HomeMy WebLinkAboutReso 1979-9898r
RESOLUTION N0. 9898
RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF CHULA VISTA APPROVING AN AGREEb1ENT
WITH SECURITY PACIFIC NATIONAL BANK FOR
SERVICES RELATED TO THE HOME OWNERSHIP AND
HOME IMPROVEMENT PROGRAM
The City Council of the City of Chula Vista does
hereby resolve as follows:
WHEREAS, the City applied for and received Tandern
Designation from the Department of Housing and Community Development
State of California, and is therefore eligible to participate in
various housing rehabilitation and financing programs; and,
WHEREAS, Title I of the Home Ownership and Home
Improvement Program makes low-interest rehabilitation loans available
to homeowners and apartment owners who meet certain income and
re~ic?ence criteria; and,
WHEREAS, an amount of $220,000 has been set aside by
the State for the City of Chula Vista for this program; and,
WHEREAS, the City contains many citizens who would
benefit from this program; and,
WHEREAS, the existing City staff is sufficient to
administer the City's duties under this agreement in conjunction
with similar existing City programs.
NOW, THEREFORE BE IT RESOLVED that the City Council
hereby approves the attached agreement for various loan processing
services with Security Pacific National Bank.
Presented by
Approved as to form by
~~ /~`~~u n.~ C`! Attorne
Paul G. Desrochers Community George Lindberg, .. y y
Development Director
OPEP~r\TIrdG ACI2I:LT~t11`JT
TFIIS :aCR)vLTD-Z~"1' is entered into this 18th day of December
1979, between the City of Chula Vista
hereinafter referre to as "locality" and the SLCt,'RIi`Y' I%ACIFIC NATIGti;~h
BANK hereinafter referred to as "Bank".
iVF1REtLS, *_he Locality is carrying out a Neighborheed Ccrsen~aticn
Program as a part of the Locality's Cormrunity Development 3Lcc1: Grant
Progra~i under the United States Housing and Com-ntmity Development Act
of 1974 which was re-authorized by the 1977 act; and
1VIiI!RFAS, the Locality and the Bank desire to mutually agree upon
the methods ~*!d procedures under wh; ch Bank ~~nll or,_g.u:ate lOanS acccrd-
ing to California Housing Finance Agency's (C.IL F.A.) requirements for
rehabilitation and improver.:ent purposes in tre context of the California
Housing Finance Agency's (C.H.F.A.) Neighborhood Preservation Areas
FHA Title I Horde Irmrovemer_t Loan Program, which loans are subsequently
purchased by C.H.F.A.
NOW, Ti~lZEFORE, T}IE PARTIES D^:UfUALLY ACREI; AS FOLLOl9S:
1. Loan Application Package
Locality shall refer ail persons desiring credit under this Agree-
ment to the Barilc by fon,~arding to the Bank a Loan Application Package
consisting of at least the following doctunents and material
.4. Letter of Introduction from City;
B. FIiA Title I Lean Application; Application SLpplement and
the Bank's form of Fair Lending Notice;
C. Corstructici: Contract or Bids or Description of work with
cost estimate;
D. C.H. F.A. Previous Loan Certification
1;. Applicant Authorization of Confidential Disclosure.
Certification of Eligibility for C.H.P.A. Financing
Locality certifies that all applic:a ions for loans submitted will
conform io al'_ eligibility requirements established by C.H. F.A. and agreed
upon by the Locality. Loar_ as deternined by C.H. F.A. to not conforn~ i~~ith
C.ILF.F.. eligibility requirements shall be purcl~lsed, by Locality, frog:
C.IT.P.A. and Bank it nec}i.ately upon request, tmless other arrangements are
made with C.It.F.A./Bank. Such eligibility deterniiliation n:ay be made either
before or after purchase of loan by C.11.F.A. iron; Bank.
Revic~a of Loan applications
}9ithin five (S) days of receipt of the Loam Al~plicaticn Fackage, Bahl:
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shall review the Loan Application Packa,e acid fon~~ard to the hocality, in
addition to tl:e applicant, a v.-ritten r:otice indicating either the lian]<'s
approval or disapproval of the loan application. Suc}: lose application
approvals are predicated on Bank obtaining satisfactory reservation of
loan funds, for Locality, frcm C.H.F.A. Reservations are valid for 60
days from date of approval. Extensions of blue, or loan an:oura increases,
will require additional C.H. F.A. anpraval. TLe irfonnation contained in
the Love PaclmSe and in the Bank's written notice shall be held by the
Locality a a privileged and confidential docu-n:ent and not as a public
record.
Locality warrants that Bank s}~all be held harmless from any acts
of locality's employees in the course of the loan prccess, that may be
in violation of State and/or Federal credit granting statutes and re~u-
lations. Locality employees shall not express credit wcrthiness opinions
to applicants.
4. Lean Provisicns
A. Ba*ik agrees to promptly make loans for the Corumunity Conservation
Program in all cases where loan applications are approved by the Bank and
the Locality.
B. The Locality may subsidize the loan by malting a single, "Lump
Suer." interest subsidy payment to the Bank at the time of loan funding, so
that the finance charge payable by the borroo;er shall be reduced. The
subsidy amount shall be forwarded by Bank to C.H.F.A..if C.H. F.A. pur-
chases the loan.
C. Rates to be charged as determined by California Housing Finance
Agenc}' ,prior to any interest subsidy, but rot to exceed 12.OOo Annual
Percentage Rate.
D. In cases where a borrower prepays a C.Ii.F.A. loan, C.ILP..4. shall
refund to the Locality the unused prepaid interest subsidy, provided that
suc}r ioati prepa}~nent occurs during the first one-}calf (1/Z) of the original
loan tern, providing that such refund exceeds $50.00.
~. Lean Doctnnertation £; Disburser.:ent
A. Locality obtains a dated and signed rehabilitation contract. The
contract must specify the t}~pe of v^.provements and t}:e itemized
cost of those improvements. if the property cw~:er perfon•:~s the
~~~ark himself cr herself, the locality must certify the re;LLzbili-
taticn specifications and the itemized cost of each improvement.
B. Locality fcnrards the executed contract or locality-certified
specifications to Bank with a request for loom documents.
C. Basil: prepares and foslvards loan doamrentation a.t the interest rate
previously deternrirred and advises locality of the inrterest subsidy
due. Payments cn the loan shall be irs equal montlrl}~ instalments.
T!se first payment is due ~0 cir~ys fi•om )vote date.
D. Locality obtains borrower's signature on loan docrmrentatien, in-
cluding CEiFA-required certificates, arranges for notarial arrange-
ments, and returns all doa:ments to Bank.
E. Bank fonaards to the Locality lean proceeds in the form of one or
more Cashier's Checks payable to the borrowerr. If more than one
check is necessary, the locality will inform the Bank of tLe num-
ber of checks to be issued.
Q ~A requires loan f,mds to be disbursed only after all or part
of the rehabilitation is complete. The locality must inspect the
work and "sign off" before each payment is rude.
6, Comoleti_on Certificate
A. Locality makes a final inspection.
B. Locality executes tyre completion certification (FIiA-2).
(i) The certificate must be properly filled in and signed by
both the customer and tl:e contractors. It must be dated
• the day it is signed by the borrov;ers, and borrowers must
sign it only AFTER work has been completed. The completion
certificate shall be accompanied by the necessary lien re-
leases.
(ii) Locality fonaards the completed and signed completion certifi-
cate to Lank.
7. Collection of Ftmds
The Bank shall collect all monthly pa}Tierts made on account of loans
originated under this lean program. There shall be no additional charge
to the borroweer or the Locality for servicing of loans except charges to the
borrower resulting from late pavraerts, defaults and/or foreclosures. The
Federal Gmrerranent and/or the Banil: or their desi~aces are net barred by t}us
provision from collecting amounts firm the borrower whic}~ represent a less
of principal, interest and/or administrative or legal costs resulting from a
foreclosed loan.
8. Delirxiucncy mrd Porcclosuro
The Banlc shall forward to the Locality a copy of defaults anti fore-
closure or proposed foreclosure proceedings. T}te Locality shall }rave the
option to cure any default of the borrower. The report by the Bank to the
Locality of loan delinquencies shall be made at least once a month unless
the Bank finds t}u~t the number of deli.-rc;ucnt lours is too small to justify
sudr re;,ortir_g, cr the locality elects to ~:aive such reporting.
9. Locality's Loan Liability
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Locality shall not be liable or responsible ir_ ary maimer, in the event
of borrower's default on tie promissory note tcith C.I..P.A. or Bank, related
to the loan, so long as loan originally conforn:ed to C.H.1=.F.. eligibility re-
quirements.
10. Termination
The teen of this agreement shall be ongoing from the date of executioi:
by the Locality and Bank. T}iis agreement may be amended so long as such inner:d-
ment is in wz•iting and agreed open by both Locality and Eai:l:. Terrination of
this agreement may be mace by either Lccalit}- or Banff: so long as ~~zitten nctice
of intent to tern:inate is given by the other party at least 6G <l.zys prior to
the tem:ination date. tUiy termination of this agreement shall not affect the
operation hereof as it relates to loans outstanding at the time of said tern:ina-
tion.
December 19 1979 By ~~9~,,~' `( ~ ~.,~„dy~,
Title Mayor ~~
1979 By -J
Title
Approved by:
City Council December 19 ,1979
.T,a„r . , e*
Security Pacific National Bank ! ,19P6
i..
ADOPTED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF
CHU.A VISTA, CALIFORNIA, fhl8 18th day of December
197 9 , by tha following vote, to-wit:
AYES: ColxlCllmen Cox, Hyde, McCandliss, Scott, Gillow
NAYES: Councilmen None
ABSTAIN: Caunciknen None
ABSENT: Councimen None
ATTES H
city clerk
STATE OF CALIFORNIA )
COUNTY OF SAN DIEGO ) ss.
CITY OF CHULA VISTA )
I, JENNIE M. FULASZ, CMC, GTY CLERK of the City of Chulo Vista, California,
DO HEREBY CERTIFY that the above and foregoing is a full, true and correct Dopy of
RESOLUTION N0. 9898
DATED
(seal)
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,and that the same has not been amended or repealed.
City Cle-k
cc-sso