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Home My WebLink About2010 CON Community Housing Works - First Time Homebuyer Assistance ProgramAGREEMENT BY AND BETWEEN THE CITY OF NATIONAL CITY AND COMMUNITY HOUSINGWORKS REALTY & LENDING, INC. This agreement ("Agreement"), is entered into this 22'd day of June, 2010, by and between the City of National City, a municipal corporation (the "City"), and Community HousingWorks Realty & Lending, Inc., a 501(c)3 non-profit public benefit corporation (the "Subrecipient"). RECITALS WHEREAS, the City receives an annual allocation of Home Investment Partnerships ("HOME") program funds from the U.S. Department of Housing and Urban Development ("HUD") and has made an allocation of funds to establish a first time homebuyer down payment and closing cost assistance program ("Program"); and WHEREAS, the City has appropriated $358,090.00 in Fiscal Year 2010 and $296,989.00 in Fiscal Year 2011 to assist low-income First Time Homebuyers at or under 80% of Area Median Income by providing assistance in the form of a silent second mortgage loan of 20% of the purchase price up to $40,000; and WHEREAS, the City has selected the Subrecipient through a Request for Proposal process to provide professional consultant services to assist the City in managing a first time homebuyer down payment and closing cost assistance program due to the Subrecipient's intimate knowledge of and extensive experience in HOME funded down payment program administration and loan servicing; and WHEREAS, the City has determined that the Subrecipient has the experience, adequate staff capacity, and ability to deliver the services desired by the City in a professional and timely manner, and the Subrecipient is willing to perform such services. NOW, THEREFORE, THE PARTIES HERETO DO MUTUALLY AGREE AS FOLLOWS: 1. ENGAGEMENT OF SUBRECIPIENT. The City hereby agrees to engage the Subrecipient and the Subrecipient hereby agrees to perform the services hereinafter set forth in accordance with all terms and conditions contained herein. The Subrecipient represents that all services required hereunder will be performed directly by the Subrecipient or under direct supervision of the Subrecipient. 2. SCOPE OF SERVICES. The express purpose of this Contract is for the City to provide the Subrecipient with SIX HUNDRED FIFTY FIVE THOUSAND SEVENTY NINE AND NO/100 DOLLARS ($655,079.00) of HOME Program funds. All funds shall be used by Subrecipient solely to directly assist 15 to 20 low-income homebuyers purchase a home through the provision of a second mortgage loan. The Subrecipient will perform services as set forth in the attached Exhibit "A" entitled Scope of Work and the National City First Time Homebuyer Assistance Program Manual, Exhibit "B", that provides a detailed description of the use of HOME funds under this Agreement including a description of the project, roles and responsibilities, performance standards, affordability, project requirements, and property standards. The Subrecipient shall be responsible for all research and reviews related to the work and shall not rely on personnel of the City for such services, except as authorized in advance by the City. The Subrecipient shall appear at Program related meetings and provide reports as cited in Exhibit "A" to keep staff and City Council advised of the progress on the Program. The City may unilaterally, or upon request from the Subrecipient, from time to time reduce or increase the Scope of Services to be performed by the Subrecipient under this Agreement. Upon doing so, the City and the Subrecipient agree to meet in good faith and confer for the purpose of negotiating a corresponding reduction or increase in the compensation associated with said change in services, not to exceed a factor of 5% from the base amount. Subrecipient closed loan and annual service fees are subject to a 3% annual increase on the anniversary date of contract. 3. PROJECT COORDINATION AND SUPERVISION. Carlos Aguirre, Community Development Specialist II, is hereby designated as the Program Coordinator for the City and will monitor the progress and execution of this Agreement. The Subrecipient shall assign a single Program Director to provide supervision and have overall responsibility for the progress and execution of this Agreement for the Subrecipient. Dee Sodano, Assistant Vice President of Lending is hereby designated as the Program Director for the Subrecipient. 4. COMPENSATION AND PAYMENT. The compensation for the Subrecipient shall be based on monthly billings covering actual work performed. Billings shall include labor classifications, respective rates, hours worked and materials, if any. The total cost for all work described in Exhibit "A" shall not exceed the schedule given in Exhibit "A" without prior written authorization from the City's Community Development Department Executive Director. Monthly invoices will be processed for payment and remitted within thirty (30) days from receipt of invoice, provided that work is accomplished consistent with Exhibit "A" as determined by the City. The Subrecipient shall maintain all books, documents, papers, employee time sheets, accounting records, and other evidence pertaining to costs incurred and shall make such materials available at its office at all reasonable times during the term of this Agreement and for five (5) years from the date of final payment under this Agreement, for inspection by the City and for furnishing of copies to the City, if requested. 5. ACCEPTABILITY OF WORK. The City shall decide any and all questions which may arise as to the quality or acceptability of the services performed and the manner of performance, the acceptable completion of this Agreement and the amount of compensation due. In the event the Subrecipient and the City cannot agree to the quality or acceptability of the work, the manner of performance and/or the compensation payable to the Subrecipient in this Agreement, the City or the Subrecipient shall give to the other written notice. Within ten (10) business days, the Subrecipient and the City shall each prepare a report which supports their position and file the same with the other party. The City shall, with HOME Program Subrecipient Agreement National City First Time Homebuyer Assistance Program Page 2 of 15 reasonable diligence, determine the quality or acceptability of the work, the manner of performance and/or the compensation payable to the Subrecipient. 6. LENGTH OF AGREEMENT. This contract begins on the date that it is executed, with all funds being committed within twenty-two (22) months of the execution date. All loans are to be funded within twenty-four (24) months of the execution date of this Contract. 7. DISPOSITION AND OWNERSHIP OF DOCUMENTS. All reports, studies, information, data, statistics, forms, designs, plans, and procedures, systems and any other materials or properties produced under this agreement shall be the sole and exclusive property of the City. No such materials or properties produced in whole or in part under this Agreement shall be subject to private use, copyrights, or patent rights by the Subrecipient in the United States or in any other country without the express consent of the City. City shall have unrestricted authority to publish, disclose (except as may be limited by the provisions of the Public Records Act), distribute, and otherwise use, copyright or patent, in whole or in part, any such reports, studies, data, statistics, forms or other materials or properties produced under this Agreement. 8. INDEPENDENT CONTRACTOR. Both parties hereto in the performance of this Agreement will be acting in an independent capacity and not as agents, employees, partners or joint ventures with one another. Neither the Subrecipient nor the Subrecipient's employees are employee of the City and are not entitled to any of the rights, benefits, or privileges of the City's employees, including but not limited to retirement, medical, unemploy- ment, or workers' compensation insurance. This Agreement contemplates the personal services of the Subrecipient and the Subrecipient's employees, and it is recognized by the parties that a substantial inducement to the City for entering into this Agreement was, and is, the professional reputation and competence of the Subrecipient and its employees. Neither this Agreement nor any interest herein may be assigned by the Subrecipient without the prior written consent of the City. Nothing herein contained is intended to prevent the Subrecipient from employing or hiring as many employees, or subcontractors, as the Subrecipient may deem necessary for the proper and efficient performance of this Agreement. All agreements by Subrecipient with its subcontractor(s) shall require the subcontractor to adhere to the applicable terms of this Agreement. 9. CONTROL. Neither the City nor its officers, agents or employees shall have any control over the conduct of the Subrecipient or any of the Subrecipient's employees except as herein set forth, and the Subrecipient expressly agrees not to represent that the Subrecipient or the Subrecipient's agents, servants, or employees are in any manner agents, servants or employees of the City, it being understood that the Subrecipient, its agents, servants, and employees are as to the City wholly independent contractors and that the Subrecipient's obligations to the City are solely such as are prescribed by this Agreement. 10. COMPLIANCE WITH APPLICABLE LAW. The Subrecipient, in the performance of the services to be provided herein, shall comply with all applicable State and Federal statutes and regulations, and all applicable ordinances, rules and regulations of the City of National City, whether now in force or subsequently enacted. The Subrecipient, and each of HOME Program Subrecipient Agreement National City First Time Homebuyer Assistance Program Page 3 of 15 its subcontractors, shall obtain and maintain a current City of National City business license prior to and during performance of any work pursuant to this Agreement. 11. LICENSES, PERMITS, ETC. The Subrecipient represents and covenants that it has all licenses, permits, qualifications, and approvals of whatever nature that are legally required to practice its profession. The Subrecipient represents and covenants that the Subrecipient shall, at its sole cost and expense, keep in effect at all times during the term of this Agreement, any license, permit, or approval which is legally required for the Subrecipient to practice its profession. 12. STANDARD OF CARE. A. The Subrecipient, in performing any services under this Agreement, shall perform in a manner consistent with that level of care and skill ordinarily exercised by members of the Subrecipient's trade or profession currently practicing under similar conditions and in similar locations. The Subrecipient shall take all special precautions necessary to protect the Subrecipient's employees and members of the public from risk of harm arising out of the nature of the work and/or the conditions of the work site. B. Unless disclosed in writing prior to the date of this agreement, the Subrecipient warrants to the City that it is not now, nor has it for the five (5) years preceding, been debarred by a governmental agency or involved in debarment, arbitration or litigation proceedings concerning the Subrecipient's professional performance or the furnishing of materials or services relating thereto. C. The Subrecipient is responsible for identifying any unique products, treatments, processes or materials whose availability is critical to the success of the project the Subrecipient has been retained to perform, within the time requirements of the City, or, when no time is specified, then within a commercially reasonable time. Accordingly, unless the Subrecipient has notified the City otherwise, the Subrecipient warrants that all products, materials, processes or treatments identified in the project documents prepared for the City are reasonably commercially available. Any failure by the Subrecipient to use due diligence under this sub -paragraph will render the Subrecipient liable to the City for any increased costs that result from the City's later inability to obtain the specified items or any reasonable substitute within a price range that allows for project completion in the time frame specified or, when not specified, then within a commercially reasonable time. 13. NON-DISCRIMINATION PROVISIONS. The Subrecipient shall not discriminate against any employee or applicant for employment because of age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition. The Subrecipient will take positive action to insure that applicants are employed without regard to their age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition. Such action shall include but not be limited to the following: employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship. The Subrecipient agrees to post in conspicuous places available to employees and applicants for employment any notices provided by the City setting forth the provisions of this non-discrimination clause. 14. CONFIDENTIAL INFORMATION. The City may from time to time communicate to the Subrecipient certain confidential information to enable the Subrecipient to effectively perform the services to be provided herein. The Subrecipient shall treat all such HOME Program Subrecipient Agreement National City First Time Homebuyer Assistance Program Page 4 of 15 information as confidential and shall not disclose any part thereof without the prior written consent of the City. The Subrecipient shall limit the use and circulation of such information, even within its own organization, to the extent necessary to perform the services to be provided herein. The foregoing obligation of this Section 13, however, shall not apply to any part of the information that (i) has been disclosed in publicly available sources of information; (ii) is, through no fault of the Subrecipient, hereafter disclosed in publicly available sources of information; (iii) is already in the possession of the Subrecipient without any obligation of confidentiality; or (iv) has been or is hereafter rightfully disclosed to the Subrecipient by a third party, but only to the extent that the use or disclosure thereof has been or is rightfully authorized by that third party. The Subrecipient shall not disclose any reports, recommendations, conclusions or other results of the services or the existence of the subject matter of this Agreement without the prior written consent of the City. In its performance hereunder, the Subrecipient shall comply with all legal obligations it may now or hereafter have respecting the information or other property of any other person, firm or corporation. Subrecipient shall be liable to City for any damages caused by breach of this condition, pursuant to the provisions of Section 14. 15. INDEMNIFICATION AND HOLD HARMLESS. The Subrecipient agrees to defend, indemnify, and hold harmless the City of National City, its officers and employees, against and from any and all liability, loss, damages to property, injuries to, or death of any person or persons, and all claims, demands, suits, actions, proceedings, reasonable attorneys' fees, and defense costs, of any kind or nature, including workers' compensation claims, of or by anyone whomsoever, resulting from or arising out of the Subrecipient's negligent performance of this Agreement. 16. WORKERS' COMPENSATION. The Subrecipient shall comply with all of the provisions of the Workers' Compensation Insurance and Safety Acts of the State of California, the applicable provisions of Division 4 and 5 of the California Government Code and all amendments thereto; and all similar state or Federal acts or laws applicable; and shall indemnify, and hold harmless the City and its officers, and employees from and against all claims, demands, payments, suits, actions, proceedings and judgments of every nature and description, including reasonable attorney's fees and defense costs presented, brought or recovered against the City or its officers, employees, or volunteers, for or on account of any liability under any of said acts which may be incurred by reason of any work to be performed by the Subrecipient under this Agreement. 17. INSURANCE. The Subrecipient, at its sole cost and expense, shall purchase and maintain, and shall require its Contractors, when applicable, to purchase and maintain throughout the term of this agreement, the following insurance policies: A. If checked, Professional Liability Insurance (errors and omissions) with minimum limits of $1,000,000 per occurrence. B. Automobile insurance covering all bodily injury and property damage incurred during the performance of this Agreement, with a minimum coverage of $1,000,000 combined single limit per accident. Such automobile insurance shall include owned, non - owned, and hired vehicles ("any auto"). HOME Program Subrecipient Agreement National City First Time Homebuyer Assistance Program Page 5 of 15 C. Commercial general liability insurance, with minimum limits of $1,000,000 per occurrence/ $2,000,000 aggregate, covering all bodily injury and property damage arising out of its operations under this Agreement. D. Workers' compensation insurance in an amount sufficient to meet statutory requirements covering all of Subrecipient employees and employers' liability insurance with limits of at least $1,000,000 per accident. In addition, the policy shall be endorsed with a waiver of subrogation in favor of the City. Said endorsement shall be provided prior to commencement of work under this Agreement. E. The aforesaid policies shall constitute primary insurance as to the City, its officers, employees, and volunteers, so that any other policies held by the City shall not contribute to any loss under said insurance. Said policies shall provide for thirty (30) days prior written notice to the City of cancellation or material change. F. Said policies, except for the professional liability and workers' compensation policies, shall name the City and its officers, agents and employees as additional insureds, and separate additional insured endorsements shall be provided. G. If required insurance coverage is provided on a "claims made" rather than "occurrence" form, the Subrecipient shall maintain such insurance coverage for three years after expiration of the term (and any extensions) of this Agreement. In addition, the "retro" date must be on or before the date of this Agreement. H. Any aggregate insurance limits must apply solely to this Agreement. Insurance shall be written with only California admitted companies which hold a current policy holder's alphabetic and financial size category rating of not less than A VIII according to the current Best's Key Rating Guide, or a company equal financial stability that is approved by the City's Risk Manager. In the event coverage is provided by non -admitted "surplus lines" carriers, they must be included on the most recent California List of Eligible Surplus Lines Insurers (LESLI list) and otherwise meet rating requirements. J. This Agreement shall not take effect until certificate(s) or other sufficient proof that these insurance provisions have been complied with, are filed with and approved by the City's Risk Manager. If the Subrecipient does not keep all of such insurance policies in full force and effect at all times during the terms of this Agreement, the City may elect to treat the failure to maintain the requisite insurance as a breach of this Agreement and terminate the Agreement as provided herein. K. All deductibles and self -insured retentions in excess of $10,000 must be disclosed to and approved by the City. 18. LEGAL FEES. If any party brings a suit or action against the other party arising from any breach of any of the covenants or agreements or any inaccuracies in any of the representations and warranties on the part of the other party arising out of this Agreement, then in that event, the prevailing party in such action or dispute, whether by final judgment or out -of -court settlement, shall be entitled to have and recover of and from the other party all costs and expenses of suit, including attorneys' fees. For purposes of determining who is to be considered the prevailing party, it is stipulated that attorney's fees incurred in the prosecution or defense of the action or suit shall not be considered in determining the amount of the judgment or award. Attorney's fees to the prevailing party if other than the City shall, in addition, be limited to the amount of attorney's fees incurred by the City in its prosecution or defense of the action, irrespective of the actual amount of attorney's fees incurred by the prevailing party. HOME Program Subrecipient Agreement National City First Time Homebuyer Assistance Program Page 6 of 15 19. MEDIATION/ARBITRATION. If a dispute arises out of or relates to this Agreement, or the breach thereof, the parties agree first to try, in good faith, to settle the dispute by mediation in San Diego, California, in accordance with the Commercial Mediation Rules of the American Arbitration Association (the "AAA") before resorting to arbitration. The costs of mediation shall be borne equally by the parties. Any controversy or claim arising out of, or relating to, this Agreement, or breach thereof, which is not resolved by mediation shall be settled by arbitration in San Diego, California, in accordance with the Commercial Arbitration Rules of the AAA then existing. Any award rendered shall be final and conclusive upon the parties, and a judgment thereon may be entered in any court having jurisdiction over the subject matter of the controversy. The expenses of the arbitration shall be borne equally by the parties to the arbitration, provided that each party shall pay for and bear the costs of its own experts, evidence and attorneys' fees, except that the arbitrator may assess such expenses or any part thereof against a specified party as part of the arbitration award. 20. TERMINATION. A. This Agreement may be terminated with or without cause by the City. Termination without cause shall be effective only upon 60-day's written notice to the Subrecipient. During said 60-day period the Subrecipient shall perform all services in accordance with this Agreement. B. This Agreement may also be terminated immediately by the City for cause in the event of a material breach of this Agreement, misrepresentation by the Subrecipient in connection with the formation of this Agreement or the performance of services, or the failure to perform services as directed by the City. C. Termination with or without cause shall be effected by delivery of written Notice of Termination to the Subrecipient as provided for herein. D. In the event of termination, all finished or unfinished Memoranda Reports, Maps, Drawings, Plans, Specifications and other documents prepared by the Subrecipient, whether paper or electronic, shall immediately become the property of and be delivered to the City, and the Subrecipient shall be entitled to receive just and equitable compensation for any work satisfactorily completed on such documents and other materials up to the effective date of the Notice of Termination, not to exceed the amounts payable hereunder, and less any damages caused the City by the Subrecipient's breach, if any. Thereafter, ownership of said written material shall vest in the City all rights set forth in Section 6. E. The City further reserves the right to immediately terminate this Agreement upon: (1) the filing of a petition in bankruptcy affecting the Subrecipient; (2) a reorganization of the Subrecipient for the benefit of creditors; or (3) a business reorganization, change in business name or change in business status of the Subrecipient. 21. NOTICES. All notices or other communications required or permitted hereunder shall be in writing, and shall be personally delivered; or sent by overnight mail (Federal Express or the like); or sent by registered or certified mail, postage prepaid, return receipt requested; or sent by ordinary mail, postage prepaid; or telegraphed or cabled; or delivered or sent by telex, telecopy, facsimile or fax; and shall be deemed received upon the earlier of (i) if personally delivered, the date of delivery to the address of the person to receive such notice, (ii) if sent by overnight mail, the business day following its deposit in such overnight mail facility, (iii) if mailed by registered, certified or ordinary mail, five (5) days (ten (10) days if the address is outside the State of California) after the date of deposit in a post office, mailbox, mail chute, or other like facility regularly maintained by the United States Postal Service, (iv) if given by telegraph or cable, when delivered to -the telegraph company with charges prepaid, or (v) if given by telex, telecopy, facsimile or fax, when sent. Any notice, request, demand, HOME Program Subrecipient Agreement National City First Time Homebuyer Assistance Program Page 7 of 15 direction or other communication delivered or sent as specified above shall be directed to the following persons: To the City: To the Subrecipient: Alfredo Ybarra Community Development Manager City of National City 1243 National City Boulevard National City, CA 91950-4301 Gabe del Rio Senior Vice President of Lending 4305 University Ave, Suite 300 San Diego, CA 92105 Notice of change of address shall be given by written notice in the manner specified in this Section. Rejection or other refusal to accept or the inability to deliver because of changed address of which no notice was given shall be deemed to constitute receipt of the notice, demand, request or communication sent. Any notice, request, demand, direction or other communication sent by cable, telex, telecopy, facsimile or fax must be confirmed within forty-eight (48) hours by letter mailed or delivered as specified in this Section. 22. CONFLICT OF INTEREST AND POLITICAL REFORM ACT OBLIGATIONS. During the term of this Agreement, the Subrecipient shall not perform services of any kind for any person or entity whose interests conflict in any way with those of the City of National City. The Subrecipient also agrees not to specify any product, treatment, process or material for the project in which the Subrecipient has a material financial interest, either direct or indirect, without first notifying the City of that fact. The Subrecipient shall at all times comply with the terms of the Political Reform Act and the National City Conflict of Interest Code. The Subrecipient shall immediately disqualify itself and shall not use its official position to influence in any way any matter coming before the City in which the Subrecipient has a financial interest as defined in Government Code Section 87103. The Subrecipient represents that it has no knowledge of any financial interests that would require it to disqualify itself from any matter on which it might perform services for the City. If checked, the Subrecipient shall comply with all of the reporting require- ments of the Political Reform Act and the National City Conflict of Interest Code. Specifically, the Subrecipient shall file a Statement of Economic Interests with the City Clerk of the City of National City in a timely manner on forms which the Subrecipient shall obtain from the City Clerk. The Subrecipient shall be strictly liable to the City for all damages, costs or expenses the City may suffer by virtue of any violation of this Paragraph 22 by the Subrecipient. HOME Program Subrecipient Agreement National City First Time Homebuyer Assistance Program Page 8 of 15 23. HOME PROGRAM SUBRECIPIENT PROVISIONS. A. Use of HOME Funds. The HOME funds will be used to deliver a loan assistance program that will assist approximately 15-20 First-time Homebuyers and more as additional funds are made available for the Program. Exhibit "A" and the National City First Time Homebuyer Program Guidelines, Exhibit "B" provide a detailed description of the use of HOME funds under this Agreement. B. Affordability Period and Recapture. The loan must meet the HOME Program minimum affordability requirement of no less than 10 years for loans up to $40,000.00. The full amount of principal will be recaptured from the homebuyer during the 10 year affordability period if the property is transferred or sold. C. Affirmative Marketing Procedures. The Subrecipient shall adopt affirmative marketing procedures and requirements for all HOME assisted housing in compliance with 24 CFR § 92.351, as well as City's affirmative marketing responsibilities. Affirmative marketing steps consists, at a minimum, of actions to provide information and otherwise attract eligible persons from all racial, ethnic, and gender groups in the housing market area to the available housing assistance program The procedures and requirements must include methods for informing the public and owners about fair housing laws and policies so as to ensure that all individuals, without regard to race, color, national origin, religion, or sex are given an equal opportunity to participate in the program. The Subrecipient shall be solely responsible for the effective marketing responsibilities necessary to achieve Subrecipient's production goals set forth in Paragraph 2. D. Environmental Review. The City has assessed the activities carried out under this agreement in accordance with the provisions of the National Environmental Policy Act of 1969 (NEPA) and the related authorities listed in HUD's implementing regulations at 24 CFR parts 50 and 58. The City has determined that the activities described in the Scope of Work are exempt from environmental review as described at 24 CFR part 58.35(b)5. D. Displacement, Relocation, and Acquisition. The City will not provide financial assistance to any housing unit that is tenant occupied. To insure compliance with 24 CFR § 92.353, the Subrecipient and seller, and buyer will certify that any real property selected for HOME assistance is either owner -occupied or vacant three months before an offer to purchase is accepted by the seller. E. Procurement. Unless specified otherwise within this agreement, the Subrecipient shall procure all materials, property, or services in accordance with the requirements of 24 CFR 84.40-48. The Subrecipient will follow their written policy for procurement. F. HOME Program Conflict of Interest. No member, officer or employee of County or its designees or agents; no member of the governing body of the locality in which the Program is situated; and no other public official of such locality or localities, who exercises any functions or responsibilities with respect to the program funded hereunder during their tenure or for one year thereafter, shall have any interest, direct or indirect, in any Contract or subcontract, or the proceeds thereof, for work to be performed hereunder. Subrecipient agrees to incorporate, or cause to be incorporated, like language prohibiting such interest in all contracts and subcontracts hereunder. No officer, employee, member or program participant of HOME Program Subrecipient Agreement National City First Time Homebuyer Assistance Program Page 9 of 15 Subrecipient its contractors or its subcontractors shall have a financial interest, direct or indirect, in this Contract or the monies transferred hereunder or be financially interested, directly or indirectly, in the sale to Subrecipient of any land, materials, supplies or services purchased with any funds transferred hereunder, except on behalf of Subrecipient, as an officer, employee, member or program participant. Any willful violation of this paragraph with the knowledge, expressed or implied, of Subrecipient or its subcontractors shall render this Contract voidable by County. G. Lead -Based Paint Hazards. The Subrecipient agrees that any residential structures with assistance provided under this Agreement shall be subject to HUD Lead -Based Paint Regulations at 24 CFR Part 92.355. Such regulations pertain to all HOME -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 paint and explain the symptoms, treatment and precautions that should be taken when dealing with lead -based 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. H. Flood Disaster Protection. In accordance with the requirements of the Flood Disaster Protection Act of 1973 (42 U.S.C. 4001), the Subrecipient 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). Use and Reversion of Assets. If any assets purchased with HOME funds are sold, the proceeds will be considered as program income and will be used for eligible activities. J. Program Income. All program income produced or funds recaptured under this Contract Agreement and obtained by the Subrecipient shall be retained and revolved to fund new Program loans by the Subrecipient. The Subrecipient shall revert to the City any accounts receivable (outstanding loan balances) attributable to the use of funds under this agreement at the time of cancellation, expiration, or termination. K. Program Monitoring. In accordance with 24 CFR § 92.254, the City will monitor, no less than one (1) time per year, client eligibility for each assisted project. Each review shall also include, but not be limited to on -site inspections to determine compliance with all applicable property codes and standards. Subrecipient shall fully cooperate with the City in monitoring the effectiveness and work performed by the Subrecipient in compliance with the terms of the Agreement. City shall have access at a reasonable hour to all offices and records (dealing with the use of funds that are the basis of this Agreement) of Subrecipient, it officers, directors, agents, employees, and subcontractors for the purposes of such monitoring. City shall give Subrecipient reasonable notice for accessing offices and records. HOME Program Subrecipient Agreement National City First Time Homebuyer Assistance Program Page 10 of 15 L. Uniform Administrative Requirements. Subrecipient agrees to comply with the HOME requirements 24 CFR § 92.505 and the requirements and standards of OMB Circular A-122, "Cost Principles for Non -Profit Organizations" and with the following Attachments to OMB Circular No. A-110 and any changes to either Circulars. It is understood that all items below may not be applicable to Subrecipient's operations: 1. Attachment A, "Cash Depositories," except for Paragraph 4 concerning deposit insurance; 2. Attachment B, "Bonding and Insurance"; 3. Attachment C, "Retention and Custodial Requirements for Records"; 4. Attachment F, "Standards for Financial Management Systems"; 5. Attachment H, "Monitoring and Reporting Program Performance," paragraph 2; 6. Attachment N, "Property Management Standards," except for paragraph 3 concerning the standards; 7. Attachment 0, "Procurement Standards"; and 8. Attachment P, "Audit Requirements." Audits must be conducted in accordance with 24 CFR Part 44 and OMB Circular A-133. M. Retention of Records. Subrecipient agrees to keep or cause to be kept an accurate record of all actions taken and all funds expended, with source documents, in the pursuit of the objectives of the performance of this Agreement. Such records shall be kept for a minimum of five (5) years beyond the close of this Contract. Subrecipient also agrees to obtain and keep on file and available for inspection by City the following information on each household assisted under this Agreement: A. annual income and size of the household; B. ethnic group of the client; C. whether the head of household is male or female; D. additional statistical information as may be required by HUD regulations and any amendments thereto; E. proof the subject property meets the applicable property standards F. the total per unit amount of HOME dollars invested; G. the compliance with the affirmative marketing requirements and existence of acceptable procedures; H. compliance with relocation requirements; I. minority and female -owned business data, and affirmative fair housing actions; J. compliance with lead based paint regulations and guidelines; K. compliance with conflict of interest rules; and I. evidence the income targeting requirements are met. N. Enforcement of the Agreement. If assisted housing does not meet the applicable requirements under 24 CFR § 92.254 the funds provided to the assisted project must be repaid to the Subrecipient within 30 days of failure to comply. Specific property recapture provisions to maintain the principal residency period must be stated in the HOME agreement between the homebuyer and the Subrecipient and filed of public record at the close of escrow. HOME Program Subrecipient Agreement National City First Time Homebuyer Assistance Program Page 11 of 15 O. Hatch Act. The Subrecipient 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 U.S.C. P. Conflict of Interest. The Subrecipient agrees to abide by the provisions of 24 CFR 84.42 and 570.611, which include (but are not limited to) the following: a. The Subrecipient 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 Subrecipient 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 CDBG-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 CDBG-assisted activity, or with respect to the proceeds from the CDBG-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 Subrecipient, or any designated public agency. Q. Lobbying. The Subrecipient 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, 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 HOME Program Subrecipient Agreement National City First Time Homebuyer Assistance Program Page 12 of 15 c. It will require that the language of paragraph (d) of this certification be included in the award documents for all sub awards at all tiers (including subcontracts, sub grants, and contracts under grants, loans, and cooperative agreements) and that all Subrecipients shall certify and disclose accordingly: d. 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. R. Conditions for Religious Organizations. If applicable, the Subrecipient must meet the conditions in 24 CDF Part 92.257 regarding the use of HOME funds involving a primarily religious entity. S. Closeout. HOME funds will be closed out in accordance with procedures established by HUD. 23. MISCELLANEOUS PROVISIONS. A. Computation of Time Periods. If any date or time period provided for in this Agreement is or ends on a Saturday, Sunday or federal, state or legal holiday, then such date shall automatically be extended until 5:00 p.m. Pacific Time of the next day which is not a Saturday, Sunday or federal, state or legal holiday. B. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, together, shall constitute but one and the same instrument. C. Captions. Any captions to, or headings of, the sections or subsections of this Agreement are solely for the convenience of the parties hereto, are not a part of this Agreement, and shall not be used for the interpretation or determination of the validity of this Agreement or any provision hereof. D. No Obligations to Third Parties. Except as otherwise expressly provided herein, the execution and delivery of this Agreement shall not be deemed to confer any rights upon, or obligate any of the parties hereto, to any person or entity other than the parties hereto. E. Exhibits and Schedules. The Exhibits and Schedules attached hereto are hereby incorporated herein by this reference for all purposes. F. Amendment to this Agreement. The terms of this Agreement may not be modified or amended except by an instrument in writing executed by each of the parties hereto. G. Waiver. The waiver or failure to enforce any provision of this Agreement shall not operate as a waiver of any future breach of any such provision or any other provision hereof. H. Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California. Entire Agreement. This Agreement supersedes any prior agreements, negotiations and communications, oral or written, and contains the entire agreement between the parties as to the subject matter hereof. No subsequent agreement, representation, or promise made by either party hereto, or by or to an employee, officer, agent or representative HOME Program Subrecipient Agreement National City First Time Homebuyer Assistance Program Page 13 of 15 of any party hereto shall be of any effect unless it is in writing and executed by the party to be bound thereby. J. Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the successors and assigns of the parties hereto. K. Construction. The parties acknowledge and agree that (i) each party is of equal bargaining strength, (ii) each party has actively participated in the drafting, preparation and negotiation of this Agreement, (iii) each such party has consulted with or has had the opportunity to consult with its own, independent counsel and such other professional advisors as such party has deemed appropriate, relative to any and all matters contemplated under this Agreement, (iv) each party and such party's counsel and advisors have reviewed this Agreement, (v) each party has agreed to enter into this Agreement following such review and the rendering of such advice, and (vi) any rule or construction to the effect that ambiguities are to be resolved against the drafting party shall not apply in the interpretation of this Agreement, or any portions hereof, or any amendments hereto. 24. ATTACHMENTS TO THE SUBRECIPIENT AGREEMENT Exhibit A: Scope of Work Exhibit B: National City First Time Homebuyer Assistance Program Manual Exhibit C: Subrecipient Insurance HOME Program Subrecipient Agreement National City First Time Homebuyer Assistance Program Page 14 of 15 IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date and year first above written. CITY OF NATIONAL CITY on Morrison, Mayor APPROVED AS TO FORM: i George H. Eiser, III City Attorney COMMUNITY HOUSINGWORKS LENDING, INC B Its: Pr- sident del Rio Sr. Vice President HOME Program Subrecipient Agreement National City First Time Homebuyer Assistance Program Page 15 of 15 National City First -Time Homebuyer Assistance Community HousingWorks Realty & Lending Scope of Work, Exhibit "A" EXHIBIT "A" SCOPE OF WORK Program Design and Scope for the National City Homebuyer Assistance Program CHW R & L will provide a unique and experienced system, called full -cycle -lending, that will promote, educate, counsel and assist first time homebuyers (FTHB) through the entire process. For new buyers, mortgage banking is unfamiliar and often complicated. In the traditional environment, FTHBs are often shuffled around and present as easy targets to be taken advantage of. Our comprehensive first time home buyer program ensures that these vulnerable new buyers are educated, prepared, and qualified to purchase a new home. With the surge of Foreclosures and Notices of Default, CHWR & L has strengthened our Post Purchase counseling services with 16 new FT positions and link to a national hotline for triage services for our clients. CHWR & L's staff, whether from Counseling to Loan Servicing, are highly trained and certified in their fields. CHWR & L is consistently recognized on a national level for our expertise and best practices. The approach to the National City Homebuyer Assistance Program in meeting the lending needs of FTHBs through a uniquely enhanced service delivery model is outlined below: • Outreach: CHWR & L will provide neighborhood outreach via flyers and brochures in various locations of high civic traffic in the City of National City Homebuyer Assistance Program on a quarterly basis. All of our County -wide marketing materials, event participation and orientation seminars will include the information on the National City Homebuyer Assistance Program. • Education: CHWR & L will continue to provide our 8+hour HUD and NeighborWorks Certified Home Buyer Education in English and Spanish for interested residents of National City Homebuyer Assistance Program, with an increase of at least two classes per year in a National City location. Classes are also held in our City Heights office, just a 10 minute drive from National City almost every Saturday all year long. We welcome the City to refer any interested agencies and organizations to CHWR & L to co -brand or organize a class in National City. (National City Homebuyer Assistance Program Specific reports provided quarterly.) • Counseling: CHWR & L will continue to provide Pre and Post -Purchase Counseling to residents of National City I-Iomebuyer Assistance Program at no charge. With the addition of this contract, CHWR & L will monitor all National City Homebuyer Assistance Program loan program portfolio clients and provide specialized outreach for loss mitigation and homeownership preservation. • Lending: CHWR & L will administer the National City Homebuyer Assistance Program homeownership loan program according to the program guidelines provided. This will include taking applications for the program, underwriting, loan document preparation and loan closing. CHWR & L will provide one-on-one in person client intake and applications for the National City Homebuyer Assistance Program down -payment assistance applicants, while leveraging the City's funds by pre -qualifying the client for any and all other assistance possible through CHWR & L if available and if necessary. - 1 - National City First -Time Homebuyer Assistance Community HousingWorks Realty & Lending Scope of Work, Exhibit "A" Pre -qualification group appointments will be made after a client has graduated any 8-hour HUD certified Home Buyer Education course offered by most HUD approved agencies. o National City may choose to retain the funds until loan closing and billing from CHWR & L for reimbursement and payment, OR National City may choose to forward the loan funds to CHWR & L for restricted-use/investor account management. o Enumeration to CHWR & L for lending, counseling, education and all other services provided to clients by CHWR & L will be paid by the City of National City Homebuyer Assistance Program at such a time and rate as $1,350 per closed loan. (Billed within 30 days of loan closing) o The only suggestion that CHWR & L would make to the National City Homebuyer Assistance Program would be to use simple interest rather than shared equity so that the loan can be used with far more 1st mortgage programs, such as CalHFA or other affordable first loans. In any case we are happy to manage the program as presented, and provide feedback if the changes are necessary for the program's success. 0 THE HOME BUYING` PROCESS Home Buyer Education �HBB) Financial Fitness Pre -Purchase Counseling Loan Application and Pro -Approval Loan Closing and Home pvrnershipl CLIENT FLOW: 1. Client calls for information and is referred to take CHWR & L or any other HUD certified HBE and/or Financial Fitness training. 2. Client schedules a Group Pre -qualification Counseling appointment with CHWR & L for a Pre - Purchase Counseling session and Pre - Qualification. 3. Mortgage -ready applicants are offered choices for 1st mortgage Lenders and the Loan Application Process begins. 4. CHWR & L underwrites all applications to program guidelines, taking all approved transactions through closing. -2- National City First -Time Homebuyer Assistance Community HousingWorks Realty & Lending Scope of Work, Exhibit "A" Objective Activities Timeline / Reports & Billing Staff 1) Quarterly distribution of flyers Provide outreach materials and brochures highlighting the • Quarterly • HOC Assistant and offers for orientation program and upcoming • Production • Home Buyer sessions throughout high- civic traffic locations in National City Homebuyer events/opportunities in locations around C.V. such as; Housing Dept, Libraries, Bill Payment, Municipal Report Quarterly Education Team Assistance Program in both Bldgs. English and Spanish. 2) Provide Orientations Seminars to all interested groups in the area 3) Participate in all appropriate fairs and community events Provide Home Buyer Education Educate National City classes and subsequent pre- • Ongoing (3- • Home Buyer Homebuyer Assistance qualification rallies each week in 5/month) Education Team Program families on the City Heights and alternating off- • Production ■ Director of process of homeownership sites through the County. At least 2 Report Education and through our HUD certified classes per year will be held in Quarterly Counseling Home Buyer Education in National City Homebuyer • Client Services English and Spanish. Assistance Program Coordinator 1) Pre -Purchase counseling Provide both Pre and Post provided to all HBE graduates. • Ongoing • AVP of Education Purchase Counseling to 2) Post -purchase counseling • Production and Counseling residents of National City provided to National City Report • Senior Client Homebuyer Assistance Program in both English and Spanish. Homebuyer Assistance Program homeowners with targeted efforts to National City Homebuyer Quarterly Services Coordinator Assistance Program loan portfolio clients 1) Applications taken through pre - Administer FTHB-HOME qualification sessions in CHWR & • Ongoing • AVP Lending Down -payment Assistance L office offered by appointment to • Production • Loan Loan Programs according HUD -certified graduates of Home Report CoordinatoriCloser to guidelines. Buyer Ed. Quarterly • Loan Underwriter 2) Underwriting, closing and funding provided by CHWR & L. Billing upon loan closing 1) Priority given for face-to-face Special Post -Purchase counseling sessions for National • Ongoing • AVP Lending Foreclosure Prevention City Homebuyer Assistance • Quarterly • HOC Assistant Efforts for National City Program residents. reporting • Client Services Homebuyer Assistance 2) Special outreach using Ad Coordinator Program. Council campaign for National City Homebuyer Assistance Program residents. • AVP of Education and Counseling 3) Joint outreach efforts with city billing departments. - 3 - National City First -Time Homebuyer Assistance Community HousingWorks Realty & Lending Scope of Work, Exhibit "A" Program Budget ■ $1,350.00 fee per closed loan to CHWR & L for all outreach, counseling, education and lending services associated with that loan and client, with a 3% annual increase on loan and program fees. • Annual Services Fee of $13,000.00 for program set up and origination of CHWR & L / National City Homebuyer Assistance Program Loan Program, guidelines and lender training, Special Post Purchase Program for National City Homebuyer Assistance Program, Education, Counseling, and Quarterly Outreach Materials throughout National City Homebuyer Assistance Program. • Initial capital for lending National City Homebuyer Assistance Program FTHB funds program or a $35 per loan fee (wiring fee) if CHWR & L provides initial funds for loan with a "net 30" due after funding of total loan amount extended by CHWR & L. • $50 per loan annual servicing fee for years 2-onward, 1st year's fee covered by $750 one- time setup fee for each new loan originated and serviced by CFIW on behalf of National City. Servicing with include the annual occupancy certification as well as all loan set up fees, lifetime post purchase / default counseling as well as post purchase credit and loan underwriting, skip tracing and collections (if necessary) and recommendations to the City of National City on all options in the event of default. Reporting • Quarterly Production and Activity Reports for all of National City Homebuyer Assistance Program on: o General Outreach (including locations) o Home Buyer Education Graduates o Pre -Purchase Counseled Clientele o Post -Purchase Counseled Clientele o National City Homebuyer Assistance Program FTHB Funds Pipeline Report o Special Foreclosure Prevention Program Updates • Annual or Quarterly Loan Servicing Report for National City Homebuyer Assistance Program Portfolio (if option chosen) ■ Billing sent monthly along with quarterly reporting and backup. -4- Exhibit B: National City FTHB Assistance Program Manual CALIFORNIA LCII y INCORPORATED FIRST-TIME HOMEBUYER ASSISTANCE PROGRAM MANUAL Shared Equity: Down payment and Closing Cost Assistance City of National City Community Development Department Housing and Grants Division 1243 National City Blvd. National City, CA 91910 (619) 336-4391 (619) 336-4286 Fax EFFECTIVE: June 22, 2010 (Subject to change) EQUAL HOUSING OPPORTUNITY Exhibit B: National City FTHB Assistance Program Manual TABLE OF CONTENTS Effective June 22, 2010 PURPOSE OF THE PROGRAM MANUAL GENERAL DEFINITIONS SECTION I -BORROWER ELIGIBILITY REQUIRMENTS A. ELIGIBLE BORROWER B. INCOME CRITERIA C. HOUSEHOLD ELIGIBILITY REQUIREMENTS D. ELIGIBLE PROPERTIES E. MAXIMUM PURCHASE PRICE F. LOAN PROCEDURES AND TERMS SECTION II -PROGRAM ADMINISTRATION AND PROCEDURES A. LENDER ELIGIBILITY B. LOAN ORIGINATION AND PROGRAM APPLICATION C. CITY APPLICATION PACKET D. PROPERTY INSPECTION E. CITY PROCESSING F. LOAN CLOSING G. CANCELLATION AND COMMITMENT EXPIRATIONS SECTION III- CHANGES PRIOR TO CLOSING APPENDIX A -INCOME APPENDIX B-SEQUENCE OF LOAN PROCESS APPENDIX C-CITY LOAN QUALITY COMMITMENT POLICY APPENDIX D-SECTION 8 HOUSING QUALITY STANDARDS (HQS) APPENDIX E-SHARED EQUITY EXAMPLE 2 Exhibit B: National City FTHB Assistance Program Manual PURPOSE OF THE PROGRAM MANUAL The purpose of this Program Manual is to describe the program and delineate the role of the City, Community HousingWorks Realty & Lending, Inc. ("CHWR & L"), the applicant/borrower and the lenders. This document contains a description of the City of National City First -Time Homebuyer Program requirements, processing procedures and program administration. Loan processing forms are contained in a separate document. The City may revise these guidelines from time to time. Public notice will be given for significant program changes before adoption. The City encourages all eligible homebuyers to apply. Participating lenders are expected to be well informed about all the restrictions contained in this manual so that both applicants and sellers are aware of these restrictions before the application is accepted. The lender will reject those applications where the information submitted indicates that the applicant does not qualify for the program. GENERAL DEFINITIONS AFFIDAVIT: A deposition filed in connection with the program made under oath and subject to penalties of perjury APPLICANT: Any person who applies for City loan assistance ASSETS: Cash or a non -cash item that can be converted to cash. Assets exclude necessary personal property CITY: The City of National City Community Development Department COMMITMENT: A document, which is originated and issued by the City, based on review and approval of the application package and lender's certification that the requirements necessary for issuance of a City loan have been met. A commitment will be valid for 120 days. THE CITY WILL ONLY ISSUE A COMMITMENT FOR A LOAN THAT HAS BEEN APPROVED BUT NOT YET FUNDED. NO EXCEPTIONS WILL BE MADE. COMMUNITY HOUSINGWORKS REALTY & LENDING, INC (CHWR & L): City selected contractor that will process, underwrite, close, and package, and service the loan. ELIGIBLE BORROWER: Any person meeting the criteria as set forth in this manual ELIGIBLE DWELLING: Real property located within the City of National City. This may include a residential unit to be built, a new unit, or an existing. The unit must be designed as a residence for one household and must meet property standards and criteria as set forth in this manual EQUITY: The dollar amount that constitutes the difference between the sales price of the Property and the sum of the following amounts; 1) principal on the First Note and Deed of Trust; 2) principal on the Second Note and Deed of Trust to the City of National City; 3) all costs of sale, including costs of brokers' commissions, escrow fees, title costs and fees, recording costs, etc.; 4) current year taxes, including all real estate taxes calculated to the date of sale; 5) borrower's down payment not including the loan from the City to Borrower; 6) costs of any capital improvements to the Property, provided such improvements were approved by the City prior to construction and provided that such improvements have been documented to the satisfaction of the City 3 Exhibit B: National City FTHB Assistance Program Manual EQUITY SHARE: The equity share starts at 50%/50% between the Borrower and the City. The amount of the Borrower's share in the Equity of the Property shall increase by five percent (5%) per year, measured on the anniversary date of the Deed of Trust. Correspondingly, the City's share in the equity of the Property shall decrease by five percent (5%) per year. In the event that no Equity exists at the time of transfer or sale, the City loan (HOME funds) will still be due and payable. In the event that a negative Equity situation exists, and the full amount of the City loan is not available to be recaptured, the amount of the loan required to be repaid to the City will be set forth in the HOME agreement between the Borrower and the City. A Shared Equity example is attached as Appendix E. EXISTING HOME (RESALE HOME): A dwelling unit that has been previously occupied. HOME FUNDS/HOME INVESTMENT: Funds received pursuant to the HOME Investment Partnership program under the Department of Housing and Urban Development (HUD), codified at 42.U.S.C. Section 12701, et seq., 24 CFR Part 92, to provide funds for affordable housing HOMEOWNER INVESTMENT: Homeowner's down payment and any capital improvement investment made by the owner since purchase INCOME: The gross amount of all taxable income for all mortgagors and adult household members that is anticipated to be received during the coming twelve (12) months. All income derived from any source, including income from wages (gross pay), overtime, pensions, veteran's compensation, bonuses, public assistance, alimony, net rental income, dividends and interest, etc. must be included. Non-taxable income must be listed, but bracketed, in order to exclude this income from the annual family income calculation; verification of non-taxable status may be required. ISSUER: The City of National City through the Community Development Department of the City of National City LENDER: A financial institution, whether broker, retail, or wholesale, licensed to provide mortgage loans in the State of California. The institution must meet all the requirements established by the City in order to participate as a lender in the City program LOAN: An extension of credit provided to an Eligible Borrower to finance the purchase of an Eligible Dwelling LOW-INCOME: A household with income at or below 80% of the Area Median Income as established by the U.S. Department of Housing and Urban Development. Every 12-18 months, the U.S. Department of Housing and Urban Development updates these figures NEW HOME: A dwelling unit that is proposed to be constructed, is currently under construction, or exists but has not been previously occupied NET PROCEEDS: Sales price minus loan repayment and closing costs OWNERSHIP: Any of the following interests in residential property: fee simple interest; joint tenancy; tenancy in common; interest of a tenant -shareholder in a cooperative; life estate; interest held in trust for the Applicant that would constitute a present ownership interest if held by the Applicant 4 Exhibit B: National City FTHB Assistance Program Manual PRINCIPAL RESIDENCE: Residence must be occupied as the primary home of the buyer and be defined as one of the following types of residences: 1) single-family house; 2) condominium unit; 3) town home unit PROHIBITED MORTGAGE: Subordinate mortgages and any liens superior to the City First - Time Homebuyer loan, other than the new first Trust Deed. PROPERTY STANDARDS: Minimum performance standards a property must meet for program eligibility. Standards are established in 24 CFR Part 882 (Housing Quality Standards), as attached as Appendix D PROPERTY VALUE: Value of the eligible property as determined by a certified appraisal PURCHASE PRICE: Cost of acquiring the residence, excluding usual and reasonable settlement or finance costs, and the value of services performed by mortgagor in completing the acquisition RELATED PERSON: Any party(ies) who may have a beneficial interest in the sale or financing of the subject property, other than a qualified lender SINGLE-FAMILY RESIDENCE: Housing unit intended and used for occupancy by one household 5 Exhibit B: National City FTHB Assistance Program Manual SECTION I BORROWER ELIGIBILITY REQUIREMENTS Both federal and state law sets borrower eligibility requirements. Income guidelines are modified, based on federal directives every twelve to eighteen months. The City will notify the Lenders when those changes take place, including the effective date of each change. In an attempt to assure that all requirements are clear, the First-time Homebuyer Application and Affidavit are required to be signed by each Applicant and must be included in the Application Package submitted to the City. A. ELIGIBLE BORROWERS 1. Qualified applicants must be first-time homebuvers. The Applicant may not have held an ownership interest in his/her Principal Residence within the past thee years. This timeframe includes those 36 months before the date the mortgage is executed. In the case of a married couple, both parties must meet this requirement. The buyer, spouse and any other parties who will be listed on title must meet this requirement. The Lender must verify this through his/her examination of the Applicant's federal tax returns for the preceding three years. The Applicant(s) cannot have claimed a deduction for mortgage interest or taxes on real property claimed as a Principal Residence. 2. To demonstrate compliance with this requirement, Applicants must complete and sign the First-time Homebuyer Application and Affidavit and provide copies of their last three (3) years signed federal tax returns (or acceptable alternative exhibits). a) The Applicant(s) can provide the signed 1040A 1040EZ or 1040 federal income tax forms for the preceding years, including all schedules. These forms shall be submitted to the Lender and forwarded to the City with the completed loan application. The tax returns must be signed and dated in blue ink by the Applicants. b) If the Applicant(s) has/have filed the short form, 1040A or 1040EZ for the last three (3) years, completes and signs the required affidavits, but is unable to produce copies of the signed returns, the City will accept a completed copy of IRS Letter Form 1722 in lieu of actual returns. The Applicant may request this letter, free of charge, from the local IRS Office. The Letter 1722 must include the signature of a representative of the IRS. Letter Form 1722 should include the following information: Name and social security number ii. Type of return filed Marital status iv. Tax shown on return v. Adjusted gross income vi. Taxable income vii. Self-employment tax viii. Number of exemptions c) In the event the Applicant(s) was not obligated to file federal income tax returns for any of the preceding three (3) years, it will be necessary for the Lender to obtain a completed and signed Income Tax Affidavit from the Applicant, which is required in place of the above. This document is to be forwarded to the City with the application package. d) If either copies of the required tax returns or the 1722 Form cannot be obtained, the Lender may be able to help the Applicant establish first-time homebuyer status with copies of utility bills and a signed and notarized statement from the Applicants landlords for the previous three years. e) When the Commitment is issued during the period between January 1 and February 15 and the Applicant has not yet filed his/her/their Federal Income Tax Return for the preceding 6 Exhibit B: National City FTHB Assistance Program Manual year, the City may rely on an affidavit. The affidavit must affirm that the Applicant is not entitled to claim deductions for taxes or interest on a principal residence for the preceding year. After February 15, a tax return will be required. 3. Upon close of escrow, the buyer must occupy the home as their Principal Residence. 4. Applicant(s) need not be a U.S. citizen. Legal resident aliens are eligible to apply but must show proof of status. 5. City of National City employees are eligible to participate. B. INCOME CRITERIA 1. Income must be at or below 80% of the currently published San Diego County median income, adjusted for household size. Income limits have been established by the U.S. Department of Housing and Urban Development and are adjusted annually. In accordance with this requirement, applicants may not obtain "stated income" loans. The true income must be a qualifying factor in loan approval. Household Size Annual Income 1 person $ 44,000 2 people $ 50,250 3 people $ 56,550 4 people $ 62,800 5 people $ 67,850 6 people $ 72,850 7 people $ 77,900 8 people $ 82,900 Effective April 2010 2. Gross income is calculated by taking the Applicant's anticipated adjusted gross monthly income, at the time of application, and multiplying it by twelve. Adjusted gross income includes the gross amount of all taxable income, before payroll deductions of: wages, salaries, commissions, fees, tips and bonuses, alimony, public assistance, etc. The adjusted gross income also includes the income earned on assets, such as dividends earned on stock and interest earned on savings and checking. The adjusted gross income qualification is pursuant to the 24 CFR 92.203(b)(3) for reporting under the IRS Form 1040 series for individual federal annual income tax purposes. Gross income includes the combined taxable adjusted gross income of all mortgagors and all other adult members of the household. a. Self -Employed or Seasonal Employees: The formula that the Lender uses to determine the anticipated gross monthly income of self-employed and/or seasonal workers is acceptable provided that all income as described in this manual is included in the calculation. b. Co-Borrower/Co-Mortgagor: If a co -borrower or co -mortgagor will be on both the title and the deed of trust, his/her income must be included in determining eligibility for the program. The IRS regulation states "income to be taken into account in determining gross income is income of the mortgagor(s) and any other person who is expected to both live in the residence being financed and to be secondarily liable on the mortgage." c. Spouses: Married couples are treated as co -applicants, whether: 1) they are separated; 2) either spouse is applying for the loan; or 3) either spouse plans to be named on title. Exhibit B: National City FTHB Assistance Program Manual d. Computing Income i. Program Computation vs. Mortgage Underwriter's Computation: The City loan figure represents ANTICIPATED income, while the Lender's figure represents income AVERAGED over the last few years and the City program requires that every source of taxable and non-taxable income be listed on the Income Computation Worksheet, however, non-taxable income should be bracketed and not added into the maximum annual family income calculation. ii. Income Parameters: See Appendix A of this manual for examples of sources of income, which must be considered in computing buyer income. iii. Military Pay: See Appendix A of this manual for Military Pay explanations. iv. Self -Employed: Year-to-date profit and loss statement and three prior year's tax returns are required. v. Other Income: Sources of income other than wages must be documented by third party verifications. In cases where the third party fails to respond, acceptable alternative sources of documentation can be determined on a case -by -case basis and should follow standard FNMA income verification guidelines. vi. Documentation: In cases where the Applicant is employed, acceptable sources of documentation used to verify income include a recent pay stub with year-to-date earnings and an employer Verification of Earnings statement (VOE). If the application is taking place during the first four months of the year, a year-to-date total may be insufficient. The Lender must supplement the pay stub information with the prior year W-2 statement and/or tax returns. On some pay stubs, the year-to-date earnings include pay from the last part of the prior year. If this is determined to be the case, request that the employer submit a signed statement of verification of exact year-to-date income. Miscalculation can result in the determination of excess income and disqualification of the buyer. vii. Income Verification: The Lender bears the burden of proving that the Buyer's income is within the program guidelines. The computation should be clear, complete, and documented by third party verifications, to the greatest extent possible. viii. No Income: Adult members, 18 years and older, of the household who have no income must complete and sign the Declaration of No Income form. 8 Exhibit B: National City FTHB Assistance Program Manual C. HOUSEHOLD ELIGIBILITY REQUIREMENTS 1. Households shall have sufficient income and credit -worthiness to qualify for primary financing from a participating lender. 2. Households will be required to provide a down payment or cash investment. A minimum contribution of 3% of the total purchase price of the property will be required from the borrower's personal funds and must be used for down payment, closing costs or cash reserves, no gifts. 3. Maximum liquid assets after down payment and closing cost contribution may not exceed $25,000. D. ELIGIBLE PROPERTIES 1. Properties must be located within the City of National City limits. 2. Properties can be new or resale single-family homes, including detached homes, condominiums and townhouses. Duplexes, triplexes or fourplexes do not qualify as eligible properties. 3. The seller must certify that the property be owner -occupied or vacant for at least 3 months before signing a purchase contract agreement. The City will not provide assistance on a unit that is tenant occupied and will not incur costs for tenant relocation. 4. Properties must meet local code inspection standards upon occupancy. See Appendix D for detailed Housing Quality Standards. 5. Properties built prior to 1978 must meet compliance with lead -based paint regulations for Notification, Evaluation and Reduction of lead -based paint hazards in federally owned property and housing receiving assistance; Final Regulation (September 15, 1999) [24 CFR Part 35] E. MAXIMUM PURCHASE PRICE The maximum purchase price cannot exceed 95 percent (95%) of the median purchase price for the area, as determined by the U.S. Department of Housing and Urban Development (1 unit-$332,500, effective 6/10). F. LOAN PROCEDURES AND TERMS 1. The maximum loan amount shall be 20% of the purchase price up to $40,000 subject to the condition of the property, qualifying factors and staff assessment. Up to 2% of the purchase price may be funded by the City loan toward payment of closing costs. The City loan may be used toward the down payment, closing costs, an interest rate buy -down or any combination thereof. 2. The maximum CLTV (combined loan to value) of the City and the new 1st Trust Deed loans shall not exceed the maximum approved CLTV required by the 1st mortgage lender. 3. Non -occupant co -borrowers shall not be allowed. 4. Total housing ratio (PITI) cannot exceed 36% of Applicant(s) gross monthly income. The City may make exceptions if less than twenty percent payment shock is involved. 5. Total debt -to -income ratio may not exceed 450/0 or 41% if obtaining an FHA loan. 6. No prepayment penalty allowed. 7. Maximum fees to the Applicant of 1.25% origination, discount points for below par pricing only, and $350 processing are acceptable for the purchase transaction. No other Broker or Admin type fees allowed. Other third party fees that are reasonable and customary are allowable. 9 Exhibit B: National City FTHB Assistance Program Manual 8. The terms of the City's second trust deed are designed to encourage long-term residency in the program -assisted home. No interest is charged on the loan (except in the case of default). Instead, the program is based on an equity share. The amount of equity due to the City is based upon the number of years after the date of execution of the City's loan. It begins at 50% of the equity and decreases by 5% each year. After 10 full years of owner occupancy, there is no equity share. Only the principal remains due and payable. See shared equity example in Exhibit E. 9. The loan shall become due and payable at the time of the property's transfer of title, refinance (except as earlier defined), rental or sale. 10.The loan shall also become due and payable when the acceleration clause is triggered. The acceleration clause will be in effect when the property is no longer the principal place of residency of the eligible homebuyer, or upon discovery of willful misrepresentation or fraud in connection with the program. Rental of the property is prohibited and will cause the loan to be accelerated. 11. Second and subsequent mortgages to the new First Trust Deed, except for this City Loan, are not permitted. 12.The loan is not assumable. 13. A Promissory Note and Deed of Trust will secure the loan. 14. The City Loan can be used with conventional, FHA, VA, and other loans issued be a qualified lender, except adjustable rate mortgages with less than five years fixed, negative amortization and stated income mortgages. 15.The City of National City Community Development Department does not underwrite the loans. Lenders will process the underlying mortgages using standard procedures, with adjustments to those procedures to conform to the City loan guidelines. 10 Exhibit B: National City FTHB Assistance Program Manual SECTION II PROGRAM ADMINISTRATION AND PROCEDURES Eligible Applicants will apply for the City of National City's First -Time Homebuyer Program in conjunction with normal mortgage loan application procedures. The City loan application must be filed with an application for a mortgage to a Participating Lender. The City loan processing procedures are designed to coincide with the standard mortgage loan processing and underwriting criteria that are in place at most mortgage lending institutions, although there are some City restrictions that must supercede normal processing and underwriting criteria. Recognizing that there are procedural variations among participating lenders, the steps outlined here are meant to serve as sequential guidelines. Please note, however, that all elements of the processing sequence must be completed at some point. A. LENDER ELIGIBILITY A lender is defined as a financial institution, whether broker, retail, or wholesale, licensed to make first mortgage loans in the State of California. All Lenders who wish to participate in the City program must be enrolled as a participating lender. To enroll and maintain active status a lender must: 1. Attend a lender certification course by CHWR & L 2. Agree to adhere to Quality Commitment Policy. Please refer to Appendix C. 3. Designate a contact person for the program 4. Pay a lender annual certification fee of $250.00 for each loan officer and attend at least one training class in person prior to being approved. 5. All lending personnel involved with the City program must attend City training sessions and study and apply procedures listed in the Lender Training Handbook 6. Provide the First-time Homebuyer Program Manual and Lender Training Handbook to all loan processors 7. Cooperate with City Housing staff in providing the best possible service to the Applicants The Lender will be required to submit certification that no material misstatements appear in the application and program documents. If the Lender becomes aware of such, whether negligently or willfully made, he/she must notify the City immediately. The Lender should also be aware and inform the Applicant of penalties provided by California law if a person makes a false statement or misrepresentation for the sole purpose of participating in this program. Housing staff will take all lawful actions to correct or mitigate the problem. B. LOAN ORIGINATION AND PROGRAM APPLICATION 1. Borrower applies to the Lender for a mortgage and City loan. Lender performs standard underwriting procedures to qualify Applicant for a first mortgage, utilizing the City's required underwriting requirements in lieu of certain standard criteria. 2. Lender describes parameters of the City program to Applicant and determines eligibility based on a review of income, prior homeownership and all other factors listed in this manual. 3. Lender obtains three prior year's tax returns from Applicant and prepares to have the Seller Affidavit forwarded with instructions to the seller. 4. Lender gives the Applicant a copy of the City's First -Time Homebuyer Application and Affidavit. This document serves as the formal application to the City and contains the required certifications below: a. That the residence will be used as the Principal Residence and that the Applicant must notify the City when the home ceases to be the Principal Residence 11 Exhibit B: National City FTHB Assistance Program Manual b. That the Applicant has not had an ownership interest in a Principal Residence during the three year period prior to the date of application c. That this is a new mortgage loan* d. That the loan applied for does not constitute a prohibited mortgage* e. That the Applicant was not forced to apply through a particular Lender f. That the Applicant's gross annual household income does not exceed permitted income limits g. That no interest is being paid to a related person* h. Acknowledgment that any material misstatement or fraud is made under penalty of perjury *New Mortgage Requirements: The Lender and the Applicant, using the Program Affidavits, state that the mortgage being acquired in connection with the loan will not be used to acquire or replace an existing mortgage or land contract. *Prohibited Mortgages: Any liens superior to the City First -Time Homebuyer Loan, other than the new first Trust Deed, are not allowed under any circumstances. *No Interest Paid to Related Persons: No interest on the mortgage (or certified indebtedness) may be paid to a person who is a "Related Person", any party(ies) who may have a beneficial interest in the sale or financing of the subject property, other than the qualified Lender. C. APPLICATION PACKET Lender transmits an application packet to the CHWR & Lhat includes the following forms and additional documentation as required: 1. City First -Time Homebuyer Application and Affidavit* 2. Complete copy of Lender's First Mortgage Loan Application 3. Income Computation Worksheet and all supporting documentation* 4. Most recent 30-day bank statement 5. Lead -Based Paint Disclosure* 6. Copy of Signed Receipt of Disclosures 7. Seller Affidavit* 8. Purchase Contract and all Addendums signed by all parties 9. Appraisal and 1004D 10. Copy of Title Report 11.Three years of Federal Income tax Returns and/or Declaration of No Income Affidavits* for a three-year period 12. Funding Request and Escrow Information Sheet* 13. Letter of Assignment (if the Funding Lender is different than the Originating Lender: A copy of the Notice of Transfer signed at closing or a letter on company letterhead with the name, address, phone and fax number of the Funding Lender along with the date the assignment is being made will be sufficient) 14. Certificate of Completion for First -Time Homebuyer Education Training Course 15. Signed and executed copy of the Power of Attorney if applicable 12 Exhibit B: National City FTHB Assistance Program Manual Submission of the above mentioned forms/documents to the City constitutes completion of the APPLICATION PACKAGE. Technically, the originating broker's role is finished and the funding lender is responsible for submitting the final Close of Escrow Package. However, it is advisable for the broker to discuss with the funding lender their role in submitting the closing package, a failure to meet the Commitment expiration deadline can result in additional work and costs to both the broker and funding lender. D. PROPERTY CODE INSPECTION REQUIREMENT The Lender must request that a Housing Inspector conduct a property inspection to ensure the subject property meet State and local housing quality standards and code requirements. The City will notify the Lender, Buyer, and Escrow of work needed to cure defects, if any, within seven (7) business days of such inspection. Please refer to Appendix D. All properties built prior to 1978 must meet HUD regulations for notification, inspection, reduction/abatement and clearance of lead -based paint hazards under Title X of the Housing and Community Development Act of 1992. If the City Housing Inspector and/or City Certified Risk Assessor (or equivalent per HUD protocol) determines that Lead -Based Paint Hazards are present on the subject property, the City shall notify Buyer, Lender and Escrow within three (3) business days of such determination. A City Certified Risk Assessor will be scheduled a Lead - Based Paint Risk Assessment of the property. The Risk Assessor will provide all parties with a copy of any and all Risk Assessment Report(s) within seven (7) business days of the completing the assessment. Reduction or abatement of all identified Lead -Based Paint Hazards will be required and must be corrected and cleared by the City prior to close of escrow and prior to wire transfer of the City's funds. E. LOAN PROCESSING 1. CHWR & L accepts and reviews the Application package and makes a determination as to completeness and accuracy. After the Application has been approved, the CHWR & Lwill issue a Commitment to the Lender. The Commitment designates a reservation number for the Application and is valid for 90 calendar days. 2. The City will maintain a cumulative total of loan amounts reserved. When program funds are about to be depleted, the CHWR & L will notify all participating Lenders. 3. Lender will complete the remainder of the standard mortgage application process 4. Package Turn -Around: City staff date -stamp packages and review in order of receipt. Turn around time for reviewing and sending a loan commitment or denial letter to the Lender is six (6) business days from the receipt of a complete package. 5. RUSH: Packages marked "RUSH" or "SUPER RUSH" etc. will not be processed ahead of other pending packages. 6. Incomplete Packages: Incomplete packages may delay the approval and subsequent issuance of the City Commitment Approval Letter. 13 Exhibit B: National City FTHB Assistance Program Manual F. LOAN CLOSING 1. CHWR & L partially completes the Closing Affidavit. 2. Lender and City forward loan documents to selected escrow officer with instruction for closing the loans. The buyer signs the City loan documents. The escrow officer forwards the copies of the executed Loan Documents back to the CHWR & L. 3. Before the expiration of the 90-day commitment and prior to recordation, the Lender and Escrow send the Close of Escrow documents to CHWR & L. These documents include: a. Signed copy of City Deed of Trust and Homeowner's Regulatory Agreement for the HOME program participation (Escrow sends original Deed of Trust and Agreement to County Recorder's Office), original Promissory Note, forgivable Note (if applicable), Truth in Lending Statement, Escrow Instructions and all amendments and copy of estimated HUD 1 Statement. b. Closing Affidavit signed by the Applicant(s) at the time of the loan closing. c. All outstanding loan conditions listed on the Commitment letter and/or Instructions to Escrow. d. City reviews Closing Package and checks the file to ensure all necessary documents have been submitted. 4. City loan documents are only good during the month that they are drawn and any delays may require the preparation of all City final loan documents with a corrected date. There will be no funding into the month. 5. CHWR & L will transfer funds by wire as instructed on the Funding Request and Escrow Information Sheet located in the forms section of this Manual. Any secondary wires that are issued due to errors on behalf of the Lender, Escrow or Title Company will require an additional $35.00 re -wire fee and shall be paid by the party at fault. Lenders must adhere to the time frame for the City and the CHWR & L processing period, promptly notifying the CHWR & L in writing of any loan cancellations and/or request for reservation or commitment extensions. If the Lender assigns responsibility of execution of City loan forms to Escrow or Title Office personnel, the Lender assumes full responsibility for training the personnel to comply with the requirements of this Manual. 14 Exhibit B: National City FTHB Assistance Program Manual G. CANCELLATION AND COMMITMENT EXPIRATIONS 1. Cancellations: When a decision is made not to continue with the City application, written notice must be received at the Offices of CHWR & L prior to the expiration of the Commitment. The notice must include the reason for the cancellation and the signatures of both the Lender and the Applicant. 2. Expiration of Commitment: Before the Commitment has expired, the Lender must either: a. Submit the closing package b. Submit written notice of loan cancellation c. Request a 30 day extension in writing Upon expiration of the Commitment, the Lender must do one of the following: a. If the loan has not closed, the Lender must submit a request for extension and provide estimate of closing date to CHWR & L b. If 120 days has passed since the Commitment was issued and no extension was requested, the Lender must submit an entirely new Loan Application with current income verification with a letter of explanation for the delay c. If the loan was canceled, the Lender submits a cancellation notice as described above In all cases, expiration of the Commitment without the required action by the Lender will result in the Lender being placed on "Inactive Status", and the Lender may submit no new City applications until the issue has been resolved. Failure to comply may result in the Lender's removal from the Certified Lender Partner List and program. SECTION III CHANGES PRIOR TO CLOSING CHWR & L issues a loan Commitment based on the Applicant's and Seller's Affidavits and the Lender's certification that the City's Program requirements have been met. The Lender must immediately notify the CHWR & Lin writing of any change that could affect the Applicant(s) eligibility for the loan. If a change in the circumstances of the Applicant is such that he/she no longer meets program requirements, the Commitment is automatically revoked. 1. Income: The eligibility of the Applicant for a City loan is based on the Applicant's anticipated taxable income. The CHWR & L will issue the Commitment based on the household income as of the date the Commitment is issued. The income verified for the Commitment is valid as long as the loan closes within four months after the financial information was originally submitted and there have been no changes which effect previously reported income. If the loan does not close within three months, all applicable City documentation must be re -submitted and income must be re -verified. 2. Marital Status: If the Applicant gets married after issuance of the Commitment and prior to closing, the spouse must satisfy the prior homeownership requirements contained in the First -Time Homebuyer Application and Affidavit and the Closing Affidavit. The Lender must also notify the CHWR & L program administrator. Any increase in the household income because of the new spouse must be considered and may affect re -issuance of a new Commitment. 3. Acquisition Cost: If a change in acquisition cost occurs after the Commitment and prior to closing, the Lender will be required to originate and submit a new version of: a. First -Time Homebuyer Loan Application and Affidavit b. Amended Escrow Instructions c. Seller Affidavit d. All other documentation that may be applicable as listed previously in this Manual 4. Loan Amount: Any changes to the loan amount which occur after the Commitment has been issued and prior to closing must be reported to the City immediately by phone, 15 Exhibit B: National City FTHB Assistance Program Manual followed up with a written confirmation along with all applicable documentation listed in this Program Manual. Upon receipt of revised/updated documentation, a revised Commitment may be issued. 16 Exhibit B: National City FTHB Assistance Program Manual APPENDIX A INCOME GROSS ANNUAL INCOME Gross annual income is defined as the anticipated annualized gross taxable income of a mortgagor (or mortgagors) and adult members of the household. Annualized income is the sum of monthly gross taxable income multiplied by twelve (12). Gross monthly income includes all taxable sources of income derived from: gross pay, overtime compensation, part- time employment earning, bonuses, dividends, interest, royalties, pensions, Veterans Administration (VA) compensation, net rental income, alimony, public assistance payments, sick pay, social security benefits, unemployment compensation, income received from trusts, income received from business activities or investments, and any other source of taxable income not listed above. Information regarding income must be current within the most recent 30-day period preceding loan closing. Income not included by the Lender, but listed above, must be added to the Lender's income total on the "Income Computation Worksheet" income eligibility calculation for the City loan program. Income of the mortgagor (or mortgagors) and any other adult who is expected to live in the residence being financed must also be included in the household income calculation. All non-taxable income must be listed and bracketed on the "Income Computation Worksheet", but not counted when calculating the annual gross family income. In summary, income of all mortgagors (on both title and deed of trust) shall be included in the gross income calculation for the program. Additionally, the income of any adult who will live in the residence should be included. For married couples, income includes the income of both spouses, whether or not on title. MILITARY PAY For purposes of computing the buyer's gross monthly income, the monthly income is the "total entitlement" shown on the applicant's most recent monthly Leave and Earnings Statement and includes all regular pay, special pay and allowances. Non -taxed income, such as a housing allowance is not counted as income, but must be listed and bracketed. Certain categories of pay, which may be received only sporadically, may need to be considered on a case -by -case basis. 17 Exhibit B: National City FTHB Assistance Program Manual APPENDIX B SEQUENCE OF LOAN PROCESS 1. HOMEBUYER • With Lender, determines loan eligibility. • Selects house that is vacant or owner -occupied. • Makes Purchase Offer, which is accepted pending financing. • Applies to Participating Lender for financing. • Lender gives homebuyer a City Loan Information Package. • Completes Homebuyer Education course. 2. LENDER • Starts processing for mortgage loan and City loan. • Verifies eligibility for City loan. Prepares and forwards application package to City. • Processes, underwrites and approves Applicant for first mortgage. • Requests that City inspect property for health and safety defects. 3. CHWR & L STAFF AND CERTIFIED LEAD BASED PAINT PROFESSIONALS: • Inspects selected property for health and safety defects, lead -based paint hazards and notifies lender, buyer and Escrow of work needed to cure defects. • CHWR & L notifies Buyer, Lender and Escrow within 15 days of lead -based hazard determination (if applicable), and provides Buyer, Lender, and Escrow a copy of any/all Risk Assessment Report(s). • CHWR & L issues Commitment to Lender after approving application package and verifying that the property meets minimum property standards. (NOTE: The City may choose to issue a Commitment pending receipt of missing documentation and completion of work to cure property of code violations and/or lead -based paint hazards.) • Work to cure property defects and/or lead -based paint hazards takes place by Certified Lead -Based Paint Professionals (if applicable). • Re -inspection and clearance of property takes place to ensure Housing Quality Standards and elimination of lead -based paint hazards. 4. ESCROW, LENDER & CHWR & L • Coordinates signing of all closing documents by Sellers and Borrowers. 5. LENDER • Sends Close of Escrow Package and all outstanding documentation (per the Commitment) to CHWR & L prior to Commitment expiration. • Funds loan through Escrow/Title and Escrow/Title Company and sends Deed of Trust and all recordable documents to the Title Company or County Recorder's Office (close of escrow). 6. CHWR & L Receives and reviews Close of Escrow Package (outstanding documentation, original documents, and certified/executed copies). • Wires City loan funds through Escrow/Title and Escrow/Title Company sends Deed of Trust and all recordable documents to the Title Company or County Recorder's Office (close to escrow). • Conducts random audit of Lenders records. 7. HOMEBUYER • Receives City loan. • Signs an Annual Affidavit of Owner -Occupancy. 18 Exhibit B: National City FTHB Assistance Program Manual APPENDIX C CITY LOAN QUALITY COMMITMENT POLICY The City of National City Community Development Department and the CHWR & L invites the entire mortgage lending community to participate in the First -Time Homebuyer Program. Participation will continue to be open to those mortgage lenders who uphold the following work standards: • Lending company personnel receive training for the program before being assigned to prepare loan packages. This training includes: CHWR & L training sessions (if applicable); knowledge of training manual; knowledge of City -provided update letters. • Each lender enrolled in the program designates a CHWR & L Contact Person for each participating branch. The Contact's responsibilities include: 1) making Lender Update letters (including attachments) available to all City loan -related personnel in a timely manner; 2) attending at least one training session per year (if applicable); 3) notifying Housing staff of any re -assignment of Contact person and/or changes in company location and or status. • Expiration of a CHWR & L Loan Commitment without submission of the required paperwork must be addressed in a timely manner by; submitting the documents necessary to make the file current, close the loan, or canceling the pending loan with notification to the City. • The lender must obtain the CHWR & L's Commitment to issue the loan before funding the loan. • Each participating lender ensures that the closing or funding department of their company is aware of their obligations under the city loan program and is prepared to submit all necessary closing documentation in a timely manner. • Buyers are treated fairly, receiving a full and accurate explanation about the city loan. For questions that the lender cannot answer, the buyer is referred to housing staff. 19 Exhibit B: National City FTHB Assistance Program Manual APPENDIX D NATIONAL CITY CODE INSPECTION REQUIREMENT For purposes of the program, the City must use the HOME Investment Partnership (HOME) Program Requirements. HOME Program regulation 24 CFR 92.251(a)(2) states that housing must "meet all applicable State and local housing quality standards and code requirements and, if there are no such standards or code requirements, the housing must meet the housing quality standards in 24 CFR 982.401." The Acceptability Criteria listed with each section below sets the minimum standards that must be met in all residential units. The Interpretation of Acceptability Criteria listed after those criteria are the standards that HUD feels should also be met if the property is to have long-term utility and contribute to the livability of the unit. ACCEPTABLE CRITERIA AND INTERPRETATIONS A. SITE AND NEIGHBORHOOD - The site and neighborhood shall be reasonably free from disturbing noises and reverberations and other hazards to the health, safety and general welfare of the occupants. ACCEPTABILITY CRITERIA - The site and neighborhood shall not be subject to serious adverse environmental conditions, natural or manmade such as: 1. Dangerous walks, steps or instability; 2. Flooding, poor drainage, septic tank back-ups, sewer hazards or mudslides; 3. Abnormal air pollution, smoke or dust; 4. Excessive noise, vibrations or vehicular traffic; 5. Excessive accumulations of trash; 6. Vermin or rodent infestation; 7. Fire hazards; Generally, approval of an area under a CDBG, Section 8, HOME and/or HOPE III will be sufficient to meet these criteria. INTERPRETATION OF ACCEPTABILITY CRITERIA 1. All steps and walks should be level, free from dangerous cracks, crumbling or breaks, tripping hazards, broken & missing materials, etc., and be provided with sufficient pitch to prevent water accumulation. 2. The lot should have positive drainage away from the dwelling and/or dwelling unit to prevent standing water at the foundation. 3. No additions. 4. No additions. 5. Any materials, which accumulate on a property in the neighborhood, should be removed or screened and arranged in a manner that does not detract from the general appearance of the neighborhood. 6. No additions - see #5 above - removal of trash, garbage, debris, etc., will significantly reduce infestation problems. 7. The site should be free from fire hazards, such as the storage of highly flammable materials, etc. 20 Exhibit B: National City FTHB Assistance Program Manual B. ACCESS - The dwelling/dwelling unit shall have adequate access for the occupants. ACCEPTABILITY CRITERIA - 1. The dwelling/dwelling unit shall be usable and capable of being maintained without unauthorized use of other private properties. 2. The building shall provide an alternative means of egress in case of fire, i.e., fire stairs, egress through windows, etc. INTERPRETATION OF ACCEPTABILITY CRITERIA 1. The property should be adjacent to an access street or road. 2. No additions. C. STRUCTURE AND MATERIALS - The dwelling/dwelling unit shall be structurally so as not to pose any threat to the health and safety of the occupants and so as to protect the occupants from the environment. ACCEPTABILITY CRITERIA 1. Ceilings, walls (interior and exterior), floors, roofs, porches, etc., shall not have any serious defects such as severe bulging or leaning, large holes, loose surface materials, severe buckling or noticeable movement under walking stress, missing parts, or other serious damage. 2. The roof structure shall be firm and the roof shall be weather tight. 3. The exterior wall structure and the exterior and interior wall surfaces shall not have any serious defects such as serious leaning, buckling, sagging, cracks or holes, loose materials, loose siding or other serious damage. 4. The conditions and equipment of interior and exterior stairways, halls, porches, walkways, etc., shall be such as not to present a danger of tripping and/or falling. 5. Elevators shall be maintained in a safe operating condition. 6. In the case of a mobile home, the home shall be securely anchored by a tie -down device, which distributes and transfers loads imposed by the unit to appropriate ground anchors so as to resist wind, overturning and sliding. INTERPRETATION OF ACCEPTABILITY CRITERIA 1. Where crawl spaces or basements exist, all first -floor structural wood members, including floor joists, plates, piers and pilings should be inspected for cracked, broken, rotten or otherwise damaged conditions. Damaged members should be repaired and/or replaced as required. The exterior/interior walls should be weather -tight in a manner that prevents heat loss in the winter (cooling loss in the summer) as much as possible. This includes the repainting and/or installations of siding to protect the exterior surface from the elements. The interior walls should be repaired/replaced as required to facilitate this criterion. 2. The roof structure should be firm in that all roof -framing members should be free from cracks and rot. The roof sheathing should be solid and free from sagging, buckling, heaving, etc. If the roof appears to be well worn, it should be replaced. If possible, the best replacement will include stripping all the way down to the sheathing and replacing. If costs dictate, a second layer of roofing can be installed over the first layer. If there are already two or more layers of roofing materials, the roof should be stripped down to the sheathing, and if necessary, replace the sheathing and then install the new roof covering. 3. Concrete block or brick foundations, piers and pilings, should be inspected for loose mortar joints. All empty or cracked mortar joints should be tuck -pointed in an acceptable manner to match, as closely as possible, the rest of the structure. The joints should be recessed. 21 Exhibit B: National City FTI-IB Assistance Program Manual The chimney should be inspected for loose mortar joints and proper height. All empty or cracked mortar joints should be tuck -pointed in an acceptable manner to match, as closely as possible, the rest of the chimney. The joints should be recessed. 4. All exterior steps, walkways and porches should be free of tripping hazards. Crumbling, cracked, broken, missing and/or uneven conditions should be repaired and/or replaced as necessary. The condition of all interior stairways should be such as not to present a danger of tripping or falling, see above. Handrails should be properly installed on all stairways. 5. No additions. 6. No additions. 7. The property should be inspected by a qualified extermination firm, and if necessary treated for vermin, rodents, termites and other wood -burrowing insects. 8. All outbuildings such as garages, storage sheds, etc., should be repaired to a usable condition or removed from the property. 9. The general appearance of the outside of the structure and the lot, after rehabilitation, should be such that it makes a significant contribution to the general appearance of the neighborhood. 10. Installation of gutters and down spouts is strongly recommended in order to divert water away from foundations. D. LEAD -BASED PAINT - The dwelling unit shall be in compliance with the HUD Lead -Based Paint regulations. ACCEPTABILITY CRITERIA 1. The dwelling/dwelling unit shall comply with HUD Lead -based Paint regulations at 24 CFR Part 35, issued pursuant to the Lead -Based Paint Poisoning Prevention Act, 42 USC 4801. 2. The owner shall provide a certification that the dwelling is in compliance with such HUD regulations. 3. If the property was constructed prior to 1978, any in -place tenant/family shall be furnished a notice and pamphlet as required by the Lead -Based Paint regulations. Such notice shall inform them of the procedures regarding the hazards of lead -based paint poisoning, the symptoms and treatment of lead poisoning and the precautions to be taken against lead poisoning. INTERPRETATION OF ACCEPTABILITY CRITERIA 1. Compliance with the Lead -Based Paint regulations requires the following actions: • Notification to all occupants that the property may contain lead -based paint, if constructed prior to 1978, and the hazards, symptoms and treatment of such poisoning, including information on testing for elevated blood levels (EBL) for children. • All contracts shall include language prohibiting the use of lead -based paint. • The inspection for and elimination of "immediate hazards", which are defined as chipping, peeling, flaking, cracking or other defects in previously painted surfaces. 2. No additions. 3. No additions E. WATER SUPPLY ACCEPTABILITY CRITERIA 1. The dwelling/dwelling unit shall be served by an approved public or private sanitary water supply. 22 Exhibit B: National City FTHB Assistance Program Manual INTERPRETATION OF ACCEPTABILITY CRITERIA 1. The dwelling unit should have a water heater of sufficient capacity to serve present and anticipated future residents. Further, they should not be allowed in bathrooms, bedrooms, sleeping rooms or closets. 2. Hot and cold water should be supplied to all kitchens, baths and laundry facilities. 3. All water lines should be protected from freezing. F. INTERIOR AIR QUALITY - The dwelling/dwelling unit should be free of pollutants in the air at levels that threaten the health of the occupants. ACCEPTABILITY CRITERIA 1. The dwelling/dwelling unit shall be free from dangerous levels of air pollution from carbon monoxide, sewer gas, fuel gas, dust and other harmful air pollutants. 2. Air circulation shall be adequate throughout the dwelling/dwelling unit. 3. Bathroom areas shall have at least one operable window or other adequate exhaust ventilation. INTERPRETATION OF ACCEPTABILITY CRITERIA 1. All gas or oil fired appliances should have proper venting to the outside of the dwelling/dwelling unit for combustion gases. 2. All windows designed to open should be capable of being easily opened, provided with the proper window hardware to make them operable, and provided with screens properly installed and maintained. 3. Kitchen areas should also have proper ventilation. G. ILLUMINATION AND ELECTRICITY - Each room shall have adequate natural or artificial illumination to permit normal indoor activities and to support the health and safety of the occupants. Sufficient electrical sources shall be provided to permit use of essential electrical appliances while assuring safety from fire. ACCEPTABILITY CRITERIA 1. Living and sleeping rooms shall include at least one window. 2. A ceiling or wall -type light fixture shall be present and working in the bathroom and kitchen areas. 3. At least two electric outlets, one of which may be an overhead light, shall be present and operable in the living area, kitchen and each bedroom area. INTERPRETATION OF ACCEPTABILITY CRITERIA 1. No additions not performed in a workman -like manner 1. A ceiling or wall fixture, operated by a wall switch should be present in the kitchen, bath and hallways. 2. All outlets installed as a result of the rehabilitation work should be of the grounded type. 3. Each unit should be provided with a least 100 amp service and a sufficient number of circuits to service present and anticipated future use of the: • There should be separate circuits for any air conditioners (including window type), furnaces, electric dryers, electric stoves, microwaves and any other special appliances. • There should be two separate 20-amp circuits (minimum) for the heavy workload area in the kitchen, and all kitchens should be wired to the National Electric Code (NEC), based on the size and layout of each individual kitchen. • With the exception of kitchens (see b. above), all other rooms should be assessed relative to their use of electricity and additional outlets and/or switches installed based on usage and safety factors. • Electrical outlets in the bathrooms and kitchens should have an overload switch. 4. Connection at the main service to the unit should be in an acceptable manner. 23 Exhibit B: National City FTHB Assistance Program Manual • Placement of the connection should be out of the reach of children, • Proper anchoring should be used. 6 All defective exposed "knob & tube" wiring should be removed. It is recommended that any additional exposed "knob & tube" also be removed and replaced in conduit to prevent splicing and/or unsafe usage. 7. All hazardous conditions such as broken switches/outlets, missing covers, bare wiring, fixtures not properly installed/anchored should be repaired/replaced in an acceptable manner. It is recommended that all "pendant" type fixtures be replaced with an appropriate ceiling/wall fixture. 8. Although though a room may meet acceptability criteria #3 above, if the inspection reveals the use of octopus plugs, adapters, extension/zip cords and/or other unsafe practices, additional outlets should be installed. H. THERMAL ENVIRONMENT - The dwelling/dwelling unit shall have and be capable of maintaining a thermal environment healthy for the human body. ACCEPTABILITY CRITERIA 1. The dwelling/dwelling unit shall contain safe heating and cooling facilities, which are in proper operating condition and can provide adequate heat and/or cooling to each room in the dwelling/dwelling unit appropriate for the climate to insure a healthy living environment. 2. Unvented room heaters that burn gas, oil or kerosene are unacceptable. INTERPRETATION OF ACCEPTABILITY CRITERIA 1. All parts of the venting system for central heating/cooling units should be in proper working condition. For example: • Vent pipes should be free of rust and be properly maintained. • Where vent pipes are connected to a masonry chimney, that chimney should be properly maintained so that all mortar joints are tightly sealed. 2. No additions. 3. The attic should be insulated to a rating of R-30 with acceptable insulation material. Where cellulose is used, it should be tested for fire protection. Cellulose bags should be labeled with acceptable ratings derived from flame -spread tests. 4. Weather stripping should be applied as needed around all doors and windows. 5. Storm windows and doors should be installed whenever possible. 6. Any inside walls that are on an exterior wall, if opened down to the studs during the course of the rehabilitation, should be fully insulated with an acceptable insulation material. 7. All joints in the building envelope should be caulked/sealed. All brittle or loose caulking should be replaced. 8. Supply and return heating/air-conditioning ducts should be insulated whenever they run through unheated areas/spaces. 9. It is strongly recommended that whenever space heaters and/or floor furnaces are used, they be replaced with a properly installed more efficient central heating/cooling system. I. SANITARY FACILITIES - The dwelling/dwelling unit shall include its own sanitary facilities, which are in proper operating condition, can be used in privacy, and are adequate or personal cleanliness and the disposal of human waste. ACCEPTABILITY CRITERIA 1. A flush toilet in a separate, private room; a fixed basin with hot and cold running water; and a bathtub and/or shower with hot and cold running water, shall be present in the dwelling/dwelling unit, and shall be fully operational. 2. These facilities shall utilize an approved public or private disposal system. 24 Exhibit B: National City FTHB Assistance Program Manual INTERPRETATION OF ACCEPTABILITY CRITERIA 1. The toilet, basin, and tub or shower should all be located in the same room, if at all possible. 2. Where a public sewage system is not used, documentation in the file should show where the appropriate health agency has approved the disposal system. J. SPACE AND SECURITY - The dwelling/dwelling unit shall afford the family adequate space and security. ACCEPTABILITY CRITERIA 1. A living room, kitchen area, and bathroom shall all be present. 2. The dwelling/dwelling unit shall contain at least one sleeping or living/sleeping room of appropriate size for each two persons. 1. Exterior doors and windows accessible from outside the unit shall be lockable. 2. Each dwelling/dwelling unit should have smoke detectors. Where bedrooms are located on more than one floor of a structure, smoke detectors should be installed on each floor. It is recommended that all smoke detectors be U.L. approved and be hard -wired. U.L. approved battery type or a combination electric/battery type may also be used. INTERPRETATION OF ACCEPTABILITY CRITERIA 1. No additions K. FOOD PREPARATION AND REFUSE DISPOSAL - The dwelling/dwelling unit shall contain suitable space and equipment to store, prepare and serve foods in a sanitary manner. There shall be adequate facilities and services for the sanitary disposal of food waste and refuse, including facilities for temporary storage where necessary. ACCEPTABLE CRITERIA 1. The unit shall contain the following equipment in operating condition: 1) cooking stove or range, 2) refrigerator or appropriate size for the unit supplied by either the owner or the tenant/family, and 3) kitchen sink with hot and cold running water. 2. The sink shall drain into an approved public or private system. 3. Adequate space for the storage, preparation and serving of food shall be provided. 4. There shall be adequate facilities and services for the sanitary disposal of food waste and refuse, including facilities for temporary storage where necessary (i.e. garbage cans). INTERPRETATION OF ACCEPTABILITY CRITERIA 1. No additions made without City permits and not performed in a workman -like manner. 2. Food storage space should be in the form of cabinets and/or pantry type storage. Food preparation space should be in the form of counters or other horizontal workspace. 3. No additions. L. SANITARY CONDITION - The unit and its equipment shall be in sanitary condition. ACCEPTABILITY CRITERIA 1. The unit and its equipment shall be free of vermin and rodent infestation. INTERPRETATION OF ACCEPTABILITY CRITERIA 1. No additions not made without City permits 25 Exhibit B: National City FTHB Assistance Program Manual APPENDIX E SHARED EQUITY EXAMPLE NOTE: The following example assumes an initial (a) Gross Sales Price of $150,000 (b), Net Sales Price of $135,000 ($150,000 minus 10% seller fees), (c) 1' mortgage balance of $100,000 and City 2nd of $25,000 (d), Total Equity of $10,000 (b-c), and a City loan of $25,000.00 at a 0% interest rate, with an APR of 0%. The table is for the purpose of illustration only. Actual sales price and net sales price will vary. The principal amount of the loan remains due. # Months After Date Of Agreement Gross Sales Price (a) Net Sales Price (b) (a-10% fee) Mortgage Balances ( c ) (1st $100k & 2nd $25K) Total Equity ( d ) ( b-c) Buyer's Equity Share Increases 5% Per year City of Chula Vista's Equity Decreases 5% per year 0-12 $150,000 $135,000 $125,000 $10,000 $5,000 (50%) $5,000 (50%) 13-24 $155,000 $139,500 $125,000 $14,500 $7,975 (55%) $6,525 (45%) 25-36 $155,000 $139,500 $125,000 $14,500 $8,700 (60%) $5,800 (40%) 37-48 $160,000 $140,000 $125,000 $15,000 $9,750 (65%) $5,250 (35%) 49-60 $160,000 $140,000 $125,000 $15,000 $10,500 (70%) $4,500 (300/0) 61-72 $165,000 $148,500 $125,000 $23,500 $17,625 (75%) $5,875 (250/) 73-84 $165,000 $148,500 $125,000 $23,500 $18,800 (80%) $4,700 (20%) 85-96 $170,000 $153,000 $125,000 $28,000 $23,800 (85%) $4,200 (250/0) 97-108 $170,000 $153,000 $125,000 $28,000 $25,200 (90%) $2,800 (100/) 109-120 $175,000 $157,500 $125,000 $32,500 $30,875 (95%) $1,625 (5%) Thereafter I $175,000 $157,500 $125,000 $32,500 $32,500 (100%) $0 (00%o) In this example, the finance charge could vary between $1,625 and $6,525. Your amount will differ, depending upon gross sales price, net sales price, the amount of equity, and the number of months after the date of agreement that the sales occurs. If the Property is sold in the first year of the term of the Note secured by this Deed of Trust, Borrower shall receive fifty percent (50%) of the Equity in the Property and the City shall receive fifty percent (50%) of the Equity. "Equity" is defined as the dollar amount that constitutes the difference between the sales price of the Property and the sum of the following amounts: 1. Principal on the First Note and the Deed Trust; and 2. Principal on this Second Note and Deed of Trust to the City of National City; and 3. All costs of sales, including cost of brokers' commissions, escrow fees, title costs and fees, recording cost, etc.; and 4. Current year taxes, including all real estate taxes calculated to the date of sale; and 5. Borrower's down payment not including the loan from the City to Borrower; and 6. All principal paid down on the First Note and Deed of Trust; and 7. Costs of any improvements to the Property provided such improvements were approved by the City prior to construction and provided that such improvements have been documented to the satisfaction of the City. The amount of the Borrower's share in the equity of the Property shall increase by five percent (5%) per year, measured on the anniversary date of this Deed of Trust. Correspondingly, the 26 Exhibit B: National City FTHB Assistance Program Manual City's share in the equity of the Property shall decrease by five percent (5%) per annum. For the sake of example, if the Property is sold more than (5) but less than six (6) years after the date of this Deed of Trust, the City would have a twenty-five percent (25%) share in the Equity and the Borrower would have a seventy five percent (75%) share in the Equity of the Property. In the event that no Equity exists at the time of transfer or sale, the HOME funds (item 1b above) will still be due and payable. In the event that a negative Equity situation exists, and the full amount of the HOME funds are not available to be recaptured, the amount of HOME funds required to be repaid to the City will be as set forth in 24 CFR 92.254(a)(ii)(A)(3). The formulas are as follows: HOME investment X Net proceeds = HOME amount to be recaptured HOME investment + homeowner investment Homeowner investment X Net proceeds = Amount to homeowner HOME investment + homeowner investment "HOME investment" is defined as funds received pursuant to the HOME Investment Partnership Program. "Homeowner investment" is defined as the amount of down payment and capital improvements made by the owner since purchase. 27 Exhibit C Insurance ACORD® CERTIFICATE OF LIABILITY INSURANCE DATE(MLVDD(YYYY) 02/24/10 PRODUCER 0726293 1-415-546-9300 Arthur J. Gallagher & Co. Insurance Brokers of California, Inc., License 60726293 One Market Plaza, Spear Tower Suite 200 San Francisco, CA 94105 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AMEND. EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. INSURERS AFFORDING COVERAGE NAIC # INSURED Community HoueingWorks 1820 So Escondido Blvd Suite 101 Escondido, CA 92025 INSURER A: PHILADELPHIA INS CO 23850 INSURERS: PHILADELPHIA IND INS CO 18058 INSURER C: TRAVELERS IND CO OP CT 25682 INSURER D. INSURER E: COVERAGES THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMEDABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT. TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TQ WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS DE SUCH POLICIES. AGGREGATE LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. INS834D01.1 LTR tlNSRdd TYPE OF INSURANCEDATF POLICYNNJBER POLICY EFFECTIVE IMMID0 YYY) POLICY EXPIRATION DATEIMMIDOTYYYYI LIMITS A X GENERAL LIABILITY X COLV.IERCIAL GENERAL LIABILITY L_J CLAIMS MADE X OCCUR PPK471295 09/22/09 09/22/10 EACH OCCURRENCE 5 1,000,000 DAMAE TO PRE_ SES EaENauo nc 5 300,000 MED EXP (Any cue mull 5 15,000 PERSONAL AADV INJURY 51,000,000 GENERAL AGGREGATE 5 2,000,000 GENL AGGREGATE LIMITAPPUES PER: POLICY I 1C X LOC PRODUCTS• COMPIOP AGG 52,000,000 B X AUTOMOBILE % X X LIABILITY ANY AUTO PNPE347019 09/22/09 09/22/10 COMBINED SINGLE LIMN (Ea accident) S 1,000,000 BODILY INJURY (Pm person) 5 BODILY INJURY (PMmedent) 5 PROPERTY DAMAGE {Per accident) 5 GARAGE LIABILITY ANY AUTO AUTO ONLY -EA ACCIDENT 5 OTHER THAN EA ACC 5 AUTO ONLY: AGG 5 A "'EXCESS'ULMBRELLALIABILITY X _ X I OCCUR _^ CLAIMS MADE DEDUCTIBLE RETENTION 510,000 P080250766 09/22/09 09/22/10 EACHOCCURRENCE 510,000,000 AGGREGATE 5 10, 000, 000 S 5 5 C WORKERS COMPENSATION AND EMPLOYERS' LIABILITY Y!NBIylA9T5 ANY PROPRIETORIPARTNEWEXECUTIVELi OFFICERJMEMBER EXCLUDED? (Mandatary In NH) 11 yea. deavide under SPECIAL PROVISIONS below 11156946Y80009 06/01/09 06/01/10 /01/10 I X I WC STATU- I DFR . E.I. EACH ACCIDENT 51, 000, 000 E.L. DISEASE. EA EMPLOYE 51, 000, 000 E.L. DISEASE - POLICY LIMIT 5 1, 000, 000 OTHER DESCRIPTION OF OPERATIONS! LOCATIONS VEHICLES I EXCLUSIONS ADDED BY ENDORSE! TENT I SPECIAL PROVISIONS The following are included as an Additional Insured per the attached General Liability £orm(a): PI-NP-003 { 09/03) a CG 20 26 07 04. As respects to Auto Liability; Included as Designated insured per the attached form CA 2D 48 02 99. The City of National City, Its Elected Officials, Agents and Employeea City Attorney's Office Work Compensation: Waiver of Subrogation included per attached WC 04 03 06 (01) Terrorism Included as repectE General Liability and Vmbrella CERTIFICATE HOLDER The City of National City, Its Elected Officials, Agents and Employees City Attorney'a Office 1243 National City Blvd. National City, CA 91950-4301 IISA 10 flax Notice Applies for Non -Payment of Prem SHOULDANYOFTHEABOVE DESCRIBEDPOLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, THE ISSUING INSURER WILL ENDEAVOR TO MAIL 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE LEFT. BUT FAILURE TO DO 50 SHALL IMPOSE NO OBLIGATION OR LIABILITY OF ANY KIND UPON THE INSURER. ITS AGENTS OR REPRESENTATIVES. AUTHORIZED REPRESENTATIVE ACORD 25 (2009/01) raquelr 14535352 The ACORD name and logo are registered marks of ACORD ©1988-2009 ACORD CORPORATION. All rights reserved. IMPORTANT If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must be endorsed. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). DISCLAIMER This Certificate of Insurance does not constitute a contract between the issuing insurer(s), authorized representative ar producer, and the certificate holder, nor does it affirmatively or negatively amend, extend or alter the coverage afforded by the policies listed thereon. ACORD 25 (2009/01) PI-NP-003 (9f03) THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. GENERAL LIABILITY DELUXE ENDORSEMENT it is understood and agreed that the following extensions only apply in the event that no other specific coverage for the Indicated loss exposures are provided under this policy. If such specific coverage applies, the terms, conditions and limits of that coverage are the sole and exclusive coverage applicable under this policy. Throughout this endorsement the words "you' and "your refer to the Named Insured shown in the Declarations. The words "we", "us" and "our" refer to the Company providing this Insurance, This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE The following is a summary of the Limits of Insurance and additional coverage provided by this endorsement. For complete details on specific coverages, consult the policy contract wording. A. Medical Payments - Limit increased to $15,000; B. Supplementary Payments - Ball bonds increased to $2,500/Loss of eamings increased to $500 each day; C. Tenant's Legal Liability - for Fire, Lightning, Explosion, Smoke and Leaks from Sprinklers - Limit increased to $300,000; D. Broadened Definition of Who is An insured; E. Amended Duties In The Event Of Occurrence, Claim Or Suit; F. Broadened definition of Advertising Injury- includes Televised Or Videotaped Publication; G. Amended definition of Bodily injury to Include Mental Anguish; H. Broadened definition of Personal injury - includes Abuse of Process/discrimination; I. Amended Unintentional Failure To Disclose Hazards; J. Amended Liberalization Clause K. Added Employee Indemnification Defense Coverage — We will pay up to $25,000 in defense costs for an employee"in a criminal proceeding (subject to established criteria) ; L. "Property Damage"- Removed exclusion for "Property damage" resulting from the use of reasonable force to protect persons or property; M. Added blanket Additional Insured - Funding Source; N. Added blanket Additional insured - Managers or Lessors of Premises; O. Non -owned Watercraft - coverage length is increased to 56 ft.; Page 1 of 5 Includes copyright material of the Insurance Services Office. Inc. used with its permission. Pt-NP-003 (9/03) A. Medical Payments If Medical Payments Coverage (Coverage C.) is not otherwise excluded from this Coverage Part: 1. The Medical Expense Limit is changed subject to all the terms of Limits Of Insurance (Section 111) to the greater of: a. $15,000; or b. The Medical Expense Limit shown in the Declarations of this Coverage Part. 2. The requirement in the Insuring Agreement of Coverage C., that expenses must be Incurred and reported to us within "one year" of the accident date is changed to " three years." 3. Exclusion a. of Coverage C. at your option, does not apply to your volunteer workers or any person or organization under your direct supervision and control. B. Supplementary Payments In the Supplementary Payments - Coverages A. and B. provision: 1. The limit for the cost of bail bonds is changed from $250 to $2,500; and 2. The limit for loss of earnings is changed from $250 a day to $500 a day. C. Fire, Lightning, Explosion, Smoke and Leaks from Sprinklers if damage by fire to premises rented to you is not otherwise excluded from this Coverage Part, the word " fire" Is changed to "fire, lightning, explosion, smoke, or leakage from automatic fire protective systems" where it appears In: 1. The Limits Of Insurance section of the Declarations as the Fire Damage Limit. That limit: a. Is changed subject to ail the terms of Limit Of insurance (Section IIi) to the greater of: (1.) $300,000; or (2.) The amount shown in the declarations as the Fire Damage Limit. b. Subject to a. above is the most we will pay to all damage proximately caused by the same event, whether such damage results from fire, lightning, explosion, smoke, or leaks from automatic fire protective systems or any combination thereof. 2. The last paragraph of Coverage A. (Section I) after the Exclusions; 3. Paragraph 6. of Limits of insurance (Section 111); 4. Paragraph b.(1)(b) of the Other Insurance Condition (Section IV); and 5. Paragraph a. of the definition of insured contract" D. Who is An Insured Who is An insured (Section II) is changed as follows: 1. If coverage for newly acquired or formed organizations is not otherwise excluded from this Coverage Part. paragraph 4.a is changed to read: a. Coverage under this provision is afforded until the end of the policy period. 2. Each of the following is also an insured: a. At the first Named Insured's option, your volunteer workers; and b. Your medical directors and administrators, but only while acting within the scope of and during the course of their duties as such. Such duties do not include the fumishing or failure to furnish professional services of any physician or psychiatrist in the treatment of a patient. c. At the first Named Insured's option, any person or organization under your direct supervision and control while providing for you private home respite or foster home care for the developmentally disabled. However, the insurance afforded by b. above is excess over any other insurance covering any person or organization under your direct control or supervision. d. If you are an organization other than a partnership or joint venture, your managers and supervisors are also insureds, but only with respect to their duties as your managers and supervisors. e. Any organization and subsidiary thereof which you control and actively manage on the effective date of this Coverage Part However, the insurance afforded by e. above, for any organization and subsidiary thereof not named in the Declarations as a Named Insured, does not apply to injury or damage with respect to which an insured under this Coverage Part is also an insured under another policy, or would be an insured under such policy but for its termination or the exhaustion of Its Limits of Insurance. Page 2 of 5 includes copyright material of the Insurance Services Office, Inc. used with its permission. PI-NP-003 (9/03) E. Duties in The Event Of Occurrence, Claim Or Suit 1. The requirement In condition 2.a. (Conditions, Section IV) that you must see to it that we are notified as soon as practicable of an occurrence or an offense, applies only when the "occurrence' or offense Is known to: (a) You, if you.are an individual; (b) A partner, if you are a partnership; or (c) An executive officer or Insurance manager, if you are a corporation. 2. The requirement in condition 2.b. that you must see to it that we receive notice of a claim or "suit" as soon as practicable will not be considered breached unless the breach occurs after such claim or "suit" Is known to: (a) You, if you are an individual; (b) A partner, if you are a partnership: or (c) An executive officer or insurance manager, if you are a corporation. F. Advertising Injury - Televised Or Videotaped Publication 1. The definition of "Personal and advertising injury" items 14. (d),(e),(f) and (g) Is changed to read: "Personal and Advertising injury" means Injury arising out of one or more of the following offenses: d. Oral, written, televised or videotaped publication of material that slanders or libels a person or organization or disparages a person's or organization's goods, products or services; e. Oral, written, televised or videotaped publication of material that violates a person's right of privacy; f. Missappropriation of advertising Ideas or style of doing business; or g. Infringement of copyright, title or slogan. 2. Exclusions a.(2) and a.(3) of Coverage B., Personal And Advertising Injury Liability, are changed to read: a. (2) Arising out of oral, written, televised or videotaped publication of material, if done by or at the direction of the insured with knowledge of its falsity; a. (3) Arising out of oral, written. televised or videotaped publication of material whose first publication took place before the beginning of the policy period. G. Bodily Injury - Mental Anguish The definition of "bodily injury" is changed to read: "Bodily Injury": a. Means bodily Injury, sickness or disease sustained by a person, and Includes mental anguish resulting from any of these; and b. Except for mental anguish, includes death resulting from the foregoing (item a. above) at any time. H. Personal Injury - Abuse Of Process/Discrimination if Personal and Advertising Injury Liability Coverage (Coverage B.) is not otherwise excluded from this Coverage Part: 1. The defir'dtion of "Personal and advertising injury" Is changed by: a. Revising item b. of that definition to read: Malicious prosecution or abuse of process: b. Adding the following: "Personal Injury" also means discrimination based on race, color, religion, sex, age or national origin, except when: (1) Done intentionally by or at the direction of, or with the knowledge or consent of: (a) Any Insured; or (b) Any executive officer, director, stockholder, partner or member of the insured; or (2) Directly or indirectly related to the employment, former or prospective employment, termination of employment, or application for employment of any person or persons by an insured: or Page 3 of 5 Includes copyright material of the Insurance Services Office, Inc. used with its permission. PI-NP-003 (9/03) (3) Directly or indirectly related to the sale, rental, lease or sub -lease or prospective sales, rental, lease or sub -lease of any room, dwelling or premises by or at the direction of any insured; or (4) Insurance for such discrimination is prohibited by or held In violation of law, public policy, legislation, court decision or administrative ruling. The insurance afforded by H.1 .b. above does not apply to fines or penalties Imposed because of discrimination. I. Unintentional Failure To Disclose Hazards It is agreed that, based on our reliance on your representations as to existing hazards, if you should unintentionally. fail to disclose all such hazards prior to the beginning of the policy period of this Coverage Part, we shall not deny coverage under this Coverage Part because of such failure. J. Liberalization If we revise this endorsement to provide more coverage without additional premium charge, we will automatically provide the additional coverage to all endorsement holders as of the day the revision is effective in your state. K. Employee Indemnification Defense Coverage Under SUPPLEMENTARY PAYMENTS — COVERAGES A AND B the following Is added: 3. We will pay on your behalf defense costs incurred by an "employee" in a criminal proceeding. However, you must have a prior written agreement with such "employee" whereby you agree to indemnify the "employee" for such defense costs and the agreement includes a provision for repayment of defense costs in the event of an adverse judgement. The most we will pay for any "employee" who is alleged to be directly involved in a criminal proceeding is $25,000 regardless of the number of employees, claims or "suits" brought or persons or organizations making claims or bringing "suits." L. Extended "Property Damage" SECTION 1— COVERAGES, COVERAGE A, 2. Exclusions a. Is deleted and replaced by the following: a. Expected or Intended Injury "Bodily Injury" or'Property Damage" expected or intended from the standpoint of the insured. This exclusion does not apply to "bodily Injury" or "property damage" resulting from the use of reasonable force to protect persons or property. M. Additional Insured- Funding Source ^' Under SECTION it - WHO IS AN INSURED the following is addded: 5. Any person or organization with respect to their liability arising out of: a. Their financial control of you; or b. Premises they own, maintain or control while you lease or occupy these premises. This insurance does not apply to structural alterations, new construction and demolition operations performed by or for that person or organization. N. Additional Insured -Managers or Lessors of Premises '! Under SECTION II " WHO IS AN INSURED the following is added: 6. Any person or organization with respect to their liability arising out of the ownership, maintenance or use of that part of the premises leased to you subject to the following additional exclusions: This Insurance does not apply to: a. Any "occurrence" which takes place after you cease to be a tenant in that premises. b. Structural alterations, new construction or demolition operations performed by or on behalf of that person or organization. O. Non -owned Watercraft SECTION I — COVERAGES, 2.Exclusions, paragraph g. (2) is amended to read as follows: (2) A watercraft you do not own that Is: Page 4 of 5 Includes copyright material of the Insurance Services Office, Inc. used with its permission. PI-NP-003 (9/03) (a) Less than 58 feet long; and (b) Not being used to carry persons or property for a charge; This provision applies to any parson, who with your consent, either uses or Is responsible for the use of a watercraft. This insurance Is excess over any other valid and collectible insurance available to the Insured whether primary, excess or contingent Page 5of5 Includes copyright material of the Insurance Services Office, inc. used with its permission. POLICY NUMBER: PP&471295 COMMERCIAL GENERAL LIABILITY CG 20 26 07 04 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. ADDITIONAL INSURED - DESIGNATED PERSON OR ORGANIZATION This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART SCHEDULE Name Of Additional Insured Person(s) Or Organization(s) The City of National City, Its Elected Officials, Agents and Employees City Attorney's Office 1243 National City Blvd. National City, CA 91950-4301 OSA Information required to complete this Schedule, if not shown above, will be shown in the Declarations. Section II — Who Is An Insured is amended to in- clude as an additional insured the person(s) or or- ganization(s) shown in the Schedule, but only with respect to liability for "bodily injury", "property dam- age" or "personal and advertising injury" caused. in whole or in part, by your acts or omissions or the acts or omissions of those acting on your behalf: A. In the performance of your ongoing operations; or B. In connection with your premises owned by or rented to you. CG 20 26 07 04 © ISO Properties, Inc., 2004 Page 1 of 1 0 POLICY #: M0E347019 COMMERCIAL AUTO CA 20 48 02 99 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. DESIGNATED INSURED This endorsement modifies insurance provided under the following: BUSINESS AUTO COVERAGE FORM GARAGE COVERAGE FORM MOTOR CARRIER COVERAGE FORM TRUCKERS COVERAGE FORM With respect to coverage provided by this endorsement, the provisions of the Coverage Form apply unless modi- fied by this endorsement. This endorsement identifies person(s) or organization(s) who are "insureds" under the Who Is An Insured Provi- sion of the Coverage Form. This endorsement does not alter coverage provided in the Coverage Form. This endorsement changes the policy effective on the inception date of the policy unless another date is indicated below. Endorsement Effective: 09/22/09 Countersigned By: (Authorized Representative) Named Insured:�� Community HousingWorks SCHEDULE Name of Person(s) or Organization(s): The City of National City, Its Elected Officials, Agents and Employees City Attorney's Office 1243 National City Blvd. National City, CA 91950-4301 USA (If no entry appears above, information required to complete this endorsement will be shown in the Declarations as applicable to the endorsement.) Each person or organization shown in the Schedule is an "insured" for Liability Coverage, but only to the extent that person or organization qualifies as an "insured" under the Who Is An Insured Provision contained in Section II of the Coverage Form. CA 20 48 02 99 Copyright, Insurance Services Office, Inc., 1998 TRAVELERS J WORKERS COMPENSATION AND EMPLOYERS LIABILITY POLICY ENDORSEMENT WC 04 03 06 (01) — 002 POLICY NUMBER: (XEUB-6946Y80-8-09) WAIVER OF OUR RIGHT TO RECOVER FROM OTHERS ENDORSEMENT-CALIFORNIA We have the right to recover our payments from anyone liable for an injury covered by this policy. We will not enforce our right against the person or organization named in the Schedule. (This agreement applies only to the extent that you perform work under a written contract that requires you to obtain this agreement from us.) You must maintain payroll records accurately segregating the remuneration of your employees while engaged in the work described in the Schedule. THE ADDITIONAL PREMIUM FOR THIS ENDORSEMENT SHALL BE .200 % OF THE CALIFORNIA WORKERS' COMPENSATION PREMIUM OTHERWISE DUE ON SUCH REMUNERATION. SCHEDULE PERSON OR ORGANIZATION JOB DESCRIPTION THE CITY OF NATIONAL CITY, ITS ELECTED OFFICIALS, AGENTS AND EMPLOYEES CITY ATTORNEYS' OFFICE 1243 NATIONAL CITY BLVD NATIONAL CITY,CA 91950-4301 DATE OF ISSUE: 02-22-10 ST ASSIGN: SUPPLEMENT TO CERTIFICATE OF INSURANCE DATE 02/24/1D NAME OF INSURED: Community gouaingworks Additional Description of Operations(Remarks from Page 1: Additional Information: SUPP (05/04) ACORO� CERTIFICATE OF LIABILITY INSURANCE DATE (MM/DDAWY) 02/24/10 PRODUCER 0726293 1-415-546-9300 Arthur J. Gallagher & Co. Insurance Brokers of California, Inc., License #0726293 One Market Plaza, Spear Tower Suite 200 San Francisco, CA 94105 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. INSURERS AFFORDING COVERAGE NAIC # INSURED Community HousingWorks Realty & Lending 1820 So Escondido Blvd Suite 101 Escondido, CA 92025 INSURER A: UNDERWRITERS AT LLOYDS LONDON 15792 INSURER e: INSURER C: INSURER 0: INSURER E: COVERAGES THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. AGGREGATE LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. INSR LTR ADD'. NSRQ TYPE OF INSURANCE POLICY NUMBER POLICY EFFECTIVE DATE (MM/OD/YVYYI POLICY EXPIRATION DATE (MM/DD/YVYY) LIMITS GENERAL LIABILITY COMMERCIAL GENERAL LIABILITY EACH OCCURRENCE $ DAMAGE TO RENTED PREMISES Ea occurrence) $ CLAIMS MADE OCCUR MED EXP (Any one person) $ PERSONAL & ADV INJURY $ $ GENERAL AGGREGATE GEN'L AGGRErGATE LIMIT APPLIES PER: POLICY ) PEO CT I . LOC PRODUCTS - COMP/OP AGG $ AUTOMOBILE LIABILITY ANY AUTO A BODILY INJURY (Per person) $ BODILY INJURY (Per accident) $ PROPERTY DAMAGE (Per accident) $ GARAGELIABILITY A ANY AUTO AUTO ONLY - EA ACCIDENT $ OTHER THAN EA ACC $ AUTO ONLY: AGG $ EXCESS /UMBRELLA LIABILITY OCCUR CLAIMS MADE DEDUCTIBLE RETENTION $ EACH OCCURRENCE $ AGGREGATE $ $ $ $ WORKERS COMPENSATION AND EMPLOYERS' LIABILITY Y / N ANY PROPRIETOR/PARTNER/EXECUTIVE I OF OFFICER/MEMBER EXCLUDED? (Mandatory in NH) It yes, describe under SPECIAL PROVISIONS below WC STATU- OTH- TORY LIMITS ER E.L. EACH ACCIDENT $ E.L. DISEASE - EA EMPLOYEE $ E.L. DISEASE -POLICY LIMIT $ A OTHER Errors & Omissions MB60569 12/30/09 12/30/10 Limit 1,000,000 Aggregate Limit 1,000,000 See Below DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES 1 EXCLUSIONS ADDED BY ENDORSEMENT / SPECIAL PROVISIONS Policy Form: Claims Made $25,000 Each Wrongful Act or series of continuous, repeated or related Wrongful Acts Retroactive Date: December 30, 2006 Evidence of coverage only CERTIFICATE HOLDER CANCELLATION The City of National City, Its Elected officials, Agents and Employees City Attorney's Office 1243 National City Blvd. National City, CA 91950-4301 USA SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCEL LED BEFORE THE EXPIRATION DATE THEREOF, THE ISSUING INSURER WILL ENDEAVOR TO MAIL 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE LEFT, BUT FAILURE TO DO SO SHALL IMPOSE NO OBLIGATION OR LIABILITY OF ANY KIND UPON THE INSURER, ITS AGENTS OR REPRESENTATIVES. AUTHORIZED REPRESENTATIVE ACORD 25 (2009/01) raquelr © 1988-2009 ACORD CORPORATION. All rights reserved. 14535376 The ACORD name and logo are registered marks of ACORD IMPORTANT If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must be endorsed. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). DISCLAIMER This Certificate of Insurance does not constitute a contract between the issuing insurer(s), authorized representative or producer, and the certificate holder, nor does it affirmatively or negatively amend, extend or alter the coverage afforded by the policies listed thereon. ACORD 25 (2009/01) RESOLUTION NO. 2010 — 142 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY ADOPTING THE NATIONAL CITY FIRST-TIME HOMEBUYER ASSISTANCE PROGRAM MANUAL, AND AUTHORIZING THE MAYOR TO EXECUTE A SUBRECIPIENT AGREEMENT BETWEEN THE CITY OF NATIONAL CITY AND COMMUNITY HOUSINGWORKS REALTY & LENDING INCORPORATED TO ADMINISTER THE FIRST-TIME HOMEBUYER ASSISTANCE PROGRAM WHEREAS, the HOME Investment Partnerships Act, Title II of the Cranston - Gonzalez National Affordable Housing Act (42 U.S.C. 12701), as enacted and amended by the Congress of the United States, and promulgated by federal rules and regulations, hereinafter called the "HOME program", provides entitlement funds to states and local governments to expand the supply of affordable housing, and make housing more affordable to very -low and low-income families; and WHEREAS, the City Council has appropriated $358,090.00 in Fiscal Year 2010 and $296,989.00 in Fiscal Year 2011 to assist low-income First -Time Homebuyers at or under 80% of Area Median Income by providing assistance in the form of a silent second mortgage loan of 20% of the purchase price up to $40,000; and WHEREAS, the City has developed program guidelines that comply with HOME program regulations and provide the policies and procedures for the loan program; and WHEREAS, the HOME program allows units of general local government to enter into an agreement with a subrecipient to administer HOME program funds; and WHEREAS, the City solicited proposals for the administration of the City's First - Time Homebuyer Assistance Program through a Request for Proposal process; and WHEREAS, Community HousingWorks Realty & Lending, Inc., responded to the Request for Proposal and was selected as the proposed Program Administrator for their qualifications and experience in homebuyer education and counseling, down payment, and closing cost loan and grant assistance programs. NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of National City hereby adopts the National City First Time Homebuyer Assistant Program Manual. BE IT FURTHER RESOLVED that the City Council of the City of National City authorizes the Mayor to execute a Subrecipient Agreement between the City of National City and Community HousingWorks Realty & Lending, Inc., for the administration of the National City First Time Homebuyer Assistance Program. Said Subrecipient Agreement is on file in the office of the City Clerk PASSED and ADOPTED this 22nd day of Jun, 010. ATTEST: Lh4 Jerk on Morrison, Mayor APPROVED AS TO FORM: MikeDalla City George H . Eiser, III, City Attorney Passed and adopted by the Council of the City of National City, California, on June 22, 2010 by the following vote, to -wit: Ayes: Councilmembers Morrison, Sotelo-Solis, Van Deventer, Zarate. Nays: None. Absent: None. Abstain: None. AUTHENTICATED BY: RON MORRISON Mayor of the City of National City, California City C erk of the City of ational City, California By: Deputy I HEREBY CERTIFY that the above and foregoing is a full, true and correct copy of RESOLUTION NO. 2010-142 of the City of National City, California, passed and adopted by the Council of said City on June 22, 2010. City Clerk of the City of National City, California By: Deputy CITY OF NATIONAL CITY, CALIFORNIA COUNCIL AGENDA STATEMENT C ao\o - 3q MEETING DATE: June 22, 2010 AGENDA ITEM NO. 33 fEM TITLE: Resolution of the City Council of the City of National City adopting the National City First -Time Homebuyer Assistance Program Manual, and authorizing the Mayor to execute a Subrecipient Agreement between the City of National City and Community HousingWorks Realty and Lending Incorporated to administer the First -Time Homebuyer Assistance Program (Community Development Dep., Housing and Grants Division) PREPARED BY: Carlos Aguirre DEPARTMENT: Corr�munity Development PHONE: (619) 336-4391 APPROVED BY: EXPLANATION: On September 15, 2009 the Housing and Grants Department made a presentation to the City Council proposing a First -Time Homebuyer Assistance Program funded by the U.S. Department of HUD HOME Program. Staff was then directed by City Council to further develop the program and request proposals from organizations that had the capacity to originate, process, and provide servicing for the proposed loan program. Staff conducted an RFP process and selected Community HousingWorks Realty and Lending, Inc. as the program administrator and HOME Program Subrecipient for their qualifications and experience. The City has worked with Community HousingWorks to finalize the Program Manual for adoption and begin the program in July 2010. FINANCIAL STATEMENT: ACCOUNT NO. 505-409-462-650-9160 APPROVED: APPROVED: Finance MIS The City Council has appropriated $358,090.00 in Fiscal Year 2010 and $296,989.00 in Fiscal Year 2011 from federal HOME Program grant funds. ENVIRONMENTAL REVIEW: The program is exempt from Environmental Review. ORDINANCE: INTRODUCTION: FINAL ADOPTION: STAFF RECOMMENDATION: Adopt the resolution. BOARD / COMMISSION RECOMMENDATION: ATTACHMENTS: achment No. 1: First -Time Homebuyer Assistance Program Summary Attachment No. 2: First -Time Homebuyer Assistance Program Manual Attachment No. 3: HOME Subrecipient Agreement OFFICE OF THE CITY CLERK 1243 National City Blvd. National City, California 91950 Michael R. Dalla, CMC - City Clerk 619-336-4228 phone • 619-336-4229 fax COMMUNITY HOUSINGWORKS REALTY & LENDING, INC. Resolution No. 2010-142 First Time Homebuyer Assistance Program Carlos Aguirre (Housing & Grants) Forwarded Copy of Agreement to Sub -Recipient