HomeMy WebLinkAbouta200 staff reportCITY OF NATIONAL CITY, CALIFORNIA
COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY
COUNCIL AGENDA STATEMENT
MEETING DATE:
November 20, 2012
AGENDA ITEM NO.
ITEM TITLE:
Resolution of the Community Development Commission- Housing Authority of the City of National City
authorizing the Chairman to execute a Subordination Agreement allowing a new mortgage not -to -exceed
$155,000 to be and remain a lien prior and superior to a First -Time Horne Buyer assistance loan on a
single -unit property located in National City
PREPARED BY: Carlos Aguirre Co m. Dev. Specialist II DEPARTMENT: Housi and Grants -A
PHONE: 619 336-4391 APPROVED
EXPLANATION:
The Community Development Commission -Housing Authority of the City of National City (CDC -HA) made
a loan for $189,426 from the HOME Investment Partnerships Program to Lonnie D. Littleton ("Borrower") on
6/19/2009 to assist the Borrower in the purchase of single-family residence located at 200 Visayan Street in
National City. The CDC -HA loan is fully deferred as long as the residence is occupied by the Borrower and the
Borrower performs under all other Covenants and Agreements contained in the Deed of Trust of the CDC -HA
loan and is due upon the sale or transfer of title. The Borrower is interested in refinancing the first lien on the
property and has been approved for a new loan with Bank of America ("Lender").
The Lender is requiring that the CDC -HA execute a subordination agreement allowing the new loan to
hold superior position to the CDC -HA issued loan. The CDC -HA loan will maintain second lien position on the
property. The purpose of the refinance is to allow the Borrower to reduce the interest rate paid to a fixed 3.75%
interest and there will be no cash proceeds to the Borrowers through the refinance. Staff has satisfactorily
reviewed the preliminary title report, new loan terms, and estimated HUD-1 closing statement that outline the
closing costs of the transaction. The CDC-HA's legal counsel will be provided the new Deed of Trust to review
and approve before the Subordination Agreement is executed by the CDC -HA.
FINANCIAL STATEMENT: APPROVED: % '? �/^ �` _ Finance
ACCOUNT NO. APPROVED: / MIS
There is no fiscal impact associated with this request.
ENVIRONMENTAL REVIEW:
Entering into the subordination agreement is exempt from environmental review.
ORDINANCE: INTRODUCTION: n FINAL ADOPTION:
STAFF RECOMMENDATION:
Staff recommends the adoption of a resolution to execute the Subordination Agreement.
BOARD / COMMISSION RECOMMENDATION:
There is no board or commission recommendation required for the Subordination Agreement.
ATTACHMENTS:
1. Draft Subordination Agreement between the CDC -HA and Borrower