funds provided, nor personnel employed under this Agreement, shall be in any way or to any extent engaged in the conduct of political activities in violation of Chapter 15 of Title V of the United States Code. 4. Conflict of Interest The Developer agrees to abide by the provisions of 24 CFR and , which include (but are not limited to) the following: a. The Developer shall maintain a written code or standards of conduct that shall govern the performance of its officers, employees or agents engaged in the award and administration of contracts supported by Federal funds. b. No employee, officer or agent of the Developer shall participate in the selection, or in the award, or administration of, a contract supported by Federal funds if a conflict of interest, real or apparent, would be involved. c. No covered persons who exercise or have exercised any functions or responsibilities with respect to NSP assisted activities, or who are in a position to participate in a decision making process or gain inside information with regard to such activities, may obtain a financial interest in any contract, or have a financial interest in any contract, subcontract, or agreement with respect to the NSP assisted activity, or with respect to the proceeds from the NSP assisted activity, either for themselves or those with whom they have business or immediate family ties, during their tenure or for a period of one (1) year thereafter. For purposes of this paragraph, a covered person includes any person who is an employee, agent, consultant, officer, or elected or appointed official of the Grantee, the Developer, or any designated public agency. 5. Lobbying The Developer hereby certifies that: a. No Federal appropriated funds have been paid or will be paid, by or on behalf of it, to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with the awarding of any Federal contract, the making of any Federal grant, the making of any Federal loan, the entering into of any cooperative agreement, and the extension, 21 P age

110 continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or cooperative agreement; b. If any funds other than Federal appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with this Federal contract, grant, loan, or cooperative agreement, it will complete and submit Standard Form LLL, Disclosure Form to Report Lobbying, in accordance with its instructions; and c. It will require that the language of paragraph (d) of this certification be included in the award documents for all subawards at all tiers (including subcontracts, subgrants, and contracts under grants, loans, and cooperative agreements) and that all Developers shall certify and disclose accordingly: d. Lobbying Certification This certification is a material representation of fact upon which reliance was placed when this transaction was made or entered into. Submission of this certification is a prerequisite for making or entering into this transaction imposed by section 1352, title 31, U.S.C. Any person who fails to file the required certification shall be subject to a civil penalty of not less than $10,000 and not more than $100,000 for each such failure. 6. Copyright If this contract results in any copyrightable material or inventions, HUD reserves the right to royalty free, non exclusive and irrevocable license to reproduce, publish or otherwise use and to authorize others to use, the work or materials for governmental purposes. 7. Religious Activities The Developer agrees that it will comply with 24 CFR (j) so that funds are not used to support inherently religious activities. VI. ENVIRONMENTAL CONDITIONS A. Air and Water The Developer agrees to comply with the following requirements insofar as they apply to the performance of this Agreement: 1. Clean Air Act, 42 U.S.C., 7401, et seq.; 2. Federal Water Pollution Control Act, as amended, 33 U.S.C., 1251, et seq., as amended, 1318 relating to inspection, monitoring, entry, reports, and information, as well as other requirements specified in said Section 114 and Section 308, and all regulations and guidelines issued thereunder; 3. Environmental Protection Agency (EPA) regulations pursuant to 40 CFR Part 50, as amended. B. Flood Disaster Protection In accordance with the requirements of the Flood Disaster Protection Act of 1973 (42 U.S.C. 4001), the Developer shall assure that for activities located in an area identified by the Federal Emergency Management Agency (FEMA) as having special flood hazards, flood insurance under the National Flood Insurance Program is obtained and maintained as a condition of financial assistance for acquisition or construction purposes (including rehabilitation). 22 P age C. Lead Based Paint The Developer agrees that any construction or rehabilitation of residential structures with assistance provided under this Agreement shall be subject to HUD Lead Based Paint Regulations at 24 CFR or 24 CFR , and 24 CFR Part 35, Subpart B. Such regulations pertain to all NSP assisted housing and require that all owners, prospective owners, and tenants of properties constructed prior to 1978 be properly notified that such properties may include lead based paint. Such notification shall point out the hazards of lead based

111 23 P age paint and explain the symptoms, treatment and precautions that should be taken when dealing with leadbased paint poisoning and the advisability and availability of blood lead level screening for children under seven. The notice should also point out that if lead based paint is found on the property, abatement measures may be undertaken. The regulations further require that, depending on the amount of Federal funds applied to a property, paint testing, risk assessment, treatment and/or abatement may be conducted.

112 D. Historic Preservation The Developer agrees to comply with the Historic Preservation requirements set forth in the National Historic Preservation Act of 1966, as amended (16 U.S.C. 470) and the procedures set forth in 36 CFR Part 800, Advisory Council on Historic Preservation Procedures for Protection of Historic Properties, insofar as they apply to the performance of this agreement. In general, this requires concurrence from the State Historic Preservation Officer for all rehabilitation and demolition of historic properties that are fifty years old or older or that are included on a Federal, state, or local historic property list. VII. ENVIRONMENTAL REVIEW All NSP assistance is subject to the National Environmental Policy Act of 1969 and related federal environmental authorities and regulations at 24 CFR part 50 or 58. VIII. REHABILITATION STANDARDS The Developer will carry out all NSP assisted rehabilitation of an abandoned or foreclosed upon home or residential property in compliance with the Grantee s rehabilitation standards and in accordance with applicable laws, codes, and other requirements relating to housing safety, quality, and habitability, in order to sell, rent, or redevelop such homes and properties. IX. ELIGIBILITY AND ALLOWABLE COSTS The Developer will ensure and document that its NSP activities meet eligible use, allowable cost, and eligible activity requirements of NSP. X. PURCHASE DISCOUNT The Developer will acquire property with NSP funds at a minimum discount of one percent for each foreclosed residential property. This requirement applies to all properties purchased with NSP funds, and the discount must be taken from the current market appraised value. XI. EMINENT DOMAIN The Developer will not undertake any involuntary acquisition of property with NSP funds without prior written consent of the Lead Applicant and written opinion of counsel that such acquisition is lawful. XII. SEVERABILITY If any provision of this Agreement is held invalid, the remainder of the Agreement shall not be affected thereby and all other parts of this Agreement shall nevertheless be in full force and effect. XIII. SECTION HEADINGS AND SUBHEADINGS The section headings and subheadings contained in this Agreement are included for convenience only and shall not limit or otherwise affect the terms of this Agreement. XIV. WAIVER The Grantee s failure to act with respect to a breach by the Developer does not waive its right to act with respect to subsequent or similar breaches. The failure of the Grantee to exercise or enforce any right or provision shall not constitute a waiver of such right or provision. 24 P age

113 EXHIBIT A: HOME SALES ACTIVITY AND DETAILED BUDGET Note: This example shows costs funded only by NSP, but the format allows for other funding. The program income section assumes that development costs are 100% financed by NSP Sequential months in 2012 and May June July Aug Sept Oct Nov Dec Jan Feb Mar Sept TOTALS HOME DEVELOPMENT ACTIVITIES Acquisition agreements (housing units) Acquisition closings (housing units) Construction specs/est's completed (units) Rehabs/new construction completed (units) Housing units sold (assumes 1 per month after April 2013) 7 7 INCOME TARGETING AND SETASIDE EXPENDITURES Homes sold to households =<50% AMI 3 3 Homes sold to households at <120% AMI 4 4 PROJECTED AVERAGE SF UNIT COSTS NSP Funded Other Funding Total NOTES Purchase price of property acquired $40,000 $0 $40,000 No fees or soft costs may be charged except those below Acquisition developer fee $3,000 $0 $3,000 Fee must cover costs of research and other acquisition costs not described in other line items Acquisition: prorations, legal, title and recording costs $1,500 $0 $1,500 Rehabilitation/construction $55,000 $0 $55,000 Includes site security costs Rehab/construction developer fee $2,000 $0 $2,000 Real estate taxes during holding period $300 $0 $300 Property and liability insurance during holding period $700 $0 $700 Marketing budget per unit $500 $0 $500 2nd closing proorations, legal, title and recording costs $1,000 $0 $1,000 Down payment assistance to buyers not included will be "paper transfers" on the settlement sheets Commission for sale of home to homebuyer $3,200 $0 $3,200 Assumed to be a negotiated percentage greater than the usual 6% due to low sales price of homes Final developer fee, after sale $3,000 $0 $3,000 Total Costs $110,200 $0 $110,200 PROJECTED NSP FUNDS EXPENDED May July Aug Sept Oct Nov Dec Jan Feb Mar Mar Nov TOTALS Acquisition costs $0 $133,500 $178,000 $0 $0 $0 $0 $0 $0 $0 $0 $311,500 Constuction period costs (at end of period) $0 $0 $0 $0 $0 $0 $116,000 $174,000 $116,000 $0 $0 $406,000 Marketing, sales and closing period costs $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $53,900 $53,900 TOTAL PROJECTED NSP EXPENDITURES $0 $133,500 $178,000 $0 $0 $0 $116,000 $174,000 $116,000 $0 $53,900 $771,400 CUMULATIVE PROJECTED NSP EXPENDITURES $0 $133,500 $311,500 $311,500 $311,500 $311,500 $427,500 $601,500 $717,500 $717,500 $771,400 ` ESTIMATED PORTION SPENT ON 25% SETASIDE $330,600

114 NSP Purchase Assistance Program Sales Contract Addendum THIS CONTRACT ADDENDUM (Addendum) is to amend the original real property sales contract (Contract) dated between the Buyer and Seller for the property located: [Address of Property to be sold/acquired] Buyer: Seller: The Seller and/or Buyer have the right to terminate the Contract if the conditions of this Addendum are not approved or complied with. CONTRACT ADDENDUM CONDITIONS: To the Seller: The Buyer is seeking federal funds to acquire property owned by the Seller. Please be informed of the following: Voluntary Sale 1. The Buyer does not have the right of eminent domain (eminent domain is the power to take private property for public use). 2. Because this is a voluntary transaction, the Buyer will not acquire the property offered for sale if negotiations fail to result in an amicable agreement. 3. Even though federal funds will be used in the acquisition of the property, the Seller WILL NOT be entitled to relocation benefits. SELLER CERTIFICATION: I, the Seller, certify that as of the date the contract was executed and/or at any time thereafter the property has been vacant. CONTRACT ADDENDUM ACCEPTANCE: The Buyer and Seller understand that if the conditions of this Addendum are not complied with, either party may terminate the Contract by notifying the other party by certified mail, return receipt requested, that the Contract is terminated. The Buyer and Seller: (i) voluntarily accept these Addendum conditions; and (ii) agree to amend the Contract to include the conditions of this Addendum. Signature of Seller: Date: Signature of Seller: Date: Signature of Buyer: Date: Signature of Buyer: Date: 12

115 NSP Notice to Seller For the Acquisition of Property with Federal Funds This Notice is for the property located at between the following parties: Buyer: Address: Seller: Address: The Buyer is seeking NSP funds to acquire property owned by the Seller. Please be informed of the following: Voluntary Sale 1. The Buyer does not have the authority to use eminent domain. 2. Because this is a voluntary transaction, the Buyer will not be able to acquire the property offered for sale if negotiations fail to result in an amicable agreement. 3. The Buyer will inform the Seller of the estimated Fair Market Value of the property prior to acquiring the property. 4. Even though federal funds will be used in the acquisition of the property, the Seller WILL NOT be entitled to any relocation benefits. 5. As of the date the contract was executed and/or any time thereafter, the property must be vacant. Signature of Buyer Date Signature of Buyer Date Acknowledgement of Receipt by Seller** Seller Date **(Acknowledgement may be in the form of a signature, evidence of receipt by fax, or copy of time/date stamp) 13

116 Addenda to contacts for acquiring properties for the NSP program Notwithstanding any other provision of this Contract, Purchaser shall have no obligation to purchase the Property, and no transfer of title to the Purchaser may occur, unless and until 1. The City of Nappanee has provided Purchaser and/or Seller with a written determination, on the basis of a federally required environmental review and an approved request for release of federal funds, that purchase of the property by Purchaser may proceed, subject to any other Contingencies in this Contract, or may proceed only if certain conditions to address issues in the environmental review shall be satisfied before or after the purchase of the property. The City of Nappanee shall use its best efforts to conclude the environmental review of the property expeditiously; and 2. Purchaser has obtained an appraisal that meets the requirements of the federal Neighborhood Stabilization Program and indicates that the contract price is at least 1% below the market value of the property. 35

117 HOUSING STANDARDS NAPPANEE NSP Mission and Housing Values In our specs, the program's mission is "to eliminate neighborhood blight through renovation and demolition while providing low -income families with safe, secure and affordable homes." The ranking of primary considerations from the program's mission is as follows: 1. Health and Safety 2. Performance and durability 3. Life cycle cost 4. Affordable operating cost 5. Balanced initial cost 6. Environmental impact 7. Historically sensitive exterior Applicable Laws and Regulations The developer intends to construct and maintain homes in full compliance with the following statutory and regulatory requirements: HUD Environmental Review Building Code: International Residential Code Housing Code: The local housing code Federal Housing Code: Housing Quality Standards Life Safety Code: Life Safety Code HAZMAT: HUD requirements for specific programs The developer will seek guidance and strive to conform to the following codes if financial resources are available for a specific project: Energy: 2009 International Energy Conservation Code (IECC) Accessibility: ANSI standards for accessibility by disabled residents HAZMAT: HUD Guidelines for the Evaluation and Control of Lead-Based Paint Hazards in Housing Building Code: CABO 1-4 Unit Dwelling Code Exceptions: On a case-by-case basis, deviations from the minimum requirements of this standard will be permitted with approval of the appropriate local agency Single-Family Housing Rehabilitation Standard Page 1 of 20

118 1 Health & Safety Repair Standard NA Replacement Standard Contaminants [GREEN STANDARD] Minimum Life 5 yrs. All materials installed will meet the following standards to minimize the presence of Volatile Organic Compounds (VOC) and Formaldehyde: All paints and primers must meet the most recent Green Seal G-11 Environmental Standard. and coatings.pdf Adhesives must comply with Rule 1168 of the South Coast Air Quality Management District. All particleboard components will meet ANSI A208.1 for formaldehyde emission limits, or all exposed particleboard edges will be sealed with a low-voc sealant or have a factory-applied, low-voc sealant prior to installation. All MDF edges will meet ANSI A208.2 for formaldehyde emission limits, or all exposed MDF edges will be sealed with a low-voc sealant or have a factory-applied, low-voc sealant prior to installation. Lead Based Paint (LBP) [GREEN STANDARD] Repair Standard Minimum Life 5 yrs. For all houses constructed prior to four (4) floors, two (2) window sills and two (2) window troughs (all randomly selected) plus a blank sample must be submitted to an EPAaccredited lead analytical laboratory and the dust samples must pass a dust wipe test for lead content as per the protocol in the HUD Guidelines. Lead-safe work practices must be followed, and only certified abatement contractors used to perform the work. See: Replacement Standard Minimum Life 20 yrs. When stabilization of surfaces containing LBP is impractical, the most affordable solution for abatement of the component will be chosen. Walls containing LBP may be covered with drywall or gutted and replaced with drywall. Trim and other wood or metal components containing LBP may be removed and replaced with similar materials. Lead-safe work practices must be followed, and only certified abatement contractors used to perform the work. Single-Family Housing Rehabilitation Standard Page 2 of 20

119 Asbestos [GREEN STANDARD] Repair Standard Minimum Life NA Non-friable intact Asbestos materials that are not creating a hazard such as cementitious exterior wall shingles may be left intact and painted if appropriate. Asbestos-resilient floor tiles may be labeled as such and covered with underlayment and new resilient flooring. Replacement Standard Minimum Life NA Friable asbestos components such as boiler or pipe insulation, badly deteriorated cementitious shingles or deteriorated flooring will be removed and, if necessary, replaced with nonhazardous materials. Radon [GREEN STANDARD] Repair Standard Minimum Life 5 yrs. All housing in this program will be subject to a "Short Term" Radon Test, and if the result is a reading of 4 pci/l or higher, a follow-up "Short Term" test will be performed. When a second test is required, average the results. If the average is above 4 pci/l, remediation will be required. Replacement Standard Minimum Life 20 yrs. If, as a result of the testing above, there is a presence of Radon at or above the 4 pci/l level, remediation will be undertaken per the EPA guidance in their Consumer's Guide to Radon Reduction. Mold [GREEN STANDARD] Repair Standard Minimum Life NA Any presence of mold is unacceptable and must be addressed per the National Center for Healthy Housing protocol "Creating a Healthy Home." screen.pdf Replacement Standard Minimum Life NA All carpeting, drywall or other gypsum-based wall coverings or any other non-structural components with mold present will be removed and replaced. The National Center for Healthy Housing protocol "Creating a Healthy Home" will be followed for remediation of structural components. Single-Family Housing Rehabilitation Standard Page 3 of 20

120 Fire Safety - Egress Repair Standard Minimum Life NA NA Replacement Standard Minimum Life NA Egress windows are required in all new sleeping and living areas unless other secondary means of escape requirements are met. The minimum dimensions for egress window clear openings are 20" wide by 24" tall, with a clear opening of 5.7 square feet. No bedrooms should be created in attics or basements unless Life Safety Code egress requirements are met. Fire and CO Alarms [GREEN STANDARD] Repair Standard Minimum Life 5 years Existing fire and smoke, carbon monoxide and security systems that meet code will be repaired to operating condition. Replacement Standard Directly wired smoke detectors are required on each dwelling floor and in all bedrooms. CO detectors are required with all fuel-burning furnaces and water heaters in sleep areas and on each floor level. Single-Family Housing Rehabilitation Standard Page 4 of 20

121 2 - Site Grading [GREEN STANDARD] Repair Standard Minimum Life 5 yrs. All grading adjacent to the building and for a distance of at least 10 feet away from the building will slope away from the structure at a pitch of at least 1 inch per foot. All bare earth will be reseeded or sod will be installed to cover. Replacement Standard NA Outbuildings Repair Standard Minimum Life 5 yrs. Unsafe and blighted structures, including outbuildings, will be removed if it is not financially feasible to complete the repairs required to make them structurally sound, leak-free, with lead hazards stabilized. Detached garages should have operable and lockable doors and windows. Replacement Standard No outbuilding replacement is permitted in this program. Fencing Repair Standard Minimum Life 3 yrs. Fencing on property lines is preferred. If repairs are needed, replacing sections in kind is permissible if the budget permits. Replacement Standard Wholesale replacement of deteriorated fencing is discouraged and should only be undertaken if the budget permits. Paving And Walks [GREEN STANDARD] Repair Standard Minimum Life 5 yrs. Essential paving, such as front sidewalks and driveways with minor defects, will be repaired to match. Tripping hazards greater than ½ must be addressed. Non-essential, highly deteriorated paving, such as sidewalks that are unnecessary, will be removed and appropriately landscaped. Replacement Standard Un-repairable essential walks and driveways will be replaced with permeable paving when financially feasible or concrete per City Ordinance. Wood-framed, handicapped-accessible ramps are an eligible expense. Single-Family Housing Rehabilitation Standard Page 5 of 20

122 Trees and Shrubbery [GREEN STANDARD] Repair Standard Minimum Life 5 yrs Trees that are dead, dying, or hazardous will be removed. Removal will include cutting close to the ground, grinding of the stump to 12 inches below the finished grade, installation of topsoil and re-seeding. Replacement Standard Replacement trees and shrubs are permitted if economically feasible and must be selected from the State Extension Service list of local, drought-resistant and non-invasive plant materials. In placement of trees, attention should be paid to shading the house to reduce air conditioning costs. Also, trees should be located a sufficient distance from foundations, sidewalls, walkways, driveways, patios and sidewalks in order to avoid future damage from root growth and branches brushing against the structure. Setbacks from structures should typically exceed half of the canopy diameter of a full-grown example of the species. Lawn [GREEN STANDARD] Repair Standard Minimum Life 1 yrs. Bare section of lawn will be reseeded with State Extension Service-recommended, droughtresistant varieties such as Tall Fescue. Replacement Standard Wholesale replacement of lawn grasses is not allowed, over-seeding is permitted with State Extension Service-recommended, drought-resistant varieties such as Tall Fescue. 3 - Exterior Building Surfaces Exterior Cladding [GREEN STANDARD] Repair Standard Minimum Life 10 years Siding and trim will be intact and weatherproof. All exterior wood components will have a minimum of one continuous coat of paint, and no exterior painted surface will have any deteriorated paint. Buildings designated as historic will have existing wood siding repaired in kind. New exterior wood will blend with existing and will be spot-primed and top-coated in a lead-safe manner. Replacement Standard Buildings not designated as historic may have siding replaced with vinyl siding to match the existing configuration. CertainTeed, Mastic, and Wolverine brands are approved. If replaced, soffit material will be vented/perforated vinyl. New wood components will be FSC certified. http :// rg/ Single-Family Housing Rehabilitation Standard Page 6 of 20

123 Exterior Porches Repair Standard Minimum Life 5 years Deteriorated concrete porches will be repaired when possible. Unsafe wood porch components will be repaired with readily available materials to conform closely to historically accurate porches in the neighborhood. Porch repairs will be structurally sound, with smooth and even decking surfaces. Deteriorated wood structural components will be replaced with preservativetreated wood. Replacement Standard Porches on building designated as historic will be rebuilt to conform closely to historically accurate porches in the neighborhood. Decks on non-historic porches will be replaced with 5/4" preservative-treated decking. Replaced railings will meet code. Replaced wood structural components will be preservative-treated. Exterior Railings Repair Standard Minimum Life 5 years Existing handrails will be structurally sound. Guard rails are required on any accessible area with a walking surface over 30" above the adjacent ground level. Sound railings may be repaired if it is possible to maintain the existing style. On historic structures railing repairs will be historically sensitive. Replacement Standard Handrails will be present on one side of all interior and exterior steps or stairways with more than two risers and around porches or platforms over 30" above the adjacent ground level, and will meet local codes. Handrails and guard rails will conform to the style of similar components in the neighborhood. On historic structures new railings will be historically sensitive. Exterior Steps and Decks Repair Standard Minimum Life 5 years Steps, stairways, and porch decks will be structurally sound, reasonably level, with smooth and even surfaces. Repairs will match existing materials, Replacement Standard In non-historic structures wood decking may be replaced with 5/4" X 6" preservative-treated material and new steps will be constructed from nominal 2" preservative-treated wood. On historic structures new wood decking will be 3/4" clear T & G fir, primed on all 6 sides before installation. Single-Family Housing Rehabilitation Standard Page 7 of 20

124 Exterior House Numbers and Mailboxes Repair & Replacement Standard Minimum Life 5 years All houses will have 4" house numbers clearly displayed near the front door, and a standard size mailbox, preferably wall-hung at the entrance. 4 - Foundations & Structure Firewalls Repair Standard Minimum Life 5 years Party walls will be maintained without cracks and plaster deterioration and covered with 5/8" type X gypsum, glued and screwed to structure. Replacement Standard When frame walls and floors adjoining other dwellings are gutted, new wall finish installations will conform to local requirements for fire ratings. Foundations Repair Standard Minimum Life 15 years Foundations will be repaired to be sound, reasonably level, and free from movement. Replacement Standard Foundation replacements are beyond the scope of the program. Structural Walls Repair Standard Minimum Life 15 years Structural framing and masonry will be free from visible deterioration, rot, or serious termite damage, and be adequately sized for current loads. Prior to rehab, all sagging floor joists or rafters will be visually inspected, and significant structural damage and its cause will be corrected. Replacement Standard New structural walls will be minimum 2" x 4", 16" OC. All exterior walls that are part of the building envelope (the air barrier and thermal barrier separating the conditioned space from the non-conditioned space) will be insulated with a minimum R-13 insulation and sheathed to code. Single-Family Housing Rehabilitation Standard Page 8 of 20

125 Repair Standard Additions Minimum Life NA NA Replacement Standard Minimum Life 60 years New additions are acceptable only when for marketing and livability reasons it is necessary to add additional bedroom space. Stamped plans must be submitted to the City Building Official for review and approval prior to bidding. All standards for Exterior Building Surfaces, Roofing, Windows and Doors, Insulation and Ventilation, Plumbing, Electrical, HVAC apply. 5 - Windows and Doors Interior Doors Repair Standard Minimum Life 5 years Baths and occupied bedrooms will have operating doors and lock sets. Replacement Standard Hollow-core, pressed-wood product consistent with the style of existing doors including a brass-plated bedroom lock set. Exterior Doors Repair Standard Minimum Life 5 years Exterior doors will be solid, weather-stripped and will operate smoothly. They will include a peep site, a dead bolt, and an entrance lock set. Replacement Standard Replacement doors at the front of the property for historically significant buildings will be historically sensitive. Steel, six-panel doors may be installed at entrances not visible from the front street and on the front of the property for buildings that are not historically significant. Dead bolt locks will be installed on all exterior doors keyed to match. All new doors will be weather-stripped to be air tight. Single-Family Housing Rehabilitation Standard Page 9 of 20

126 Windows [GREEN STANDARD] Repair Standard Minimum Life NA All windows will operate, remain in an open position when placed there, lock when closed and the open section will be covered with a screen. Replacement Standard Windows that are not repairable may be replaced and will meet the ENERGY STAR standard for this geographic region. doors.pr anat window Windows on key façades of historically sensitive properties will be wood of the style original to the building. New windows on other properties may be vinyl and double-glazed. Basement Windows Repair Standard Minimum Life 5 years A minimum of 2 basement windows on opposite sides of the building must be operable for ventilation, in good working order, and lockable. Replacement Standard Basement windows may be replaced with glass block. If so, a minimum of 2 glass block windows on opposite sides of the building must have operable and lockable center vents. 6 - Roofing Flat and Low-Slope Roofing Repair Standard Minimum Life 2 years Built-up roofing that is leak-free will be re-coated and flashing and accessories repaired if their minimum life is questionable. Replacement Standard The most cost-effective roof either 3-ply, hot built-up or EPDM will be installed. Pitched Roofs Repair Standard Minimum Life 5 years Missing and leaking shingles and flashing will be repaired on otherwise functional roofs. Slate, metal and tile roofs will be repaired when possible. Antennae will be removed. Replacement Standard No more than 2 layers of roofing are permitted. Fiberglass, asphalt, class A shingles with a prorated 25-year warranty with a continuous ridge vent will be installed over 15-lb. felt with new drip edge on all edges. Single-Family Housing Rehabilitation Standard Page 10 of 20

127 Gutters and Downspouts [GREEN STANDARD] Repair Standard Minimum Life 5 years Gutters and downspouts must be in good repair, leak free and collect storm water from all lower roof edges. Concrete splash blocks will be installed to move water away from the foundation. The system must move all storm water away from the building and prevent water from entering the structure. In addition to positive drainage away from the building, outlets will be a minimum of 3 feet away from the foundation whenever there is a history of water problems. Replacement Standard Gutters and downspouts will be installed and collect storm water from all lower roof edges. Concrete splash blocks will be installed to move water away from the foundation. The system must move all storm water away from the building and prevent water from entering the structure. In addition to positive drainage away from the building, outlets will be a minimum of 3 feet away from the foundation whenever there is a history of water problems. 7 - Insulation and Ventilation Infiltration [GREEN STANDARD] Repair Standard Minimum Life All homes or units will be tested with a Blower Door and any existing air sealing will be repaired to attain a maximum 0.35 Air Changes per Hour at 50 Pascal pressure (0.35 ACH50). Replacement Standard All homes or units will be air sealed to meet the minimum Blower Door test requirements of 0.35 Air Changes per Hour at 50 Pascal pressure (O.35 ACH50). Repair Standard NA Replacement Standard Minimum Life NA Minimum Life 20 years Single-Family Housing Rehabilitation Standard Page 11 of 20

128 The envelopes of all homes of units will have a continuous air barrier and a continuous thermal barrier that is in contact with the air barrier. Attic insulation shall be a minimum of R38 with soffit baffles installed when there are soffit vents to maintain ventilation at the eaves. All exterior walls opened in the course of renovations shall be insulated with un-faced fiberglass batts or damp spray cellulose to R13 for 2x4 framing and R19 for 2x6 framing. Whenever financially feasible, 1-inch, foil-faced polyisocyanurate foam board will be added under new siding. Rim joists will be insulated to R19 with either foil-faced foam board or Class 1-rated spray foam. Crawl space walls shall be insulated with 1-inch, foil-faced polyisocyanurate foam board and a 6mil plastic vapor barrier will be installed continuously over the ground to the sill plate with all seams sealed. The ENERGY STAR Thermal Bypass Inspection Checklist shall be completed for each home. lenders raters/downloads/thermal Bypass Inspection Checklist.pdf Single-Family Housing Rehabilitation Standard Page 12 of 20

129 Whole House Ventilation [GREEN STANDARD] Repair Standard Minimum Life 5 years All homes shall meet the most recent ASHRAE 62.2 standard by using one bathroom fan continuously operating at a verified CFM rate sufficient to meet the ASHRAE standard and creating < 0.3 Sones of fan noise. The fan will also have a > 80 CFM boost function switched one of three ways: by a switch at the entrance, with an adjustable time-delay function that runs the fan for an additional period after the switch is turned off; or a motion detector with an adjustable time-delay function that runs the fan for an additional period after the motion detector ceases to see motion; or by a humidistat. Replacement Standard As stated in the Repair Standard Repair Standard Bath Ventilation [GREEN STANDARD] Minimum Life NA NA Replacement Standard Minimum Life 10 years One bathroom must have a bath fan that meets the Whole House Ventilation requirement and also have a > 80 CFM boost function switched one of three ways: by a switch at the entrance, with an adjustable time-delay function that runs the fan for an additional period after the switch is turned off; or a motion detector with an adjustable time-delay function that runs the fan for an additional period after the motion detector ceases to see motion; or by a humidistat. Any additional bathrooms must be mechanically vented to the > 80 CFM standard with the time-delay switching described above. Kitchen Ventilation [GREEN STANDARD] Repair Standard Minimum Life 2 years All kitchens must have functional mechanical ventilation operating at a minimum 120 CFM. Replacement Standard All kitchens must have mechanical ventilation operating at a maximum of 20 Sones and producing a minimum of 150 CFM after accounting for ducting losses. All ductwork will be heavy gauge galvanized metal, air tight with mastic-sealed seams (no duct tape). It is preferred that mechanical ventilation exit at side walls and not at the soffit to minimize the potential for ice damming. Single-Family Housing Rehabilitation Standard Page 13 of 20

130 Roof Ventilation [GREEN STANDARD] Repair Standard Minimum Life 5 years 1 square foot of free venting must be supplied for every 150 SF of area directly under the roof if there is no soffit venting. 1 square foot of free venting must be supplied for every 300 SF of area directly under the roof if 20% of the venting is soffit vent and if the living space ceiling directly below the roof has a rating of one perm or less. (1 perm is achievable with a coating of ICI Dulux Ultra Hide Vapor Barrier paint per manufacturer's instructions) Replacement Standard The venting requirement is the same as with the Repair Standard above with a strong preference for a combination of ridge vents, soffit vents and the one perm-rated ceiling required for the 1 to 300 ratio. 8 - Interior Standards Interior Walls and Ceilings Repair Standard Minimum Life 3 years Holes, cracks and deteriorated and un-keyed plaster will be repaired to match the surrounding surfaces. All visual surfaces will be stabilized to minimize lead paint hazards using premium vinyl acrylic paint. Replacement Standard When necessary plaster will be replaced by 1 /2" gypsum board. Fire-rated assemblies will be specified on a project-by-project basis as required by local codes. Flooring [GREEN STANDARD] Repair Standard Minimum Life 3 years Bathroom, kitchen and other water-susceptible floor areas will be covered with water-resistant flooring that is free from tears or tripping hazards. Damaged wood floor will be repaired. When existing deteriorated carpet is installed over hardwood floors, the hardwood will be refinished whenever possible. Basement floors will be continuous concrete at least 1" thick. Replacement Standard Baths will receive resilient sheet goods over plywood underlayment, and kitchens will receive resilient sheet goods or tile over plywood underlayment. Whenever possible rooms other than kitchens and baths with existing wood flooring will be maintained as wood floors and refinished when appropriate. Rooms other than kitchens or baths without usable wood floors may be finished with carpet and associated products that are Carpet and Rug Institute's Green Label certified. New basement slabs will be at least 3" thick and have a 6-mil vapor barrier. Single-Family Housing Rehabilitation Standard Page 14 of 20

131 Closets Repair Standard Minimum Life 5 years Existing closets with a minimum depth of 2 feet will be maintained in good repair and have a shelf and clothes rod. Replacement Standard New closets may be created if there is a significant lack of storage space and the budget permits. New closets will have a depth of 2 feet and include a shelf and clothes rod. Kitchen Cabinets and Countertop [GREEN STANDARD] Repair Standard Minimum Life 3 years Kitchens will have a minimum of 10 feet of countertop with base and wall cabinets (or dishwasher) to match. Existing cabinets with hardwood doors and face frames may be repaired if in good condition. All cabinets will be sound and cleanable. Replacement Standard New kitchen cabinets will meet the ANSI A208.1 and A208.2 standard for formaldehyde content of particleboard and MDF, or have exposed edges of particleboard and MDF sealed to prevent the out-gassing of formaldehyde. Cabinets will have hardwood doors and face frames. There will be a minimum of 10 lineal feet of post-formed countertop with corresponding base cabinets and wall cabinets, and a dishwasher. Corners in countertop designs are permitted if factory assembled. A drawer base (12" or 15") will be included in new cabinetry. A plastic laminate panel to match the countertop will be installed as a base cabinet to wall cabinet backsplash behind the range and extending 6 inches past the range on both sides, or if the range is in a corner along the side wall and trimmed with chrome metal edging. Single-Family Housing Rehabilitation Standard Page 15 of 20

132 9 - Electric Ground Fault Interrupter Circuits Repair Standard Minimum Life 5 years Non-functioning GFCIs will be replaced. Kitchen counter, bath and laundry receptacles within 6' of a sink will be replaced with a GFCI-protected receptacle or protected by a GFCI device. Replacement Standard Kitchen counter, bath and laundry receptacles within 6' of a sink will be replaced with a GFCIprotected receptacle or protected by a GFCI device. Passage Lighting [GREEN STANDARD] Repair Standard Minimum Life 7 years All lights and switches in hallways, stairs and other passages will be operable and safe. Existing fixtures with incandescent lamp fittings will have minimum 7W CFL replacement lamps installed. Replacement Standard All halls, stairs and rooms necessary to cross to other rooms and stairways must be well lit and controlled by a 3-way switch using concealed wiring. Attics, basements and crawl spaces must have utility fixtures. All new light fixtures will be ENERGY STAR labeled. Kitchen Electric Distribution Repair Standard Minimum Life 5 years Existing receptacles, fixtures and switches will be safe and grounded. Replacement Standard Permanently installed or proposed stoves, refrigerators, freezers, dishwashers and disposals, washers and dryers will have separate circuits sized to N.E.C. Two separate 20-amp counter circuits are required with each kitchen area. Single-Family Housing Rehabilitation Standard Page 16 of 20

133 Interior Electric Distribution Repair Standard Minimum Life 7 years Exposed knob and tube will be replaced. Every room will have a minimum of two duplex receptacles, placed on separate walls and one light fixture or receptacle switched at each room entrance. Where the source wiring circuit is accessible (e.g. first floor above basements, in gutted rooms, etc.), receptacles will be grounded. All switch, receptacle, and junction boxes will have appropriate cover plates. Wiring will be free from hazard, and all circuits will be properly protected at the panel. Floor receptacles will be removed and a metal cover plate installed. Exposed conduit is allowed. Bedroom receptacles will be protected by an Arc Fault breaker. There must be one electrical receptacle at the service panel. Basements will have a minimum of 3 keyless bare bulb fixtures switched at the top of the stairs. Replacement Standard When a room's wall finishes are removed, it will be rewired to the latest version of the National Electric Code. Service and Panel Repair Standard Minimum Life 10 years Distribution panels will have a main disconnect, at least 10 circuit-breaker-protected circuits, a 100-amp minimum capacity and be adequate to safely supply existing and proposed devices. If a working central air conditioning system is present, the minimum service will be 150 amps. Replacement Standard 200-amp service with a main disconnect panel containing at least 30 circuit breaker positions Plumbing System Drain, Waste, Vent Lines Repair Standard Minimum Life 1 year Waste and vent lines must function without losing the trap seal. Replacement Standard When walls are removed exposing vent and waste lines those lines will be reworked to the current mechanical code. Plumbing Fixtures [GREEN STANDARD] Repair Standard Minimum Life 3 years All fixtures and faucets will have working, drip-free components. Toilets with greater than a 1.6 GPF rating will be replaced with a maximum 1.3 GPF model. Replacement Standard Single-Family Housing Rehabilitation Standard Page 17 of 20

134 Single lever, metal faucets and shower diverters with 15-year, drip-free warranty and maximum 2.0 GPM flow. White ceramic low-flow toilets (1.3 Gal), double bowl stainless steel sinks, and f i b e r g l a s s t u b s w i t h s u r r o u n d s. Repair Standard Plumbing Minimum Equipment [GREEN STANDARD] Minimum Life 3 years Existing equipment will be repaired to conform to the Housing Quality Standards. Replacement Standard Every dwelling unit will have a minimum of one single bowl sink with hot and cold running water in the kitchen and at least one bathroom containing a vanity with a sink, and a shower/tub unit, both with hot and cold running water, and a toilet. Redesigned kitchens will include an ENERGY STAR-labeled dishwasher. Water Heaters Repair Standard Minimum Life 7 years Each housing unit will have a working water heater less than 3 years old with a minimum capacity of 40 gallons if it is gas-fired. Gas water heaters more than 3 years old may be repaired if it is clear that a repair will make it operable. All electric water heaters will be replaced with a gas-fired model. Replacement Standard All units will have a minimum 40-gallon, gas-fired water heater with a 10-year warranty installed to the mechanical code. High efficiency power-vented or sealed combustion tankless models are required. Water Supply Repair Standard Minimum Life 10 years The main shut off valve must be operable and completely stop the flow of water to the house. All fixtures must be leak-free and deliver sufficient cold water and, where applicable, hot water. Replacement Standard The main shut off valve must be operable and completely stop the flow of water to the house, and should be replaced if it does not. Lead and galvanized pipe that is part of the water service or the distribution system will be replaced with plastic. All fixtures will have brass shut off valves. One freeze-protected exterior hose bib is required. Single-Family Housing Rehabilitation Standard Page 18 of 20

135 11- HVAC Air Conditioning [GREEN STANDARD] Repair Standard Minimum Life - NA Non-functioning, non-repairable air conditioners will be removed and drained of all CFCs. Existing central air conditioning will be inspected, serviced and refurbished to operate safely. Replacement Standard Minimum Life 20 years New HVAC systems will have a rough-in installed for air conditioning (> 13 SEER) Chimney Repair Repair Standard Minimum Life NA Unused chimneys will be removed to below the roof line wherever roofing is replaced. Unsound chimneys will be repaired or removed. When chimneys must be used for combustion ventilation, they will be relined. Replacement Standard Minimum Life NA The creation of new flues is not recommended in this program. The use of high efficiency closed combustion appliances is recommended to avoid the need for new flues. Replacement furnace flues, when required, will be metal double- or triple-walled as recommended by the furnace manufacturer. Distribution System Repair Standard Minimum Life 5 years Duct work and radiator piping will be well supported, insulated in unconditioned space and adequate to maintain 68 F measured 36" off the floor when the outside temperature is the average yearly minimum, in all habitable and essential rooms. All duct work will be insulated to R-7, sealed at all seams with mastic (not tape) and pressure tested to eliminate leakage. Replacement Standard Minimum Life 25 years All duct work will be insulated to R-7, sealed at all seams with mastic (not tape), pressure tested to eliminate leakage and run in concealed space. Heating System [GREEN STANDARD] Repair Standard Minimum Life 5 years Workable existing heating systems will be inspected and serviced to operate in a safe manner. Regardless of condition, resistance electric heating systems will be removed and replaced with systems as described below, unless the home has either a very low heating load due to super-insulation, solar gain or a mild climate. Replacement Standard Minimum Life 25 years Single-Family Housing Rehabilitation Standard Page 19 of 20

136 Gas-fired heating plants will be rated at > 92% AFUE or better. Oil-fired furnaces will be rated at > 83% AFUE or better. Oil-fired boilers will be rated at > 85% AFUE or better. Heat pumps will be rated at > 15 SEER. Setback thermostats are required. When electric resistance heating systems are replaced, soffits for ductwork and/or new distribution pipes for hot water heating systems will be provided. Up to 4 lineal feet of resistance electric heating strips per 1000 square feet of floor area may be retained or installed in areas that are not cost effective to heat via ductwork or hot water distribution systems. 12 Appliances Kitchen Appliances [GREEN STANDARD] Repair Standard Minimum Life 3 years All units will have a working and cleanable range. If there is an existing dishwasher in working and cleanable condition, it may be retained with minor repairs. Replacement Standard Minimum Life 15 years All redesigned kitchens will have ENERGY STAR-labeled appliances where applicable. All new cooking ranges will be electric. Sample Single-Family Housing Rehabilitation Standard Page 20 of 26

137 NSP Homebuyer Assistance Application Applicant Full Legal Name: Other Names Previously used: Home Phone: Cell Phone: Current Address: City: State: Zip: Race : African American Native Hawaiian or Pacific Islander American Indian or Alaskan Native Asian White or Caucasian Other: Ethnicity : Hispanic Non Hispanic Single Female Head of Household: Yes No Marital Status: Single Never Married Single Divorced Widowed Married Employer: Employer Address: Title/Postion: Employment (years/months): Business Phone: Gross income per pay period: $ Income per year: $ How often do you get paid? Weekly Bi Weekly Twice a Month Monthly Do you expect your household composition to change in the next 6 months? (if yes please explain) Nappanee-Elkhart County Neighborhood Stabilization Program

138 Nappanee-Elkhart County Neighborhood Stabilization Program Total Number of Household Members (all persons residing in the home): Name Date of Full Time Income Source Annual Income Birth Student / / Yes No $ / / Yes No $ / / Yes No $ / / Yes No $ / / Yes No $ / / Yes No $ / / Yes No Has your name appeared on a mortgage in the last 3 years? Yes No $ Do you currently own or rent a home? Own Rent How much is your current monthly rent/mortgage? $ How much are your utilities per month? Total monthly expenses (excluding rent): Have you been pre approved for a mortgage? If YES, amount of approval $ $ $ Yes No INTEREST RATE: % APR Bank Name: Lender/Broker s Name: Lender Address: City : State: Zip: Work Phone: Alternate Phone:

139 Nappanee-Elkhart County Neighborhood Stabilization Program NSP Property Information NSP Property Address: Are you currently working with a realtor? Yes No Realtor Name: Realtor Address: City : Phone: Do you know what your credit score is? Yes, My score is: State: Alt Phone: No, but I would rate my credit as being: Poor Good Fair Excellent Have you ever filed for Bankruptcy? No Yes Date Filed: Date Discharged: Zip: OuIOur Income I/We understand the information provided above is collected to determine if I/we are eligible to receive NSP assistance. I/We hereby certify that all the information provided herein is true and correct. I/We understand that providing false statements or information is grounds for denial and termination of NSP assistance and is punishable under federal law. I/We authorize Nappanee to verify all information provided on this application. The applicant further certifies that the property assisted by these Neighborhood Stabilization Program funds will serve as his/her/their principle residence. Signature: Date: Signature: Date:

140 Nappanee-Elkhart County Neighborhood Stabilization Program Agreement for NSP Homebuyer Counseling Course Attendance NSP requires homebuyer counseling all applicants receiving NSP assistance. NSP staff must see documentation that the applicant attended 8 hours of homebuyer counseling training. The grantee must require each NSP assisted homebuyer to receive and complete at least 8 hours of homebuyer counseling from a HUD approved housing counseling agency before obtaining a mortgage loan Grantees must design NSP programs to comply with this requirement and must document compliance in the records, for each homebuyer. (NSP 3 Notice FR 5447 N 01) Have you participated in 8 hours of homebuyer counseling from a HUD approved housing counseling agency over the previous year? A copy of a certificate or a letter from an approved counseling agency is adequate proof of attendance. Yes Completion certificate or letter attached Homebuyer counseling completed prior to the previous year Completion certificate attached (Some or all of the homebuyer counseling hours may be required to be completed again to meet program guidelines.) No I hereby attest that I will, as a condition to receiving assistance under the Nappanee NSP program, complete the requisite 8 hours of homebuyer counseling from a HUD approved counseling agency prior to closing on an NSP assisted property. NSP Homebuyer Program Applicant(s): Full Name (Please Print): Signature: Date: Full Name (Please Print): Signature: Date:

141 HUD Approved Housing Counseling Agencies GO BACK This listing is current as of 02/07/2012. Click here to narrow your search. Printer Friendly Version. Agencies located in INDIANA Agency Name Phone, Toll-Free, Fax Number, , Website Address Counseling Services Languages Parent Organization - Fair Housing Pre-Purchase Education Workshops - Financial Management/Budget Counseling - Home Improvement and MOMENTIVE CCCS - ANDERSON BRANCH Phone: Toll-free: Fax: [email protected] Website: Meridian Plaza, Suite 704 Anderson, Indiana Rehabilitation Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Predatory Lending Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - English MOMENTIVE CONSUMER CREDIT COUNSELING SERVICE, INC. - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops CITY OF BLOOMINGTON Phone: Fax: [email protected] Website: N Morton Street BLOOMINGTON, Indiana Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Predatory Lending Education Workshops - Rental Housing Counseling - Rental Housing Workshops - Reverse Mortgage Counseling - Services for Homeless Counseling - English MOMENTIVE CCCS - Phone: Toll-free: N. College, Suite Fair Housing Pre-Purchase Education Workshops - English MOMENTIVE CONSUMER

142 BLOOMINGTON BRANCH Fax: Website: Bloomington, Indiana Financial Management/Budget Counseling - Home Improvement and Rehabilitation Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Predatory Lending Education Workshops - Rental Housing Counseling - Services for Homeless Counseling CREDIT COUNSELING SERVICE, INC. - Fair Housing Pre-Purchase Education Workshops - Financial Management/Budget Counseling - Home Improvement and MOMENTIVE CCCS - COLUMBUS BRANCH Phone: Toll-free: Fax: [email protected] Website: th Street, Suite 1360 Columbus, Indiana Rehabilitation Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Predatory Lending Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - English MOMENTIVE CONSUMER CREDIT COUNSELING SERVICE, INC. - Fair Housing Pre-Purchase Education Workshops - Financial Management/Budget Counseling CATHOLIC CHARITIES, ARCHDIOCESE OF GARY Phone: Fax: [email protected] Website: S. West Street Crown Point, Indiana Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Homebuyer Education Workshops - Predatory Lending Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - English - Spanish CATHOLIC CHARITIES USA LAKE COUNTY COMMUNITY ECONOMIC DEVELOPMENT DEPT. Phone: Fax: [email protected] 2293 N Main Street Crown Point, Indiana Financial Management/Budget Counseling - Home Improvement and Rehabilitation Counseling - Mortgage Delinquency and - English - Other - Spanish

143 Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - Fair Housing Pre-Purchase Education Workshops - Financial Management/Budget GREENPATH, INC. Phone: Toll-free: [email protected] Website: N. Nappanee St. Ste. 7A ELKHART, Indiana Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - English - Spanish GREENPATH, INC. HOUSING AUTHORITY, CITY OF ELKHART Phone: Fax: [email protected] Website: ehai.org 1396 Benham Ave ELKHART, Indiana Mortgage Delinquency and Default Resolution Counseling - Pre-purchase Counseling - Rental Housing Counseling - English - Fair Housing Pre-Purchase Education Workshops - Financial Management/Budget Counseling - Home Improvement and COMMUNITY ACTION PROGRAM OF EVANSVILLE & VANDERBURGH COUNTY, INC Phone: Fax: [email protected] Website: SE 6th Street, Suite 001 Evansville, Indiana Rehabilitation Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Predatory Lending Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - English - Spanish - Financial Management/Budget HOPE OF EVANSVILLE, INC Phone: Fax: [email protected] Website: SE 6th St Ste 206 Evansville, Indiana Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - English

144 - Fair Housing Pre-Purchase Education Workshops - Financial Management/Budget Counseling - Home Improvement and MOMENTIVE CCCS - EVANSVILLE BRANCH Phone: Toll-free: Fax: [email protected] Website: N. First Avenue Evansville, Indiana Rehabilitation Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Predatory Lending Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - English MOMENTIVE CONSUMER CREDIT COUNSELING SERVICE, INC. - Financial Management/Budget Counseling - Financial, Budgeting and Credit Repair Workshops - Mortgage Delinquency and FORT WAYNE URBAN LEAGUE, INC. Phone: Fax: [email protected] Website: S. Hanna St. FORT WAYNE, Indiana Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Rental Housing Counseling - Resolving/Preventing Mortgage Delinquency Workshops - Services for Homeless Counseling - English NATIONAL URBAN LEAGUE - Fair Housing Pre-Purchase Education Workshops - Financial Management/Budget Counseling - Mortgage Delinquency and HOUSING AUTHORITY OF THE CITY OF FORT WAYNE, INDIANA Phone: Fax: [email protected] Website: Hanna Street FORT WAYNE, Indiana Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Predatory Lending Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - English LACASA OF GOSHEN, INC. Phone: [email protected] Website: N Cottage Ave Goshen, Indiana Fair Housing Pre-Purchase Education Workshops - Financial Management/Budget - English - Spanish NEIGHBORHOOD REINVESTMENT CORPORATION

145 Counseling - Home Improvement and Rehabilitation Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Predatory Lending Education Workshops - Financial Management/Budget Counseling - Home Improvement and HOUSING AUTHORITY OF THE CITY OF HAMMOND Phone: Fax: [email protected] Website: rd Street HAMMOND, Indiana Rehabilitation Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - English - Spanish - Fair Housing Pre-Purchase NORTHWEST INDIANA REINVESTMENT ALLIANCE Phone: Fax: [email protected] Website: Hohman Ave Hammond, Indiana Education Workshops - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - English - Spanish NATIONAL COMMUNITY REINVESTMENT COALITION, INC. - Financial Management/Budget Counseling - Financial, Budgeting and PATHFINDER SERVICES INC. Phone: Toll-free: Fax: [email protected] 2824 Theater Ave HUNTINGTON, Indiana Credit Repair Workshops - Home Improvement and Rehabilitation Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - English - Fair Housing Pre-Purchase Education Workshops B & D TRAINING SERVICES Phone: Toll-free: Fax: [email protected] Website: IndianaHousingCounseling.Com 2002 East 62nd Street Indianapolis, Indiana Financial Management/Budget Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - English - Spanish

146 - Pre-purchase Homebuyer Education Workshops - Financial, Budgeting and Credit Repair Workshops - Mortgage Delinquency and Default Resolution Counseling COMMUNITY ACTION OF GREATER INDIANAPOLIS, INC Phone: Fax: [email protected] Website: North Meridian Street INDIANAPOLIS, Indiana Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Rental Housing Counseling - Resolving/Preventing Mortgage Delinquency Workshops - English - Arabic - Cambodian - Cantonese - Chinese Mandarin - Creole INDIANA LEGAL SERVICES Phone: Toll-free: Fax: [email protected] Website: Market Square Center 151 N. Delaware, Suite 1850 Indianapolis, Indiana Fair Housing Pre-Purchase Education Workshops - Financial Management/Budget Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Rental Housing Counseling - Services for Homeless Counseling - Czech - English - Farsi - French - German - Hindi - Hmong - Indonesian - Italian - Korean - Other - Polish - Portuguese - Russian - Spanish - Swahili - Turkish - Ukrainian - Vietnamese INDIANAPOLIS NEIGHBORHOOD HOUSING PARTNERSHIP Phone: [email protected] Website: E 62nd St Indianapolis, Indiana Mortgage Delinquency and Default Resolution Counseling - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - English - Spanish HOUSING PARTNERSHIP NETWORK - Fair Housing Pre-Purchase MOMENTIVE CONSUMER CREDIT COUNSELING SERVICE, INC. Phone: Toll-free: Fax: [email protected] Website: N ALABAMA ST SUITE 134 INDIANAPOLIS, Indiana Education Workshops - Financial Management/Budget Counseling - Home Improvement and Rehabilitation Counseling - Mortgage Delinquency and - ASL - English NATIONAL FOUNDATION FOR CREDIT COUNSELING, INC.

147 Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Predatory Lending Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post NEIGHBORHOOD CHRISTIAN LEGAL CLINIC Phone: Fax: [email protected] Website: N. Meridian Street, Suite 201 INDIANAPOLIS, Indiana Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Predatory Lending Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - English - Spanish - Fair Housing Pre-Purchase Education Workshops - Financial Management/Budget Counseling - Home Improvement and NEW HOPE SERVICES, INC Phone: Fax: [email protected] Website: newhopeservices.org 725 Wall Street JEFFERSONVILLE, Indiana Rehabilitation Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Predatory Lending Education Workshops - Rental Housing Counseling - English - Fair Housing Pre-Purchase Education Workshops - Financial Management/Budget TELAMON CORPORATION Phone: Toll-free: Fax: [email protected] Website: S Reed Rd Kokomo, Indiana Counseling - Home Improvement and Rehabilitation Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Predatory Lending Education Workshops - Creole - English - Spanish TRANSITION RESOURCES- Phone: Toll-free: South Reed Road - Fair Housing Pre-Purchase Education Workshops - English - Spanish TELAMON CORPORATION

148 TELAMON Fax: Website: KOKOMO, Indiana Financial Management/Budget Counseling - Home Improvement and Rehabilitation Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Predatory Lending Education Workshops LAFAYETTE NEIGHBORHOOD HOUSING SERVICES, INC. DBA HOMESTEAD CONSULTING SERVICES Phone: Fax: [email protected] Website: homesteadconsulting.net 200 N 2nd St Lafayette, Indiana Mortgage Delinquency and Default Resolution Counseling - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Reverse Mortgage Counseling - English - Spanish - Home Improvement and Rehabilitation Counseling - Mortgage Delinquency and THE AFFORDABLE HOUSING CORPORATION OF MARION, INDIANA Phone: Fax: [email protected] Website: S Washington St Marion, Indiana Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - English - French - Spanish - Financial Management/Budget Counseling CONSUMER CREDIT COUNSELING SERVICE OF NORTHWEST INDIANA, INC. Phone: Fax: [email protected] Website: E 86th Ave Merrillville, IN Merrillville, Indiana Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - English NATIONAL FOUNDATION FOR CREDIT COUNSELING, INC. - Financial GREENPATH, INC. Phone: Toll-free: [email protected] Website: W. Edison Rd Suite 230 MISHAWAKA, Indiana Management/Budget Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Rental Housing Counseling - English - Spanish GREENPATH, INC. HOOSIER UPLANDS Phone: Toll-free: W Main St MITCHELL, - Fair Housing Pre-Purchase Education Workshops - English

149 ECONOMIC DEVELOPMENT CORPORATION Fax: Website: Indiana Financial Management/Budget Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Rental Housing Counseling - Services for Homeless Counseling - Fair Housing Pre-Purchase Education Workshops - Financial Management/Budget Counseling - Home Improvement and MOMENTIVE CCCS - MUNCIE BRANCH Phone: Toll-free: Fax: [email protected] Website: N. Oakwood Muncie, Indiana Rehabilitation Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Predatory Lending Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - English - Spanish MOMENTIVE CONSUMER CREDIT COUNSELING SERVICE, INC. - Mortgage Delinquency and MUNCIE HOME OWNERSHIP AND DEVELOPMENT CENTER Phone: Fax: [email protected] Website: 111 East Adams Street MUNCIE, Indiana Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - ASL - English - Financial CCCS OF THE MIDWEST Phone: Toll-free: Fax: [email protected] Website: Northgate Ct, Ste 37a NEW ALBANY, Indiana Management/Budget Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - English CCCS OF THE MIDWEST - Financial Management/Budget Counseling GRACEWORKS LUTHERAN SERVICES / CCCS OF THE MIAMI VALLEY Phone: Toll-free: Fax: [email protected] Website: E Main St Richmond, Indiana Mortgage Delinquency and Default Resolution Counseling - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - English GRACEWORKS LUTHERAN SERVICES/CCCS OF THE MIAMI VALLEY CITY OF SOUTH BEND Phone: Fax: [email protected] 227 W. Jefferson Blvd., 14th Floor SOUTH BEND, - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post - English

150 Website: Indiana Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Fair Housing Pre-Purchase Education Workshops - Mortgage Delinquency and LINCOLN HILLS DEVELOPMENT CORPORATION Phone: Toll-free: Fax: [email protected] Website: Main St TELL CITY, Indiana Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - English - Fair Housing Pre-Purchase Education Workshops - Financial Management/Budget Counseling - Home Improvement and MOMENTIVE CCCS - TERRE HAUTE BRANCH Phone: Toll-free: Fax: [email protected] Website: #30 Kenbel Plaza 1400 E. Pugh Drive, Suite 105 Terre Haute, Indiana Rehabilitation Counseling - Mortgage Delinquency and Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Predatory Lending Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - English MOMENTIVE CONSUMER CREDIT COUNSELING SERVICE, INC. - Mortgage Delinquency and Default Resolution Counseling HOUSING OPPORTUNITIES, INC Phone: Fax: [email protected] Website: Calumet Ave. VALPARAISO, Indiana Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - English - Fair Housing Pre-Purchase Education Workshops - Financial Management/Budget SOUTHERN INDIANA HOMEOWNERSHIP INC Phone: Fax: [email protected] Website: North Third Street VINCENNES, Indiana Counseling - Home Improvement and Rehabilitation Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Predatory Lending Education - English

151 Workshops - Rental Housing Counseling - Financial Management/Budget Counseling - Mortgage Delinquency and CCCS OF NORTHEASTERN INDIANA (WARSAW BRANCH) Phone: Toll-free: Fax: N. Harrison Warsaw, Indiana Default Resolution Counseling - Non-Delinquency Post Purchase Workshops - Pre-purchase Counseling - Pre-purchase Homebuyer Education Workshops - Rental Housing Counseling - Services for Homeless Counseling - English CCCS OF NORTHEASTERN INDIANA (MAIN OFFICE)