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2017 CON (DEED OF TRUST and Regulatory Agreement) Cesar Escoto - 1918 Rachael Avenue
Recorded Request Of FIDELITY NATIONAL TITLE SAN DREG" OFFICE FREE RECORDING REQUESTED PURSUANT TO GOVERNMENT CODE SECTION 27383 WHEN RECORDED PLEASE MAIL TO: San Diego Habitat for Humanity ATTN: KC Clifford 10222 San Diego Mission Road San Diego, CA 92108 go9- L APN: 558-270-21-00 DOC# 2017-0123737 11 IIIIIIIIIIIIII III IIIIIIIIIIIIIIIIIIIIIIIIIII III 11 Mar 17, 2017 02:30 PM OFFICIAL RECORDS Ernest J. Dronenburg, Jr., SAN DIEGO COUNTY RECORDER FEES: $0.00 PAGES: 11 THIS SPACE FOR RECORDER'S USE ONLY LOAN# 03072017-ESCOTO NOTICE: THIS DEED OF TRUST SECURES A SHARED APPRECIATION LOAN WITHIN THE MEANING OF CIVIL CODE SECTION 1917, ET SEQ. THE LOAN SECURED BY THIS DEED OF TRUST MAY REQUIRE PAYMENT OF PRINCIPAL, INTEREST AND A PORTION OF THE APPRECIATION UPON THE SALE OR TRANSFER OF THE PROPERTY OR UPON A PREPAYMENT. DEED OF TRUST (SHARED APPRECIATION) THIS DEED OF TRUST, is made this March 7th, 2017 among the Trustor(s), Cesar Escoto, A Married Man as His Sole and Separate Property (herein "Borrower"), and the City of National City (herein "Beneficiary') a public body, corporate and politic, whose address is 1243 National City Blvd., National City, CA 91950. BORROWER, in consideration of the indebtedness herein recited and the trust herein created, irrevocably grants and conveys to Lawyers Title Insurance Company (herein "Trustee"), in trust, with power of sale, the following described property located in the City of National City, County of San Diego, State of California [which has the address of 1918 Rachael Avenue, National City, CA 91950 (herein "Property Address")]: SEE EXHIBIT "A" ATTACHED HERETO FOR LEGAL DESCRIPTION This Deed of Trust is second and subsequent in lien priority position to a First Deed of Trust recording concurrently herewith in favor of the first lien holder, Envoy Mortgage, $236,000.00 (Two hundred thirty six thousand dollars and 00/100). TOGETHER with all the improvements now and hereafter erected on the Property, and all easements, rights, appurtenances and rents (subject however to the rights and authorities given herein to the Beneficiary to collect and apply such rents), all of which shall be deemed to be and remain part of the property covered by this Deed of Trust; and all of the foregoing, together with said property (or the leasehold estate if this Deed of Trust is on a leasehold) are hereinafter referred to as the "Property"; TO SECURE to the Beneficiary the (i) repayment of the indebtedness evidenced by Borrower's promissory note, dated March 7th, 2017 and extensions and renewals thereof (herein "Note"), in the principal sum of $89,000.00 (Eighty nine thousand dollars and 00/100), including without limitation the Equity sharing provisions thereof (the term "Equity' shall have the meaning ascribed to it in the Note Rider attached to the Note); (ii) the performance of each agreement and covenant of Borrower under that certain Homeowner's Regulatory Agreement for Home Program Participation ("Home Agreement") of even date herewith and recorded concurrently herewith affecting the Property; (iii) the payment of all other sums with interest thereon, Rev 10.17.2012 Page 1 of 10 Initials Cc A.st- Recorded Request Of FIDELITY NATIONAL TITLE SAN DIEGO OFFICE FREE RECORDING REQUESTED PURSUANT TO GOVERNMENT CODE SECTION 27383 WHEN RECORDED PLEASE MAIL TO: San Diego Habitat for Humanity ATTN: KC Clifford 10222 San Diego Mission Road San Diego, CA 92108 THIS DOCUMENT HAS BEEN ELECTRONICALLY RECORDED. SEE THEATTACHED FOR RECORDING INFORMATION THIS SPACE FOR RECORDER'S USE ONLY APN: 558-270-21-00 LOAN# 03072017-ESCOTO NOTICE: THIS DEED OF TRUST SECURES A SHARED APPRECIATION LOAN WITHIN THE MEANING OF CIVIL CODE SECTION 1917, ET SEQ. THE LOAN SECURED BY THIS DEED OF TRUST MAY REQUIRE PAYMENT OF PRINCIPAL, INTEREST AND A PORTION OF THE APPRECIATION UPON THE SALE OR TRANSFER OF THE PROPERTY OR UPON A PREPAYMENT. DEED OF TRUST (SHARED APPRECIATION) THIS DEED OF TRUST, is made this March 7th, 2017 among the Trustor(s), Cesar Escoto, A Married Man as His Sole and Separate Property (herein "Borrower"), and the City of National City (herein "Beneficiary") a public body, corporate and politic, whose address is 1243 National City Blvd., National City, CA 91950. BORROWER, in consideration of the indebtedness herein recited and the trust herein created, irrevocably grants and conveys to Lawyers Title Insurance Company (herein "Trustee"), in trust, with power of sale, the following described property located in the City of National City, County of San Diego, State of California [which has the address of 1918 Rachael Avenue, National City, CA 91950 (herein "Property Address")]: SEE EXHIBIT "A" ATTACHED HERETO FOR LEGAL DESCRIPTION This Deed of Trust is second and subsequent in lien priority position to a First Deed of Trust recording concurrently herewith in favor of the first lien holder, Envoy Mortgage, $236,000.00 (Two hundred thirty six thousand dollars and 00/100). TOGETHER with all the improvements now and hereafter erected on the Property, and all easements, rights, appurtenances and rents (subject however to the rights and authorities given herein to the Beneficiary to collect and apply such rents), all of which shall be deemed to be and remain part of the property covered by this Deed of Trust; and all of the foregoing, together with said property (or the leasehold estate if this Deed of Trust is on a leasehold) are hereinafter referred to as the "Property"; TO SECURE to the Beneficiary the (i) repayment of the indebtedness evidenced by Borrower's promissory note, dated March 7th, 2017 and extensions and renewals thereof (herein "Note"), in the principal sum of $89,000.00 (Eighty nine thousand dollars and 00/100), including without limitation the Equity sharing provisions thereof (the term "Equity" shall have the meaning ascribed to it in the Note Rider attached to the Note); (ii) the performance of each agreement and covenant of Borrower under that certain Homeowner's Regulatory Agreement for Home Program Participation ("Home Agreement") of even date herewith and recorded concurrently herewith affecting the Property; (iii) the payment of all other sums with interest thereon, Rev 10.17.2012 Page 1 of 10 Initials t ) f\ t advanced in accordance herewith to protect the security of this Deed of Trust; and (iv) the performance of the covenants and agreements of Borrower herein contained. Borrower covenants that Borrower is lawfully seized of the estate hereby conveyed and has the right to grant and convey the Property, and that the Borrower's subject property is unencumbered except for encumbrances of record. Borrower covenants that Borrower warrants and will defend generally the title to the Property against all claims and demands, subject to encumbrances of record. UNIFORM COVENANTS Borrower and Beneficiary covenant and agree as follows: 1. Payment of Principal and Interest. Borrower shall promptly pay when due the principal and interest indebtedness evidenced by the Note. If payment of the indebtedness is required due to a Sale of the Property where the purchase price is equal to or less than the Acquisition Cost of the Property, assuming an open and competitive sale, then repayment shall be made in the following order and amount: (a) Outstanding principal and interest balance of the primary lender's loan; (b) Borrower's initial down -payment investment and normal cost of sale; (c) Accrued simple interest on the principal amount of the Beneficiary's loan at the interest rate and the terms contained in the Promissory Note; (d) The principal amount of the Beneficiary's loan; and (e) Any remainder to borrower. 2. Funds for Taxes and Insurance. To protect the security of the Deed of Trust, Trustor agrees to pay, at least ten (10) days before delinquency, all taxes and assessments affecting said property; when due, all encumbrances, charges and liens, with interest, on said property or any part thereof, which appear to be prior or superior hereto; and all costs, fees and expenses of this Deed of Trust. Should Trustor fail to make any payment or to do any act as herein provided, then Beneficiary, without obligation to do so and without notice to or demand upon Trustor and without releasing Trustor from any obligation hereof, may make or do the same in such manner and to such extent as either may deem necessary to protect the security hereof, Beneficiary or Trustee being authorized to enter upon said property for such purposes; appear in and defend any action or proceeding purporting to affect the security hereof or the rights powers of Beneficiary or Trustee; pay, purchase, contest or compromise any encumbrance, charge or lien which in the judgment of either appears to be prior or superior hereto; and, in exercising any such powers, pay necessary expenses, employ counsel and pay his/her reasonable fees. 3. Application of Payments. Unless applicable law provides otherwise, and except as provided in Section 1, above, all payments received by Beneficiary hereunder shall be applied; first, to any prepayment charges due under the Note; second, to amounts payable under section 2; third, to interest due; fourth, to principal due; and last, to any late charges due under the Note. Prior Mortgages and Deeds of Trust; Charges; Liens. Borrower shall perform all of Borrower's obligations under any mortgage, deed of trust or other security agreement with a lien against the Property, including without limitation, Borrower's covenants to make payments when due. Borrower shall pay or cause to be paid all taxes, assessments and other charges, fines and impositions attributable to the Property which may attain a priority over this Deed of Trust, and leasehold payments or ground rents, if any. 5. Hazard Insurance. Borrower shall keep the improvement(s) now existing or hereinafter erected on the Property insured against loss by fire, hazards included within the term "extended coverage", and such other hazards as Beneficiary may require and in such amounts and for such periods as Beneficiary may require. The insurance carrier providing the insurance shall be chosen by Borrower subject to approval by Beneficiary; provided, that such approval will not be unreasonably withheld. All insurance policies and renewals thereof shall be in a form Rev 10.17.2012 Page 2 of 10 InitialsCE ACE acceptable to Beneficiary and shall include a standard mortgage clause in favor of and in a form acceptable to Beneficiary. Beneficiary has the right to hold the policies and renewals thereof, subject to the terms of any mortgage, deed of trust or other security agreement with a lien which has priority over this Deed of Trust. In the event of loss, Borrower shall give prompt notice to the insurance carrier and Beneficiary. Beneficiary may make proof of loss if not made promptly by Borrower. If Property is abandoned by Borrower, or if Borrower fails to respond to Beneficiary within 30 days from the date notice is mailed by Beneficiary to Borrower that the insurance carrier offers to settle a claim for insurance benefits, Beneficiary is authorized to collect and apply the insurance proceeds at Beneficiary's option either to restoration or repair of the Property or to the sums secured by this Deed of Trust. 6. Preservation and Maintenance of Property, Condominium, Cooperatives, Planned Unit Developments. Borrower will keep the Property in good repair and shall not commit waste or permit impairment or deterioration of the Property and shall maintain property including the principle house, garage, and out buildings as well as lawn maintenance, and shall comply with the provisions of any lease if this Deed of Trust is on a leasehold. If this Deed of Trust is on a unit in a condominium or a planned unit development, Borrower shall perform all of Borrower's obligations under the declaration or covenants, conditions and restrictions, creating or governing the condominium, planned unit development, the by-laws and regulations of the condominium or planned unit development, and constituent documents. 7. Protection of Beneficiary Security. If Borrower fails to perform the covenants and agreements contained in this Deed of Trust, or if any action or proceeding is commenced which materially affects Beneficiary's interest in the Property, then Beneficiary, at Beneficiary's option, upon notice to Borrower, may make such appearances, disburse such sums including reasonable attorneys' fees, and take such action as is necessary to protect Beneficiary's interest. If Beneficiary required mortgage insurance as a condition of making the loan secured by this Deed of Trust, Borrower shall pay the premiums required to maintain such insurance in effect until such time as the requirement for such insurance terminates in accordance with Borrower's and Beneficiary's written agreement or applicable law. Any amounts disbursed by Beneficiary pursuant to this Paragraph, with interest thereon, at the original Note rate, will become additional indebtedness of Borrower secured by this Deed of Trust. Unless Borrower and Beneficiary agree to other terms of payment, such amounts will be payable upon notice from Beneficiary to Borrower requesting payment thereof. Nothing contained in this Paragraph will require Beneficiary to incur any expense or take any action hereunder. 8. Inspection. Beneficiary may make or cause to be made reasonable entries upon and inspections of the Property, provided that Beneficiary will give the Borrower notice prior to any such inspection specifying reasonable cause therefore related to Beneficiary's interest in the Property. 9. Condemnation. The proceeds of any award or claim for damages, direct or consequential, in connection with any condemnation or other taking the Property, or part thereof, or for conveyance in lieu of condemnation, are hereby assigned and shall be paid to Beneficiary subject to the terms of any mortgage, deed of trust or other security agreement with a lien which has priority over this Deed of Trust. 10. Borrower Not Released; Forbearance by Beneficiary Not a Waiver. Extension of the time for payment or modification of payment of the sums secured by this Deed of Trust granted by Beneficiary to any successor in interest of Borrower shall not operate to release, in any manner, the liability of the original Borrower and Borrower's successors in interest. Beneficiary shall not be required to commence proceedings against such successor or to extend time for payment or otherwise modify payment of the sums secured by this Deed of Trust by reason of any demand made by the original Borrower and Borrower's successors in interest. Any forbearance by Beneficiary in exercising any right or remedy hereunder, or otherwise afforded by applicable law, shall not be a waiver of or preclude the exercise of any such right or remedy. 11. Successors and Assigns Bound, Joint and Several Liability; Co-signers. The covenants and agreements herein contained shall bind, and the rights hereunder shall inure to, the respective successors and assigns of Beneficiary and Borrower, subject to the provisions of Paragraph 16 hereof. All covenants and agreements of Borrower shall be joint and several. Any Borrower who co-signs this Deed of Trust, but does not execute the Note: Rev 10.17.2012 (a) Is co-signing this Deed of Trust only to grant and convey that Borrower's interest in the Property to Trustee under the terms of this Deed of Trust, (b) Is not personally liable on the Note or under this Deed of Trust, and Page 3 of 10 Initials'— �� (c) Agrees that the Beneficiary and any other Borrower hereunder may agree to extend, modify, forbear, or make any other accommodations with regard to the terms of this Deed of Trust or the Note, without that Borrower's consent and without releasing that Borrower or modifying this Deed of Trust as to that Borrower's interest in the Property. 12. Notice. Except for any notice required under applicable law to be given in another manner, any notice to Borrower provided for in this Deed of Trust shall be given by delivering it or by mailing such notice by certified mail, addressed to Borrower at the Property address or such other address as Borrower may designate by notice to Beneficiary as provided herein, and (a) Any notice to Beneficiary will be given by certified mail, return receipt requested, to Beneficiary address stated herein or to such other address as Beneficiary may designate by notice to Borrower as provided herein. (b) Any Notice provided for in this Deed of Trust shall be deemed to have been given to Borrower or Beneficiary when given in the manner designated herein. 13. Governing Law, Severability. The state and local laws applicable to this Deed of Trust shall be the laws of the jurisdiction in which the Property is located. The foregoing sentence shall not limit the applicability of Federal law to this Deed of Trust. In the event that any provision or clause of this Deed of Trust or the Note conflicts with applicable law, such conflict shall not affect other provisions of this Deed of Trust or the Note which can be given effect without the conflicting provision, and to this end the provisions of this Deed of Trust and the Note are declared to be severable. As used herein, "costs", "expenses" and "attorneys' fees" include all sums to the extent not prohibited by applicable law or limited herein. 14. Borrower's Copy. Borrower shall be furnished a conformed copy of the Note and this Deed of Trust at the time of execution or after recordation hereof. 15. HOME Agreement. Borrower shall fulfill all of Borrower's other loan agreement(s) which Borrower enters into with the Beneficiary, including, without limitation, the HOME Agreement with the Beneficiary. 16. Rehabilitation Loan Agreement. Borrower shall fulfill all of Borrower's obligations under any home rehabilitation, improvement, repair, or other loan agreement which Borrower enters into with Beneficiary. Beneficiary, at Beneficiary's option, may require Borrower to execute and deliver to Beneficiary, in a form acceptable to Beneficiary, an assignment of any rights, claims or defenses which Borrower may have against parties who supply labor, materials or services in connection with improvements made to the Property. 17. Transfer of the Property or a Beneficial Interest in Borrower. If there is a "transfer", the principal amount of the Note, together with a share of the "Equity" (if any), as hereafter defined, shall be immediately due and payable to the Beneficiary. A "transfer" means (i) all or any part of the Property or any interest in the Property is sold, conveyed or transferred; (ii) Borrower is not a natural person and a beneficial interest in Borrower is sold, conveyed or transferred; (iii) all or any part of the Property is refinanced, except as otherwise allowed by law; (iv) Borrower does not occupy the Property as his, her, or their, primary residence; (v) the leasing of all or any part of the Property; (vi) any material breach of this Deed of Trust, the Note or the Home Agreement; or (vii) the filing of bankruptcy by the Borrower. The Equity in the Property shall be calculated and shared between the Borrower and the Beneficiary on the following basis: If, for example, 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 Beneficiary 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 (or in the event of a sale of the Property for an amount other than its fair market value or where there is no price established for the Property, the fair market value of the Property determined by an appraiser chosen by the Beneficiary in its sole discretion) and the sum of the following amounts: Rev 10.17.2012 (a) The principal on the First Note and the Deed of Trust (including all principal paid down on the First Note and Deed of Trust), along with any interest and fees due thereon; and (b) The principal on the Note and this Deed of Trust, along with any interest and fees due thereof; and (c) All costs of sale, including costs of brokers' commissions, escrow fees, title costs and fees, recording costs, etc.; and (d) Current year taxes, including at real estate taxes calculated to the date of sale; and Page 4 of 10 Initials CE /6`E. (e) The Borrower's down payment not including the loan from the Beneficiary to Borrower; and (f) (g) All principal paid down on the First Note and Deed of Trust; and The costs of any improvements to the Property, provided such improvements were approved by the Beneficiary prior to construction and provided that such improvements have been documented to the satisfaction of the Beneficiary. The amount of the Borrower's share in the Equity of the Property shall increase by five percent (5°/0) per year, measured on the anniversary of the date this Deed of Trust is recorded against the Property. Correspondingly, the Beneficiary'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 five (5) but less than six (6) years after the date this Deed of Trust is recorded against the Property, the Beneficiary 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 balance of the Note (item 17b above) will be due and payable as provided herein and in the Note. In the event that a negative Equity situation exists, i.e., the proceeds from the sale of the Property are less than the balance of the Note, all net proceeds from the transfer or sale shall be paid to Beneficiary in full satisfaction of the Note. When the HOME recapture requirement is triggered by a sale (voluntary or involuntary) of the housing unit, and there are no net proceeds or the net proceeds are insufficient to repay the home investment due, the participating jurisdiction can only recapture the net proceeds, if any. The net proceeds are the sales price minus superior loan repayment (other than HOME funds) and any closing costs. NON -UNIFORM COVENANTS Borrower and Beneficiary further covenant and agree as follows: 18. Acceleration, Remedies. Upon Borrower's breach of any covenant or agreement of Borrower in this Deed of Trust, including the covenants to pay when due any sums secured by this Deed of Trust, and those contained in paragraph 17 hereof, the Beneficiary, prior to acceleration, shall give notice to Borrower as provided in Paragraph 12 hereof specifying: (a) The breach; (b) The action required to cure such breach; (c) A date, not less than 10 days from the date the notice is mailed to Borrower, by which such breach must be cured; and (d) That failure to cure such breach on or before the date specified in the notice may result in acceleration of the sums secured by this Deed of Trust and sale of the Property. The notice shall further inform Borrower of the right to reinstate after acceleration and the right to bring a court action to assert the nonexistence of a default or any other defense of Borrower to acceleration of sale. If the breach is not cured on or before the date specified in the notice, Beneficiary, at Beneficiary's option, may declare all of the sums secured by this Deed of Trust to be immediately due and payable without further demand and may invoke the power of sale and any other remedies permitted by applicable law. Beneficiary shall be entitled to collect all reasonable costs and expenses incurred in pursuing the remedies provided in this Paragraph 17, including, but not limited to, reasonable attorneys' fees. If Beneficiary invokes power of sale, Beneficiary shall execute or cause Trustee to execute a written notice of the occurrence of an event of default and of Beneficiary's election to cause the Property to be sold and shall cause such notice to be recorded in each county in which the Property or some part thereof is located. Beneficiary or Trustee shall mail copies of such notice in the manner prescribed by applicable law. Trustee shall give public notice of sale to the persons and in the manner prescribed by applicable law. After the lapse of such time as may be required by applicable law, Trustee, without demand on Borrower, shall sell the Property at public auction to the highest bidder at the time and place and under the terms designated in the notice of sale in one or more parcels and in such order as Trustee may determine. Trustee may postpone sale of all or any parcel of the Property by public announcement at the time and place of any previously scheduled sale. Beneficiary or Beneficiary's designee may purchase the Property at any sale. Rev 10.17.2012 Page 5 of 10 Initials C t ACE Trustee shall deliver to the purchaser Trustee's deed conveying the Property so sold without any covenant or warranty, expressed or implied. The recitals in the Trustee's deed shall be prima facie evidence of the truth of the statements made therein. Trustee shall apply the proceeds of the sale in the following order: (a) To all reasonable costs and expenses of the sale, including, but not limited to, reasonable Trustee's and attorneys' fees and costs of title evidence; (b) To all sums secured by this Deed of Trust; and (c) The excess, if any, to the person or persons legally entitled thereto. 19. Borrower's Right to Reinstate. (a) Curable Breach. Notwithstanding Beneficiary's acceleration of the sums secured by this Deed of Trust due to Borrower's breach, Borrower shall have the right to have any proceedings begun by Beneficiary to enforce this Deed of Trust discontinued at any time prior to five days before sale of the Property pursuant to the power of sale contained in this Deed of Trust or at any time prior to entry of a judgment enforcing this Deed of Trust if: (1) Borrower pays Beneficiary all sums, which would be then due under this Deed of Trust, and the Note, had no acceleration occurred; (2) Borrower cures all breaches of any other covenants or agreements of Borrower contained in the Deed of Trust; (3) Borrower pays all reasonable expenses incurred by Beneficiary and Trustee in enforcing the covenants and agreements of Borrower contained in this Deed of Trust, and in enforcing Beneficiary's and Trustee's remedies as provided in Paragraph 18 hereof, including, but not limited to, reasonable attorneys' fees; and (4) Borrower takes such action as Beneficiary may reasonably require to assure that the lien of this Deed of Trust, Beneficiary's interest in the Property and Borrower's obligation to pay the sums secured by this Deed of Trust shall continue unimpaired. Upon such payment and cure by Borrower, this Deed of Trust and the obligations secured hereby shall remain in full force and effect as if no acceleration had occurred. (b) Non -Curable Breach. (1) Failure to Occupy/Renting Out the Property is a Violation of Federal Law. Borrower hereby acknowledges that the loan evidenced by the Note and secured by this Deed of Trust was funded by Beneficiary using U.S. Department of Housing and Urban Development ("HUD") Home Investments Partnership Act ("HOME") funds. Section 215 of the HOME Investment Partnerships Act (42 U.S.C. §12745) and the HOME program regulations (24 C.F.R. §92.254) require Borrower to occupy the Property as Borrower's principal residence. Renting out the Property and/or Borrower's failure to occupy the Property as Borrower's principal residence is a violation of Federal law (in addition to being a violation of the Note, Declaration and this Deed of Trust). Beneficiary is obligated by Federal law to enforce the provisions of the HOME program, Beneficiary's failure to do so would jeopardize the Beneficiary's ability to obtain additional HOME funds from HUD and help other low-income families to obtain affordable housing. (2) Failure to Occupy/Renting Out the Property Materially Impairs Beneficiary's Security. Borrower hereby acknowledges and agrees that renting out the Property and/or Borrower's failure to occupy the Property as Borrower's principal residence, materially impairs the Beneficiary's security for the loan and the Beneficiary's ability to obtain additional HOME funds from HUD and help other low-income families to obtain affordable housing. Borrower further acknowledges that if the Property is rented out and/or Borrower fails to occupy the Property as Borrower's principal residence, then during any such period the Property will not qualify as "affordable housing" and the Beneficiary may be in breach of its obligations to HUD and therefore the Beneficiary's security for the loan will be materially impaired. (3) Failure to Occupy/Renting Out the Property is a Non -Curable Breach. Borrower hereby acknowledges and agrees that renting out the Property and/or Borrower's failure to occupy the Property as Borrower's principal residence, will be a non -curable breach and the Beneficiary shall have the right to accelerate the loan and foreclose on the Property as provided herein. Notwithstanding anything to the contrary set forth in Sections 18 or 19(a) of this Deed of Trust, Borrower agrees that in the event Borrower rents out the Property and/or fails to occupy the Property as Rev 10.17.2012 Page 6 of 10 Initials` bY/ E Borrower's principal residence, Borrower shall not have the right to cure the breach and reinstate the loan, this Deed of Trust or the obligations secured hereby. (4) Borrower's Waiver. Borrower hereby knowingly waives and relinquishes any and all legal and/or contractual rights Borrower may have to cure or otherwise reinstate this Deed of Trust and the obligations secured hereby, in the event that Property is rented out and/or Borrower fails to occupy the Property as Borrower's principal residence. (5) Representation of Comprehension. Borrower acknowledges and agrees that Beneficiary has advised Borrower (and each of them if there is more than one Borrower) to retain an attorney to represent Borrower with respect to the loan secured by this Deed of Trust. By executing this Deed of Trust, Borrower (and each of them if there is more than one Borrower) represents that: (i) Borrower fully understands and accepts the terms of this Deed of Trust, the Note and the Declaration; (ii) Borrower has relied upon the legal advice of Borrower's attorneys or that Borrower has freely and independently chosen not to seek the advice of an attorney; (iii) that neither the Beneficiary nor its attorneys represents Borrower; (iv) that Borrower has had a full and ample opportunity to consult with any other professionals of Borrower's choice in connection with the rights and liabilities created by this Deed of Trust, the Note and the Declaration; (v) that Borrower does not have any questions with regard to the legal import of any term, word, phrase, or portion of this Deed of Trust, the Note and the Declaration, or any of this Deed of Trust, the Note and the Declaration in their entireties; and (vi) Borrower accepts the terms of this Deed of Trust, the Note and the Declaration as written. 20. Assignment of Rents; Appointment of Receiver; Beneficiary in Possession. As additional security hereunder, Borrower hereby assigns to Beneficiary the rents of the Property. Upon any such default, the Beneficiary, in person, by agent or by judicially appointed receiver, shall be entitled to enter upon, take possession of and manage the Property and to collect the rents of the property including those past due. All rents collected by Beneficiary or the receiver shall be applied first to payment of the cost of management of the Property and collection of rents, including, but not limited to, receiver's fees, premiums on receiver's bonds and reasonable attorneys' fees, and then to the sums secured by this Deed of Trust. Beneficiary and the receiver shall be liable to account only for those rents actually received. The entering upon and taking possession of said property and the collection of such rents and the application thereof as aforesaid shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. 21. Reconveyance. Upon payment of all sums secured by this Deed of Trust, Beneficiary shall request Trustee to reconvey the Property and will surrender this Deed of Trust and all Notes evidencing indebtedness secured by this Deed of Trust to Trustee. Trustee shall reconvey the Property without warranty and without charge to the person or persons legally entitled thereto. Such person or persons shall pay all costs of recordation, if any. 22. Substitute Trustee. The Beneficiary, or any successor in ownership of any indebtedness secured hereby, may from time to time appoint a successor trustee to any Trustee appointed hereunder by an instrument executed and acknowledged by Beneficiary and recorded in the office of the Recorder of the county where the Property is located. The instrument shall contain the name of the original Beneficiary, Trustee and Borrower, the book and page where this Instrument is recorded and the name and address of the successor trustee. The successor trustee shall, without conveyance of the Property, succeed to all the title, power and duties conferred upon the Trustee herein and by applicable law. This procedure for substitution of trustee shall govern to the exclusion of all other provisions for substitution. 23. Request for Notices. Borrower requests that copies of the Notice of Default and Notice of Sale be sent to Borrower's address, which is the Property Address. Beneficiary requests that copies of notices of foreclosure from the holder of any lien which has priority over this Deed of Trust be sent to Beneficiary's address, as set forth on Page One of this Deed of Trust as provided by Section 2924b of the Civil Code of California. 24. Fee for Requested Statements. The Beneficiary may charge a fee not to exceed the amount allowed by law for furnishing the statement of obligation as provided in Section 2943 of the Civil Code of California. 25. Covenants, Conditions and Restrictions. The Property is subject to the HOME Agreement between the Beneficiary and the Borrower, that is not attached hereto but is incorporated by reference. Borrower acknowledges receipt of the HOME Agreement and agrees for him/her self/ his/her heirs, successors and assigns to be bound by the same. 27. Warranties of Borrower. Borrower warrants to Beneficiary that: Rev 10.17.2012 (a) Borrower is a first-time homebuyer; that is, s/he has not owned a home, or had any ownership interest in a home within a three-year (3 year) period immediately preceding the date of this Deed of Trust, and Page 7 of 10 Initials CE (b) That Borrowers annual gross income does not exceed eighty percent (80%) of the median income for the San Diego metropolitan area, as adjusted for family size, as said median income is determined by the U.S. Department of Housing and Urban Development (HUD), on the later of: 1. The date of initial application to the Beneficiary; or 2. The date of the recordation of this Deed of Trust. (c) That for so long as Borrower owns the Property, Borrower will reside in the Property as Borrower's principal place of residence. Borrower agrees not to sublet, lease or rent out the Property during the term of this Deed of Trust. 28. Subordination. This Deed of Trust is subordinate to any deed of trust or mortgage on the Property made by or held by an institutional lender or investor that is senior in recording priority to this Deed of Trust, and is likewise subordinate to any mortgage or deed of trust which is given in connection with any refinancing of the loan secured by such senior deed of trust or mortgage, provided the loan amount of such refinancing does not exceed the then outstanding balance (plus refinancing and closing costs) of the existing senior loan. Any party, and its successors and assigns, receiving title to the Property through a trustee's sale, a judicial foreclosure sale or deed in lieu of foreclosure of such deed of trust or mortgage, and any conveyance or transfer thereafter, shall receive title free and dear of the provisions of this Deed of Trust. 29. Funds for Taxes and Insurance. The Beneficiary will waive collection of impounds for taxes and assessments (including condominium, planned unit development and planned residential development assessments, if any). 30. Severability. If any provision of this Deed of Trust is deemed to be invalid or unenforceable by a court of competent jurisdiction, that provision shall be severed from the rest of this Deed of Trust and the remaining provisions shall continue in full force and effect. 31. Riders to this Security Instrument. If one or more riders are executed by Borrower and recorded together with this Security Instrument, the covenants and agreements of each such rider shall be incorporated into and shall amend and supplement the covenants and agreements of this Security Instrument as if the rider(s) were a part of this Security Instrument. [Check applicable box(es)] ❑ Transfer Rider 0 1-4 Family Rider 0 Other(s) [specify]: 0 Condominium Rider 0 PUD Rider BY SIGNING BELOW, Borrowers accepts and agrees to the terms and covenants contained in this Security Instrument and in any rider(s) executed by Borrowers and recorded with it. Ce5a'' Es-cc-fl o S a t tcrr\ t ►^ -F Cfi Cesar Escoto Nile SCoTo A-rroRn9►( ►+a 'F,4d- y hs Rev 10.17.2012 Page 8 of 10 Initials T-la A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. ACKNOWLEDGMENT: State of California County of San Diego On Ma - A, ( f 2011 before me, McA 1a J s a Notary Public, personally appeared %eSc FSC-0to 6 Aiote.Q who proved to me on the basis of satisfactory evidence to be the person{srwhose nameJ.s subscribed to the within instrument, and acknowledged to me thatbetshe/trey executed the same in his`/her/t1etr authorized capacity), and that by bislfier/tljeifsignature,(,a�'on the instrument the persor ; or the entity upon behalf of which the persons acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. z z SEAL Rev 10.17.2012 MATTHEW HOLLAND DAVIS Commission # 2122672 C Notary Public - California i San Diego County My Comm. Expires Aug 8, 2019 WITNESS my hand and official seal. Signature of Notary Page 9 of 10 Initials OE. ` 5 Rev 10.17.2012 Legal Description of Property EXHIBIT A Page 10 of 10 InitialsCE' .dE Fidelity National Title Company Your Reference Number: Order No.: 00087909-007-CW1 EXHIBIT A LEGAL DESCRIPTION THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS: THE SOUTH 46.25 FEET OF THE NORTH 142.50 FEET OF LOTS 348 AND 349 OF LINCOLN ACRES ANNEX UNIT NO. 2, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 1748, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, FEBRUARY 7, 1923. APN: 558-270-21-00 Recorded Requeet Of FIDELITY NATIONAL TITLE SAN DIEGO OFFICE FREE RECORDING REQUESTED PURSUANT TO GOVERNMENT CODE SECTION 27383 WHEN RECORDED PLEASE MAIL TO: San Diego Habitat for Humanity ATTN: KC Clifford 10222 San Diego Mission Road San Diego, CA 92108 ACCOMMODATION FILING DOC# 2017-0123739 1 II IIII III IIIII II IIIIII I III III 111111IIIIIIII IIIIII Mar 17, 2017 02:30 PM OFFICIAL RECORDS Ernest J. Dronenburg, Jr., SAN DIEGO COUNTY RECORDER FEES: $42.00 PAGES: 10 APN: 558-270-21-00 (SPACE ABOVE FOR RECORDER'S USE ONLY) LOAN #03072017-ESCOTO HOMEOWNER'S REGULATORY AGREEMENT FOR HOME PROGRAM PARTICIPATION THIS REGULATORY AGREEMENT ("Regulatory Agreement" or "Agreement") is entered into as of this March 7th 2017 date between the City of National City ("City"), and a Qualifying Household, on behalf of itself and Cesar Escoto, A Married Man as His Sole and Separate Property ("Owner"). PREFACE WHEREAS, the City of National City receives a formula HOME Investment Partnerships ("HOME") Program allocation from the Federal Department of Housing and Urban Development to carry out eligible activities in accordance with program requirements; and WHEREAS, the Owner is interested in participating in City 's HOME -funded First -Time Homebuyer Program, and will comply with all program regulations and requirements; and WHEREAS, concurrently with the recordation of this Regulatory Agreement the City is funding a loan ("Loan") secured by a deed of trust ("Deed of Trust") to aid Owner, who is a first-time homebuyer, in acquiring the Property described below. The Trust Deed and Loan by the City was conditioned in part upon the recordation of a document setting forth certain restric- tions upon the use and sale of the Property; and WHEREAS, Owner will use the proceeds of such Loan for the acquisition of the real property with the street address of 1918 Rachael Avenue, National City, CA 91950 more particularly described in Exhibit A attached and incorporated by this reference ("Property"); and WHEREAS, as further consideration for the Loan and to further the interests of City, the Owner has agreed to enter into and record this Agreement. The covenants in this Agreement are intended to run with the land and be binding on the Owner for the full term of this Agreement. NOW, THEREFORE, THE PARTIES MUTUALLY AGREE AS FOLLOWS; The Owner shall receive HOME Investment Partnership funds for investment in real property owned by the Owner, as evidenced by legal title or a valid contract of sale. Acting in this capacity, the Owner will comply with all aspects of HOME regulations 24 CFR §92.504 including the following: A. DEFINITIONS The following terms have the meanings and content set forth in this Section A where used in this Agreement or attached exhibits. 1. "AREA MEDIAN INCOME" means the median income for the San Diego County Primary Metropolitan Statistical Area (PMSA), with adjustments for household size, as adjusted from time to time by the U.S. Dept. of Housing and Urban Development (HUD). 2. "CITY" is of the City of National City, California, a public body corporate and politic. Page 1 of 7 Owner Initials Acff Recorded Request Of FIDELITY NATIONAL TITLE SAN DIEGO OFFICE FREE RECORDING REQUESTED PURSUANT TO GOVERNMENT CODE SECTION 27383 WHEN RECORDED PLEASE MAIL TO: San Diego Habitat for Humanity ATTN: KC Clifford 10222 San Diego Mission Road San Diego, CA 92108 ACCOMMODATION FILING THIS DOCUMENT HAS BEEN ELECTRTA THE CHED COVER PAGE FOR RECORDING INFORMATION (SPACE ABOVE FOR RECORDER'S USE ONLY) APN: 558-270-21-00 LOAN #03072017-ESCOTO HOMEOWNER'S REGULATORY AGREEMENT FOR HOME PROGRAM PARTICIPATION THIS REGULATORY AGREEMENT ("Regulatory Agreement" or "Agreement") is entered into as of this March 7th 2017 date between the City of National City ("City"), and a Qualifying Household, on behalf of itself and Cesar Escoto, A Married Man as His Sole and Separate Property ("Owner"). PREFACE WHEREAS, the City of National City receives a formula HOME Investment Partnerships ("HOME") Program allocation from the Federal Department of Housing and Urban Development to carry out eligible activities in accordance with program requirements; and WHEREAS, the Owner is interested in participating in City 's HOME -funded First -Time Homebuyer Program, and will comply with all program regulations and requirements; and WHEREAS, concurrently with the recordation of this Regulatory Agreement the City is funding a loan ("Loan") secured by a deed of trust ("Deed of Trust") to aid Owner, who is a first-time homebuyer, in acquiring the Property described below. The Trust Deed and Loan by the City was conditioned in part upon the recordation of a document setting forth certain restric- tions upon the use and sale of the Property; and WHEREAS, Owner will use the proceeds of such Loan for the acquisition of the real property with the street address of 1918 Rachael Avenue, National City, CA 91950 more particularly described in Exhibit A attached and incorporated by this reference ("Property"), and WHEREAS, as further consideration for the Loan and to further the interests of City, the Owner has agreed to enter into and record this Agreement. The covenants in this Agreement are intended to run with the land and be binding on the Owner for the full term of this Agreement. NOW, THEREFORE, THE PARTIES MUTUALLY AGREE AS FOLLOWS., The Owner shall receive HOME Investment Partnership funds for investment in real property owned by the Owner, as evidenced by legal title or a valid contract of sale. Acting in this capacity, the Owner will comply with all aspects of HOME regulations 24 CFR §92.504 including the following: A. DEFINITIONS The following terms have the meanings and content set forth in this Section A where used in this Agreement or attached exhibits. 1. "AREA MEDIAN INCOME" means the median income for the San Diego County Primary Metropolitan Statistical Area (PMSA), with adjustments for household size, as adjusted from time to time by the U.S. Dept. of Housing and Urban Development (HUD). 2. "CITY" is of the City of National City, California, a public body corporate and politic. Page 1 of 7 Owner Initials CI— f E 3. "DEED OF TRUST" means any deed of trust, assignment of rents, and security agreement placed on the Property or any part thereof as security for any Loan and other obligations with Owner as trustor and City as beneficiary, as well as any amendments to, modification of, and restatements of said deed(s) of trust. 4. "EFFECTIVE PERIOD" means the period commencing on the date of this agreement and ending on the repayment of the Loan from the City, including the repayment of any required Equity. 5. "EIGHTY PERCENT OF AREA MEDIAN INCOME" means annual income, which does not exceed eighty percent (80%) of the Area Median Income. 6. "HUD" means the United States Department of Housing and Urban Development. 7. "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. 8. "HOMEOWNER INVESTMENT": homeowner's down payment and any capital improvement investment made by the owner since purchase. 9. "HOUSE" means the residential dwelling unit that is located on the Property. 10. "LOAN" is any Loan of funds provided by the City to any Owner for the purchase of the Property. 11. "LOAN DOCUMENTS" are collectively the Deed of Trust, Note, Note Rider, this Regulatory Agreement and any loan agreement, deed of trust, or promissory note entered into between City and Owner with respect to any of the Property, as they may be amended, modified or restated from time to time, along with all exhibits and attachments to these documents. 12. "NOTE" means the promissory note and note rider executed by Owner in favor of City evidencing any part of a Loan, which is secured by a Deed of Trust, as well as any amendments to, modifications, or restatements of said promissory note. The Note will be on file with the City. 13. "OWNER" or "OWNERS" is the Qualifying Household that is the purchaser of the Property. 14. "PROPERTY" means the real property located at 1918 Rachael Avenue, National City, CA 91950 and described in the attached Exhibit A, which is hereby incorporated into this Agreement by this reference, and any buildings or improvements now or hereafter situated on said real property. 15. "QUALIFYING HOUSEHOLD" means a household whose income is Eighty Percent of Area Median Income, as determined periodically by HUD, with adjustments in accordance with 24 CFR 92.252, and who is otherwise eligible to purchase the Property. 16. "QUALIFYING SALES PRICE" means a sales price that does not exceed 95 percent (95%) of the median purchase price for the area, as determined by the U.S. Department of Housing and Urban Development. B. TERM OF AGREEMENT The term of this Agreement shall remain in full force and effect during the Effective Period regardless of any expiration of the term of any Loan, any payment or prepayment of any Loan, any assignment of a Note, any reconveyance of a Deed of Trust, or any sale, assignment, transfer, or conveyance of the Property, unless terminated earlier by the City in writing or extended by the mutual consent of the parties. However, failure to record this Agreement by the City shall not relieve Owner of any of the obligations specified herein. The covenants in this Agreement will run with the land for the benefit of the City and its heirs, assigns and successors and be binding on Owner and Owner's heirs, assigns and successors for the full term of this Agreement. C. USE OF FUNDS The Loan will be used to acquire the Property by the Owner who is a member of a Qualifying Household. D. AFFORDABILITY 1. The House will qualify as affordable housing and will have: (a) an initial purchase price that is a Qualifying Sales Price; and (b) an estimated appraised value at acquisition that does not exceed Qualifying Sales Price. 2. The House must be the principal residence of the Owner at all times during the Effective Period. Page 2 of 7 tAEOwner Initials 3. The deferred Loan for the HOME -assisted House is $ 89,000.00 (Eighty Nine Thousand Dollars & 00/100). E. RECAPTURE OF HOME FUNDS Pursuant to 24 CFR 92.254(a) (ii), the City requires that HOME funds be recaptured if the housing does not continue to be the principal residence of the family. If there is a "transfer," the principal amount of the Note, together with a share of the "Equity" (if any), as hereafter defined, shall be immediately due and payable to the City. A "transfer" means (i) all or any part of the Property or any interest in the Property that is sold, conveyed or transferred; (ii) Owner is not a natural person and a beneficial interest in Owner is sold, conveyed or transferred; (iii) all or any part of the Property is refinanced, except as otherwise allowed by law; (iv) Owner does not occupy the Property as his, her, or their primary residence; (v) the leasing of all or any part of the Property; (vi) any material breach of the Note, Deed of Trust or this Agreement; or (vii) the filing of bankruptcy by the Owner. The Equity in the Property shall be calculated and shared between the Owner and City on the following basis: # Months After Date of Agreement Buyer's Equity Share (Increases 5% per year) City Equity Share (Decreases 5% per year) 0-12 (50%) (50%) 13-24 (55%) (45%) 25-36 (60%) (40%) 37-48 (65%) (35%) 49-60 (70%) (30%) 61-72 (75%) (25%) 73-84 (80%) (20%) 85-96 (85%) (15%) 97-108 (90%) (10%) 109-120 (95%) (5%) Thereafter (100%) (0%) If, for example, the Property is sold, rented, refinanced, conveyed, or transferred in the first year of the term of the Note secured by this Deed of Trust, Owner 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 (or in the event of a sale of the Property for an amount other than its fair market value or where there is no price established for the Property, the fair market value of the Property determined by an appraiser chosen by the Beneficiary in its sole discretion) and the sum of the following amounts: (a) principal on the First Note and the Deed of Trust, along with any interest and fees due thereon; and (b) principal on the Note and Deed of Trust, along with any interest and fees due thereon; and (c) all costs of sale, including costs of brokers' commissions, escrow fees, title costs and fees, recording costs, etc.; and (d) current year taxes, including all pro-rata real estate taxes calculated to the date of sale; and (e) borrower's down payment not including the Loan from the City to the Owner; and (f) all principal paid down on the First Note and Deed of Trust; and (g) 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 Owner's share in the Equity of the Property shall increase by five percent (5%) per year, measured on the anniversary of the date of the Deed of Trust is recorded against the Property. Correspondingly, the 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 five (5) but less than six (6) years after the date of the Deed of Trust is recorded against the Property, the City would have a twenty five percent (25%) share in the Equity and the Owner would have a seventy five percent (75%) share in the Equity of the Property. Page 3of7 Owner Initials OE-9 r CM In the event that no Equity exists at the time of transfer or sale, the balance of the Note (item E.1.b above) will be due and payable as provided herein. In the event that a negative Equity situation exists, i.e., the proceeds from the sale of the Property are less than the balance of the Note, all net proceeds from the transfer or sale shall be paid to Beneficiary in full satisfaction of the Note. When the HOME recapture requirement is triggered by a sale (voluntary or involuntary) of the housing unit, and there are no net proceeds or the net proceeds are insufficient to repay the home investment due, the participating jurisdiction can only recapture the net proceeds, if any. The net proceeds are the sales price minus superior Loan repayment (other than HOME funds) and any closing costs. F. PROPERTY MAINTENANCE AND SECURITY During the Effective Period, Owner shall at his or her own expense maintain the Property in good condition, in good repair, and in decent, safe, sanitary and habitable living conditions for the benefit of that Owner's household. Owner shall maintain the Property in conformance with all applicable state, federal and local laws, ordinances, codes and regulations. In the event that Owner fails to maintain the Property in accordance with these standards and after at least thirty (30) business days prior notice to Owner, the City or the City's contractor or agent may, but shall be under no obligation to, enter upon the Property, make such repairs or replacements as are deemed necessary in the City's discretion, and provide for payment thereof. Any amount advanced by the City to make such repairs, together with interest thereon from the date of such advance at the rate of seven percent (7%) per annum (unless payment of such an interest rate would be contrary to applicable law, in which event such sums shall bear interest at the highest rate then allowable by applicable law), shall become an additional obligation of the Owner to the City and shall be secured by any Deed of Trust, if not previously reconveyed. G. REPAYMENTS HOME Funds that are loaned to the Owner are to be remitted (principal and interest, as warranted) to the City to be retained and used as program income to originate additional Loans to First -Time Homebuyers or used toward other HOME -eligible activities. H. PROPERTY REQUIREMENTS Compliance with the following requirements is required as follows: 1. Maximum per -unit subsidy amount. The amount of HOME funds that a participating jurisdiction may invest on a per -unit basis in affordable housing will not exceed the per -unit dollar limits established by HUD. 2. Property Standards. Housing that is assisted with HOME funds, at a minimum, must meet Section 8 Housing Quality Standards. 3. Property Cost Limits. The value of acquisition and development of the housing unit, located in the City of National City must not exceed 95 percent (95%) of the median price for the area, as determined by the U.S. Department of Housing and Urban Development. 4. Occupancy Requirements. The HOME Program requires that occupancy standards must be maintained for the Effective Period for each of the assisted Houses as follows: (a) The prospective purchaser must be low income; that is, the purchaser must have an annual (gross) income that does not exceed Eighty Percent (80%) of Area Median Income, which will be determined at either the time the household initially occupies the property or at the time the HOME funds are invested; whichever is later. (b) Each Owner must occupy the property as a principal residence. Only Loan default and subsequent foreclosure negates the principal residence limitation. 5. Ownership Interest. The Owner must have fee simple title or cooperative ownership interest upon the purchase of the HOME -assisted unit. 6. Refinance. The City will subordinate to the following refinance situations only, subject to City approval and additional documentation required: (a) FHA streamline refinance, with a reduction in total PITI and no cash out. (b) VA rate reduction refinance, with a reduction in total PITI and no cash out. (c) Conventional rate and term refinance, with a reduction in total PITI and no cash out. Page 4 of 7 Owner Initials CE T REVERSION OF ASSETS. Owner must transfer to the City any HOME funds remaining in the Property after the time of expiration of the Effective Period when there is a change to title on the Property or any sale, rental, refinance, conveyance or transfer of Property. Any funds received as a result of this reversion of assets shall be used for. additional HOME -eligible activities. J. DEFAULTS AND REMEDIES. In the event of any breach or violation of any agreement or obligation under this Agreement, the City may proceed with any or all of the remedies as described in paragraph 18 of the Deed of Trust. K. NON -LIABILITY OF OFFICIALS, EMPLOYEES AND AGENTS. No officer, official, director, employee, agent or representative of the City shall be personally liable to Owner for any obligation created under the terms of this Agreement except in the case of actual fraud or willful misconduct by such person. L. INDEMNITY. Notwithstanding the insurance coverage required herein, Owner shall indemnify and hold City and its officers, officials, directors, employees, agents and authorized representatives (each, an "Indemnified Party," and collectively, "Indemnified Parties"), free and harmless against any losses, damages, liabilities, claims, demands, judgments, actions, court costs, and legal or other expenses (including attorney's fees) which any Indemnified Party may incur as a direct or indirect consequence of (1) Owner's failure to perform any obligations as and when required by this Agreement; (2) any failure of any of Owner's representations or warranties to be true and complete; or (3) any act or omission by Owner or any contractor, subcontractor, management agent, or supplier with respect to the Property, except where such losses are caused by the sole negligence or willful misconduct of Indemnified Parties. Owner shall pay immediately upon the City's demand any amounts owing under this indemnity. The duty of the Owner to indemnify includes the duty to defend Indemnified Parties in any court action, administrative action, or other proceeding brought by any third party arising from the Property. Owner's duty to indemnify Indemnified Parties shall survive the term of this Agreement. M. SUBORDINATION. This Agreement shall be subordinated in priority only to the liens and encumbrances approved in writing by the City in its sole and absolute discretion. N. GENERAL PROVISIONS 1. Governing Law. This Agreement shall be interpreted under and be governed by the laws of the State of California, except for those provisions relating to choice of law and those provisions preempted by federal law. This Agreement Controls. In the event that any provisions of this Agreement and any Loan Documents conflict, the terms of this Agreement shall control. Time. Time is of the essence in this Agreement. Consents and Approvals. For those provisions of this agreement which are expressly subject to consent or approval of the City, said consent or approval shall not be unreasonably withheld. Any approval must be in writing and executed by an authorized representative of the City. Notices, Demands and Communications. Formal notices, demands and communications between Owner and the City shall be sufficiently given and shall not be deemed given unless dispatched by mailing it first class mail or by certified mail, return receipt requested, to the principal offices of Owner and City as follows: City of National City Attn: Housing Programs 1243 National City Boulevard National City, CA 91950-4397 New Owner: Cesar Escoto Address: 1918 Rachael Avenue, National City, CA 91950 Page 5 of 7 Owner Initials Ct c t Any such written communications by mail shall be conclusively deemed to have been received by the addressee five days after the deposit thereof in the United States Mail, postage prepaid and properly addressed as noted above. 6. Severability. Every provision of this Agreement is intended to be severable. If any provision of this Agreement shall be held invalid, illegal, 'or unenforceable by a court of competent jurisdiction, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired. 7. Attorney's Fees. In the event of any litigation over the performance of this Agreement, the prevailing party shall be entitled to attorney's fees and costs incurred during the course of litigation. IN WITNESS HEREOF, the City and the Owner have executed this Agreement as of the date first hereinafter set forth. City of National City Bv: Leslie Deese City Manager OWNER: Cesar CSC ° by SOk s ecs \� c 0 ( / Cesar/Esc ,15•( At DfE 1ES6.0To,q s u 0.W1ei IN FACT Page 6 of 7 Owner Initials CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT CIVIL CODE § 1189 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of ip On M 20 ti `(before me, Date personally appeared 4 re-\ J t)4'110•314A-A--1 abil°0J 1\1 4-ArLt; c Here Insert Name and Title of the Officer ` A£s� es- Namefs)'of Signerfsr who proved to me on the basis of satisfactory evidence to be the person(erwhose name(,sj- is/are subscribed to the within instrument and acknowledged to me that 14cris-he/t9 executed the same in 13i6her/thei(authorized capacity and that by bieffier4crif signatur8on the instrument the persons); or the entity upon behalf of which the person(acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. MATTHEW HOLLAND DAVIS ;:e. Commission # 2122672 ,r Notary Public - California I"Z% San Diego County My Comm. Expires Aug 8, 2019 C Place Notary Seal Above WITNESS my hand and official seal. Signature of Notary Public OPTIONAL Though this section is optional, completing this information can deter alteration of the document or fraudulent reattachment of this form to an unintended document. Description of Attached Doc ent Title or Type of Document: t LZ Q Qt'LI\'Document Date: Ho ` , 1 ..-O 1.'7 Number of Pages: '•? Signer(s) Other Than Named Above: Capacity(ies) Claimed by Signer(s) Signer's Name: ❑ Corporate Officer — Title(s): ❑ Partner — ❑ Limited ❑ General ❑ Individual ❑ Attorney in Fact ❑ Trustee ❑ Guardian or Conservator ❑ Other: Signer Is Representing: Signer's Name: ❑ Corporate Officer — Title(s): ❑ Partner — ❑ Limited ❑ General ❑ Individual ❑ Attorney in Fact ❑ Trustee ❑ Guardian or Conservator ❑ Other: Signer Is Representing: ©2014 National Notary Association • www.NationalNotary.org • 1-800-US NOTARY (1-800-876-6827) Item #5907 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document, to which this certificate is attached, and not the truthfulness, accuracy, or validity of the document. State of California County of San Diego On i/lou " 1`{ I2-01-1 ,'.before me, Angelita Palma, Notary Public, personally appeared L,st -< D, cs-tom who proved to me on the basis of satisfactory evidence to be the personas') whose name(%) is/arOsubscribed to the within instrument and acknowledged to me that hp'/she/thgy executed the same in h/her/thir authorized capacity(i ), and that by hher/tf'eir signature on the instrument the personV), or the entity upon behalf of hich the person ) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and officialsq . Signature: Angelita PIr Notary Public ANGELITA PALMA .41 COMM. # 2046693 NOTARY PUBLIC • CALIFORNIA SAN DIEGO COUNTY Commssion Expires OCTOBER 25, 2017 APN: 558-270-21-00 Legal Description EXHIBIT A Page 7 of 7 LOAN # 03072017-ESCOTO Owner Initials C t Fidelity National Title Company Your Reference Number: Order No.. 00087909-007-CW1 EXHIBIT A LEGAL DESCRIPTION THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS: THE SOUTH 46.25 FEET OF THE NORTH 142.50 FEET OF LOTS 348 AND 349 OF LINCOLN ACRES ANNEX UNIT NO. 2, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 1748, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, FEBRUARY 7, 1923. APN: 558-270-21-00 DATE: TO: FROM: NioloNAL fair �- INCORPORATED The City of National City MEMORANDUM April 24, 2017 City Clerk's Office Angelita Palma, ommunity Development Specialist II Housing & Economic Development Department SUBJECT: HOME Program Habitat for Humanity Deed of Trust and Homeowner's Regulatory Agreement for HOME Program Participation Loan # 03072017- ESCOTO Please keep the attached HOME Program Habitat for Humanity recorded original Deed of Trust and Homeowner's Regulatory Agreement for HOME Program Participation on file for Loan # 03072017- ESCOTO for CESAR ESCOTO at 1918 RACHAEL AVENUE in National City. Thank you. 1243 National City Blvd; National City, California 91950