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HomeMy WebLinkAbout2012 CON CDC HA (Subordination Agreement) Ramon and Leticia Rodriguez - 2004 "B" AvenueNOTE TO FILE 09-16-14 IN THE MATTER OF: Resolution of the Community Development Commission — Housing Authority of the City of National City authorizing the Chairman to execute a Subordination Agreement allowing a new mortgage not -to -exceed $194,950 to be and remain a lien prior and superior to a first-time homebuyer assistance loan of $27,250 on a single -unit property located in National City. Please note the following: NO FULLY EXECUTED ORIGINAL SUBORDINATION AGREEMENT WAS FILED WITH THE OFFICE OF THE CITY CLERK ORIGINATING DEPARTMENT: _ CDC X Housing & Grants City Attorney _ Human Resources City Manager _ MIS Community Svcs. Planning Engineering _ Police Finance Public Works Fire NTF Attachment No. 1 CO, .NUATION OF SUBORDINATION AGREEM.._,4T RECORDING REQUESTED BY: Transamerican Escrow Company Order No. I3215088 Escrow No. 3488-JH Parcel No. 560-262-11-00 AND WHEN RECORDED MAIL TO: THE COMMUNITY DEVELOPMENT COMISSION OF THE CITY OF NATIONAL CITY 1243 NATIONAL CITY BLVD. NATIONAL CITY, CA. 91950 SPACE ABOVE THIS LINE FOR RECORDER'S USE SUBORDINATION AGREEMENT NOTICE: TIIIS SUBORDINATION AGREEMENT RESULTS IN YOUR SECURITY INTEREST IN THE PROPERTY BECOMING SUBJECT TO AND OF LOWER PRIORITY THAHE LIEN OF SOME OTHER OR LATER SECURITY INSTRUMENT. THIS AGREEMENT; made this 06 day of February, 2012, by Ramon Rodriguez and Leticia Rodriguez, Husband and Wife as Joint Tenants owner of the land hereinafter described and hereinafter referred to as "Owner", and present owner and holder of the deed of trust and note first hereinafter described and hereinafter referred to as "Beneficiary"; WITNESSETH THAT WHEREAS, Ramon Rodriguez did on 10/4/2002, execute a deed of trust to The Community Development Commission of the City of National City, as trustee, covering: The Easterly 80 feet of Lots 19 and 20 in Block 2 of the Subdivision of 10 acre Lot 5 in the Block 153 of Rancho De La Nacion (commonly called Sherman's Subdivision), in the City of National City, County of San Diego, State of California, according to the Map thereof No. 200, filed in the Office of the County Recorder of San Diego, County, January 26, 1882. to secure a note in the sum of S27,250.00, dated 10/24/2002, in favor of The Community Development Commission of the City of National City, which deed of trust was recorded 10/07/2002, as Instrument No. 2002- 0864853, Official Records of said county and is subject and subordinate to the deed of trust next hereinafter described; and WHEREAS, Ramon Rodriguez did on , execute a deed of trust to LSI Title Company, as trustee, covering said land and securing an indebtedness not to exceed the amount of $194,950.00, in favor of JPMorgan Chase Bank, N.A., hereinafter referred to as "Lender", which deed of trust is recording concurrently herewith, Official Records of said county and provides among other things that it shall also secure additional loans and advances thereafter made upon the terms and conditions set forth; and WHEREAS, Owner has executed, or is about to execute, a note not to exceed loan amount of S194,950.00, dated , in favor of Lender, payable with interest and upon the terms and conditions described therein, which note evidences an additional loan to be made by Lender to Owner under the terms and conditions described therein, and secured by said deed of trust in favor of Lender; and WHEREAS, it is a condition precedent to obtaining said loan that said deed of trust last above mentioned shall unconditionally be and remain at all times a lien or charge upon the land hereinbefore described, prior and superior to the lien or charge of the deed of trust first above mentioned; and WHEREAS, Lender is willing to make said loan provided the deed of trust securing the same is a lien or charge upon the above described property prior and superior to the lien or charge of the deed of trust first above mentioned and provided that Beneficiary will specifically and unconditionally subordinate the lien or charge of the deed of trust first above mentioned to the lien or charge of the deed of trust in favor of Lender; and Attachment No.1 WHEREAS, it is to the mutual benefit of the parties hereto that Lender make such loan to Owner; and Beneficiary is willing that the deed of trust securing the same shall, when recorded, constitute a lien or charge upon said land which is unconditionally prior and superior to the lien or charge of the deed of trust above mentioned. NOW, THEREFORE, in consideration of the mutual benefits accruing to the parties hereto and other valuable consideration, the receipt and sufficiency of which consideration is hereby acknowledged, and in order to induce Lender to make the loan above referred to, it is hereby declared, understood and agreed as follows: 1. That said deed of trust securing said note in favor of Lender, and any renewals or extensions thereof, shall unconditionally be and remain at all times a lien or charge on the property therein described, prior and superior to the lien or charge of the deed of trust first above mentioned. 2. That Lender would not make its loan above described without this subordination agreement. 3. That this agreement shall be the whole and only agreement with regard to the subordination of the lien or charge of the deed of trust first above mentioned to the lien or charge of the deed of trust in favor of lender above referred to and shall supersede and cancel, but only insofar as would affect the priority between the deeds of trust hereinbefore specifically described, any prior agreement as to such subordination including, but not limited to, those provisions, if any, contained in the deed of trust first above mentioned, which pro for the subordination of the lien or charge thereof to another deed or deed of trust or to another r ga or mortgages. Beneficiary declares, agrees and acknowledges that (a) He consents to and approves (i) all provisions of the note and deed of trust in favor of Lender above referred to, and (ii) all agreements, including but not limited to any loan or escrow agreements, between Owner and Lender for the disbursement of the proceeds of Lender's loan; (b) Lender in making disbursements pursuant to any such agreement is under no obligation or duty to, nor has Lender represented that it will see to the application of such proceeds by the person or persons to whom Lender disburses such proceeds and any application or use of such proceeds for purposes other than those provided for in such agreement or agreements shall not defeat the subordination herein made in whole or in part; (c) He intentionally and unconditionally waives, relinquishes and subordinates the lien or charge of the deed of trust first above mentioned in favor of the lien or charge upon said land of the deed of trust in favor of Lender above referred to and understands that in reliance upon, and in consideration of, this waiver, relinquishment and subordination specific loans and advances are being and will be made and, as part and parcel thereof, specific monetary and other obligations are being and will be entered into which would not be made or entered into but for said reliance upon this waiver, relinquishment and subordination; and (d) An endorsement has been placed upon the note secured by deed of trust first above mentioned that said deed of trust has by this instrument been subordinated to the lien or charge of the deed of trust in favor of Lender above referred to. NOTICE: THIS SUBORDINATION AGREEMENT CONTAINS A PROVISION WHICH ALLOWS THE PERSON OBLIGATED ON YOUR REAL PROPERTY SECURITY TO OBTAIN A LOAN A PORTION OR WHICH MAY BE EXPENDED FOR OTHER PURPOSES THAN IMPROVEMENT OF THE LAND. BENEFICIARY OWNER Mortgagee, The Community Development Ramon Rodriguez Commission of the City of National City Mortgagee, The Community Development Commission of the City of National City (ALL SIGNATURES MUST BE ACKNOWLEDGED BY A NOTARY) IT IS RECOMMENDED THAT, PRIOR TO THE EXECUTION OF THIS SUBORDINATION AGREEMENT THE PARTIES CONSULT WITH THEIR ATTORNEYS WITH RESPECT THERETO. (CLTA SUBORDINATION FORM "C") RESOLUTION NO. 2012 — 2 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION — HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY AUTHORIZING THE CHAIRMAN TO EXECUTE A SUBORDINATION AGREEMENT ALLOWING A NEW MORTGAGE NOT -TO -EXCEED $194,950 TO BE AND REMAIN A LIEN PRIOR AND SUPERIOR TO A FIRST-TIME HOMEBUYER ASSISTANCE LOAN OF $27,250 ON A SINGLE -UNIT PROPERTY LOCATED IN NATIONAL CITY WHEREAS, the Community Development Commission — Housing Authority of the City of National City ("CDC -HA") made a loan of $25,000 ("CDC -HA Loan") issued from the HOME Investment Partnerships Program to Ramon Rodriguez ("Borrower") on October 4, 2002, to assist an eligible household in the purchase of a single-family house located at 2004 B Avenue in National City (the "Property"); and WHEREAS, the CDC -HA Loan is fully deferred until 2032, as long as the residence is occupied by the Borrower, and the Borrower performs under all other Covenants and Agreements contained in the Deed of Trust of the CDC -HA Loan; and WHEREAS, the Borrower is interested in refinancing the debt on the property and has been approved for a new loan with JP Morgan Chase Bank (the "Lender") that requires the CDC -HA to execute a Subordination Agreement allowing the new loan to hold superior position to the CDC -HA Loan that will maintain second lien position on the Property; and WHEREAS, the purpose of the refinance is to allow the Borrower to reduce the interest rate paid on their current mortgage to 4.00% with no cash proceeds to the Borrower through the escrow tied to the refinance; and WHEREAS, maintaining a second lien position pursuant to the Borrower refinancing to a lower interest rate without cash -out acts to further preserve and secure the CDC -HA interest in the Property. NOW, THEREFORE, BE IT RESOLVED that the Community Development Commission — Housing Authority of the City of National City hereby authorizes the Chairman to execute a Subordination Agreement in favor of a new First Trust Deed with JP Morgan Chase Bank as beneficiary. After being recorded by the County of San Diego, said Subordination Agreement will be on file in the office of the City Clerk. PASSED and ADOPTED this 21st day of Febr , 2012. on Morrison, rman ATTEST: Leslie Deese, Secretary RO ED AS TO FORM: ola V.' CDC Ge Silva unsel Passed and adopted by the Community Development Commission - Housing Authority of the City of National City, California, on February 21, 2012 by the following vote, to - wit: Ayes: Boardmembers Morrison, Natividad, Rios, Sotelo-Solis, Zarate. Nays: None. Absent: None. Abstain: None. AUTHENTICATED BY: RON MORRISON Chairman, Housing Authority Secretary, Housing Authority By: Deputy I HEREBY CERTIFY that the above and foregoing is a full, true and correct copy of RESOLUTION NO. 2012-2 of the Community Development Commission - Housing Authority of the City of National City, California, passed and adopted on February 21, 2012. Secretary, Housing Authority By: Deputy CITY OF NATIONAL CITY, CALIFORNIA COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY COUNCIL AGENDA STATEMENT ETING DATE: February 21, 2012. AGENDA ITEM NO. 24 ITEM TITLE: Resolution of the Community Development Commission- Housing Authority of the City of National City authorizing the Chairman to execute a Subordination Agreement with Ramon Rodriguez allowing a new mortgage not -to -exceed $194,950 to be and remain a lien prior and superior to a First -Time Home Buyer assistance loan of $27,250 on a single -unit property located at 2004 "B" Avenue in National City PREPARED BY: Carlos Aguirre, Comm. Dev. Specialist I - DEPARTMENT: Ad"ntstratie Services PHONE: 619 336-4391 APPROVED BY------z�� EXPLANATION: The Housing Authority of the Community Development Commission of the City of National City (CDC -HA) made a loan for $27,250 from the HOME Investment Partnerships Fund to Ramon Rodriguez ("Borrower") on 10/4/2002 to assist the eligible household in the purchase of single-family residence located at 2004 "B" Avenue in National City. The CDC -HA loan is fully deferred for 30 years as long as the residence is occupied by the Borrower and the Borrower performs under all other Covenants and Agreements contained in the Deed of Trust of the CDC -HA loan. The Borrower is interested in refinancing the first lien on the property and has been approved for a new loan with JP Morgan Chase Bank. The new lender is requiring that the CDC -HA execute a subordination agreement allowing the new loan to hold superior position to the CDC -HA issued loan. The CDC -HA loan will maintain second lien position on the property. The purpose of the refinance is to allow the Borrower to reduce the interest rate paid to a fixed 4.00% il interest rate and there will be no cash proceeds to the Borrowers through the refinance. Staff has also satisfactorily sewed the preliminary title report, new loan terms, and closing statement. The Borrower is applying for a special rogram to save their home from potential foreclosure. The program allows the Borrower to refinance without sustaining a value that is more than the first loan. It is in the CDC-HA's best interest to subordinate and protect against future loss to the CDC -HA due to foreclosure on the current loan. The CDC-HA's legal copnsel will be provided the new Deed of Trust to review before the Subordination Agreement is fully executed. FINANCIAL STATEMENT: APPROVED: ACCOUNT NO. APPROVED: There is no immediate fiscal impact associated with this request. The CDC- Housing Authority is strengthening its position to collect on the asset by subordinating to the new loan. ENVIRONMENTAL REVIEW: The subordination agreement is exempt from environmental review. ORDINANCE: INTRODUCTION: FINAL ADOPTION: Finance MIS STAFF RECOMMENDATION: Staff recommends the adoption of a resolution to execute the Subordination Agreement. BOARD / COMMISSION RECOMMENDATION: There is no board or commission recommendation required for the Subordination Agreement. 91TACHMENTS: 1. Draft Subordination Agreement between CDC -HA and Borrower Attachment No. 1 CO, .NUATION OF SUBORDINATION AGREEN...;JT RECORDING REQUESTED BY: "fransamerican Escrow Company Order No. 13215088 Escrow No. 3488-JH Parcel No. 560-262-11-00 AND WHEN RECORDED NIAIL TO: THE COMMUNITY DEVELOPMENT COMISSION OF THE CITY OF NATIONAL CITY 1243 NATIONAL CITY BLVD. NATIONAL CITY, CA. 91950 SPACE ABOVE THIS LINE FOR RECORDER'S USE SUBORDINATION AGREEMENT NOTICE: THIS SUBORDINATION AGREEMENT RESULTS IN YOUR SECURITY INTEREST IN THE PROPERTY BECOMING SUBJECT TO AND OF LOWER PRIORITY THANHE LIEN OF SOME OTHER OR LATER SECURITY INSTRUMENT. THIS AGREEMENT, made this 06 day of February, 2012, by Ramon Rodriguez and Leticia Rodriguez, Husband and Wife as Joint Tenants owner of the land hereinafter described and hereinafter referred to as "Owner", and present owner and holder of the deed of trust and note first hereinafter described and hereinafter referred to as "Beneficiary"; WITNESSETH THAT WHEREAS, Ramon Rodriguez did on 10/4/2002, execute a deed of trust to The Community Development Commission of the City of National City, as trustee, covering: The Easterly 80 feet of Lots 19 and 20 in Block 2 of the Subdivision of 10 acre Lot 5 in the Block 153 of Rancho De La Nacion (commonly called Sherman's Subdivision), in the City of National City, County of San Diego, State of California, according to the Map thereof No. 200, filed in the Office of the County Recorder of San Diego, County, January 26, 1882. to secure a note in the sum of S27,250.00, dated 10/24/2002, in favor of The Community Development Commission of the City of National City, which deed of trust was recorded 10/07/2002, as Instrument No. 2002- 0864853, Official Records of said county and is subject and subordinate to the deed of trust next hereinafter described; and WHEREAS, Ramon Rodriguez did on , execute a deed of trust to LSI Title Company, as trustee, covering said land and securing an indebtedness not to exceed the amount of S194,950.00, in favor of JPMorgan Chase Bank, N.A., hereinafter referred to as "Lender", which deed of trust is recording concurrently herewith, Official Records of said county and provides among other things that it shall also secure additional loans and advances thereafter made upon the terms and conditions set forth; and WHEREAS, Owner has executed, or is about to execute, a note not to exceed loan amount of S194,950.00, dated , in favor of Lender, payable with interest and upon the terms and conditions described therein, which note evidences an additional loan to be made by Lender to Owner under the terms and conditions described therein, and secured by said deed of trust in favor of Lender; and WHEREAS, it is a condition precedent to obtaining said loan that said deed of trust last above mentioned shall unconditionally be and remain at all times a lien or charge upon the land hereinbefore described, prior and superior to the lien or charge of the deed of trust first above mentioned; and WHEREAS, Lender is willing to make said loan provided the deed of trust securing the same is a lien or charge upon the above described property prior and superior to the lien or charge of the deed of trust first above mentioned and provided that Beneficiary will specifically and unconditionally subordinate the lien or charge of the deed of trust first above mentioned to the lien or charge of the deed of trust in favor of Lender; and Attachment No.1 WHEREAS, it is to the mutual benefit of the parties hereto that Lender make such loan to Owner; and Beneficiary is willing that the deed of trust securing the same shall, when recorded, constitute a lien or charge upon said land which is unconditionally prior and superior to the lien or charge of the deed of trust above mentioned. NOW, THEREFORE, in consideration of the mutual benefits accruing to the parties hereto and other valuable consideration, the receipt and sufficiency of which consideration is hereby acknowledged, and in order to induce Lender to make the loan above referred to, it is hereby declared, understood and agreed as follows: 1. That said deed of trust securing said note in favor of Lender, and any renewals or extensions thereof, shall unconditionally be and remain at all times a lien or charge on the property therein described, prior and superior to the lien or charge of the deed of trust first above mentioned. 2. That Lender would not make its loan above described without this subordination agreement. 3. That this agreement shall be the whole and only agreement with regard to the subordination of the lien or charge of the deed of trust first above mentioned to the lien or charge of the deed of trust in favor of lender above referred to and shall supersede and cancel, but only insofar as would affect the priority between the deeds of trust hereinbefore specifically described, any prior agreement as to such subordination including, but not limited to, those provisions, if any, contained in the deed of trust first above mentioned, which pro for the subordination of the hen or charge thereof to another deed or deed of trust or to another rt a or mortgages. Beneficiary declares, agrees and acknowledges that (a) He consents to and approves (i) all provisions of the note and deed of trust in favor of Lender above referred to, and (ii) all agreements, including but not limited to any loan or escrow agreements, between Owner and Lender for the disbursement of the proceeds of Lender's loan; (b) Lender in making disbursements pursuant to any such agreement is under no obligation or duty to, nor has Lender represented that it will see to the application of such proceeds by the person or persons to whom Lender disburses such proceeds and any application or use of such proceeds for purposes other than those provided for in such agreement or agreements shall not defeat the subordination herein made in whole or in part; (c) He intentionally and unconditionally waives, relinquishes and subordinates the lien or charge of the deed of trust first above mentioned in favor of the lien or charge upon said land of the deed of trust in favor of Lender above referred to and understands that in reliance upon, and in consideration of, this waiver, relinquishment and subordination specific loans and advances are being and will be made and, as part and parcel thereof, specific monetary and other obligations are being and will be entered into which would not be made or entered into but for said reliance upon this waiver, relinquishment and subordination; and (d) An endorsement has been placed upon the note secured by deed of trust first above mentioned that said deed of trust has by this instrument been subordinated to the lien or charge of the deed of trust in favor of Lender above referred to. NOTICE: THIS SUBORDINATION AGREEMENT CONTAINS A PROVISION WHICH ALLOWS THE PERSON OBLIGATED ON YOUR REA1. PROPERTY SECURITY TO OBTAIN A LOAN A PORTION OR WHICH MAY BE EXPENDED FOR OTHER PURPOSES THAN IMPROVEMENT OF THE LAND. BENEFICIARY OWNER Mortgagee, The Community Development Ramon Rodriguez Commission of the City of National City Mortgagee, The Community Development Commission of the City of National City (ALL SIGNATURES MUST BE ACKNOWLEDGED BY A NOTARY) IT IS RECO WENDED THAT, PRIOR TO THE EXECUTION OF THIS SUBORDINATION AGREEMENT THE, PARTIES CONSULT WITH THEIR ATTORNEYS WITH RESPECT THERETO (CLTA SUBORDINATION FORM "C") RESOLUTION NO. 2012 — RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION — HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY AUTHORIZING THE CHAIRMAN TO EXECUTE A SUBORDINATION AGREEMENT ALLOWING A NEW MORTGAGE NOT -TO -EXCEED $194,950 TO BE AND REMAIN A LIEN PRIOR AND SUPERIOR TO A FIRST-TIME HOMEBUYER ASSISTANCE LOAN OF $27,250 ON A SINGLE -UNIT PROPERTY LOCATED IN NATIONAL CITY WHEREAS, the Community Development Commission — Housing Authority of the City of National City ("CDC -HA") made a loan of $25,000 ("CDC -HA Loan") issued from the HOME Investment Partnerships Program to Ramon Rodriguez ("Borrower") on October 4, 2002, to assist an eligible household in the purchase of a single-family house located at 2004 B Avenue in National City (the "Property"); and WHEREAS, the CDC -HA Loan is fully deferred until 2032, as long as the residence is occupied by the Borrower, and the Borrower performs under all other Covenants and Agreements contained in the Deed of Trust of the CDC -HA Loan; and WHEREAS, the Borrower is interested in refinancing the debt on the property and has been approved for a new loan with JP Morgan Chase Bank (the "Lender") that requires the CDC -HA to execute a Subordination Agreement allowing the new loan to hold superior position to the CDC -HA Loan that will maintain second lien position on the Property; and WHEREAS, the purpose of the refinance is to allow the Borrower to reduce the interest rate paid on their current mortgage to 4.00% with no cash proceeds to the Borrower through the escrow tied to the refinance; and WHEREAS, maintaining a second lien position pursuant to the Borrower refinancing to a lower interest rate without cash -out acts to further preserve and secure the CDC -HA interest in the Property. NOW, THEREFORE, BE IT RESOLVED that the Community Development Commission — Housing Authority of the City of National City hereby authorizes the Chairman to execute a Subordination Agreement in favor of a new First Trust Deed with JP Morgan Chase Bank as beneficiary. After being recorded by the County of San Diego, said Subordination Agreement will be on file in the office of the City Clerk. PASSED and ADOPTED this 21st day of February, 2012. Ron Morrison, Chairman ATTEST: APPROVED AS TO FORM: Brad Raulston, Secretary Claudia Gacitua Silva CDC General Counsel