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HomeMy WebLinkAbout2018 CON CDC HA (SUBORDINATION AGREEMENT) Raul and Claudia Meza - 1832 E. AvenueNOTE TO FILE 07-30-2019 IN THE MATTER OF: The 2018 CDC -HA Subordination Agreement for Raul and Claudia Meza at 1832 E. Avenue. Please note the following: NO FULLY EXECUTED ORIGINAL AGREEMENT WAS FILED WITH THE OFFICE OF THE CITY CLERK. ORIGINATING DEPARTMENT: NTF CDC X Housing & Economic Development City Attorney Human Resources City Manager MIS Community Svcs. Planning ENG/PW Police Finance Fire CITY OF NATIONAL CITY, CALIFORNIA COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY COUNCIL AGENDA STATEMENT EETING DATE: April 17, 2010 AGENDA ITEM NO. 25 ITEM TITLE: Resolution of the Community Development Commission -Housing Authority (CDC -HA) of the City of National City authorizing the Chairman to execute a Subordination Agreement allowing a new mortgage that is not -to -exceed $97,000 to be and remain a lien prior and superior to a home purchase assistance loan on a single -unit property located at 1832 E Avenue in National City. PREPARED BY: Angelita Palma, Acting Comm. Dev. Manager PHONE: (619) 336-4219 EXPLANATION: On March 11, 2002, the Community Development Commission of the City of National City ("CDC") made a loan for $18,300 from the CDC's First -Time Homebuyer Program to assist in the purchase of a single family home located at 1832 E Avenue in National City. The City loan is deferred for thirty years and charged 3% simple interest which was forgiven after the tenth year of occupancy. Raul Meza and Claudia Meza ("Borrowers") are interested in refinancing the first mortgage loan on the property and have been approved for a new loan from Wells Fargo Bank, N.A. ("Lender"). The Lender is requiring that the CDC -HA execute the attached subordination agreement allowing the new loan to hold superior position to the CDC -issued loan. The CDC loan will maintain second lien Position on the property. The purpose of the refinance is to reduce the interest rate paid to a fixed rate f 4.375% and there will be no cash proceeds to the Borrowers through the refinance. Staff has satisfactorily reviewed the combined loan -to -value, preliminary title report, new loan terms, and good faith estimate that outline the closing costs of the transaction. DEPARTMENT: Housing & _conomic APPROVED BY FINANCIAL STATEMENT: ACCOUNT NO. n/a ENVIRONMENTAL REVIEW: n/a ORDINANCE: INTRODUCTION: FINAL ADOPTION: APPROVED: APPROVED: Finance MIS STAFF RECOMMENDATION: Adopt the Resolution. BOARD / COMMISSION RECOMMENDATION: in/al ,TTACHMENTS: 1. Subordination Agreement Resolahe,t, Na• ;o171-64 tfA RECORDING REQUESTED BY FIRST AMERICAN TITLE COMPANY AND WHEN RECORDED MAIL TO: CITY OF NATIONAL CITY 1243 NATIONAL CITY BLVD NATIONAL CITY, CA 91950 ATTN: HOUSING & ECONOMIC DEV ORDER NO.: 1555487 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 THAN THE LIEN OF SOME OTHER OR LATER SECURITY INSTRUMENT. THIS AGREEMENT, made this 17th day of April 2018 by Raul Meza and Claudia Meza, owner of the land hereinafter described and hereinafter referred to as "Owners", and the Community Development Commission -Housing Authority of the City of National City, a public body, corporate and politic as present owner and holder of the deed of trust and note first hereinafter described and hereinafter referred to as "Beneficiary". WITNESSETH THAT WHEREAS, Owners has executed a deed of trust, dated March 18, 2002, to the Community Development Commission - Housing Authority of the City of National City as trustee, covering the Real property in the City of National City, County of San Diego, State of California, described as follows: SEE ATTACHED LEGAL DESCRIPTION. to secure a note in the sum of $18300, dated March 11, 2002, in favor of The Community Development Commission -Housing Authority of the City of National City, a public body, corporation and politic, which deed of trust was recorded March 18, 2002 Recording Number 2002-0224160 Official Records of said county; and WHEREAS, Owners has executed, or is about to execute, a deed of trust and note in the sum not to exceed $97,000 dated 2018, in favor of Wells Fargo Bank, N.A., hereinafter referred to as "Lender", payable with interest and upon the terms and conditions described therein, which deed of trust is to be recorded concurrently herewith; 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 or Lender; and 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 first 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 Page 1 of 4 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 provide for the subordination of the lien or charge thereof to another deed or deeds of trust or to another mortgage or mortgages. Beneficiary declares, agrees and acknowledges that (a) He/She 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/She 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 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 the 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 OF WHICH MAY BE EXPENDED FOR OTHER PURPOSES THAN IMPROVEMENT OF THE LAND. Community Development Commission — Housing Authority of the City of National City Raul Meza By: Ron Morrison, Chairman Claudia Meza Beneficiary Owner (All signatures must be acknowledged) IT IS RECOMMENDED THAT, PRIOR TO THE EXECUTION OF THIS SUBORDINATION AGREEMENT, THE PARTIES CONSULT WITH THEIR ATTORNEYS WITH RESPECT THERETO. Page 2 of 4 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 SAN DIEGO } SS: On before me, Angelita Palma,a Notary Public, personally appeared Ron Morrison who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies) and that by his/her/their signature(s)on the instrument the person(s), or the entity upon behalf of which the person(s) 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 official seal. Signature FOR NOTARY SEAL OR STAMP 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 } SS: On before me, a Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies) and that by his/her/their signature(s)on the instrument the person(s), or the entity upon behalf of which the person(s) 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 official seal. Signature FOR NOTARY SEAL OR STAMP Page 3 of 4 LEGAL DESCRIPTION Real property in the City of National City, County of San Diego, State of California, described as follows: LOT 13 AND THE SOUTH 15 FEET OF LOT 14, BLOCK 1 OF SUBDIVISION BY W.S. BULLIS, MAY 21, 1881 OF TEN ACRE LOT 14 OF QUARTER SECTION 153 OF RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA ACCORDING TO MAP THEREOF NO. 201, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY ON MAY 27, 1881. ALSO THE SOUTHWESTERLY 10 FEET OF "E" AVENUE ADJOINING THE ABOVE DESCRIBED PROPERTY ON THE NORTHEAST, AS CLOSED JULY 20, 1915, BY RESOLUTION NO. 477 OF THE BOARD OF TRUSTEES OF THE CITY OF NATIONAL CITY. APN: 560-231-11-00 Page 4 of 4 RESOLUTION NO. 2018 — 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 $97,000 TO BE AND REMAIN A LIEN PRIOR AND SUPERIOR TO A COMMUNITY DEVELOPMENT COMMISSION FIRST-TIME HOMEBUYER PROGRAM LOAN ON A SINGLE-FAMILY RESIDENCE LOCATED AT 1832 "E" AVENUE IN NATIONAL CITY WHEREAS, Raul Meza and Claudia Meza (the "Borrowers") are the owners of a single-family residence located at 1832 "E" Avenue in National City; and WHEREAS, on March 11, 2002, the Community Development Commission (CDC) of the City of National City made a loan for $18,300 from the CDC's First -Time Homebuyer Program to assist in the purchase of a single-family residence; and WHEREAS, the Borrowers desire to refinance the existing first mortgage to reduce the interest rate to 4.375% for a term of 30 years with a new mortgage with a principal amount not -to -exceed $97,000 from Wells Fargo Bank, N.A. ("Lender"); and WHEREAS, in order to provide the loan, the Lender requires the subordination of the Deed of Trust that secures the CDC funds. 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 and any other Escrow related documents as necessary. After being recorded by the County of San Diego, the Subordination Agreement will be on file in the office of the City Clerk. PASSED and ADOPTED this 17th day of April, 2017. Ron Morrison, Chairman ATTEST: Leslie Deese, Secretary APPROVED AS TO FORM: Angil P. Morris City Attorney RESOLUTION NO. 2018 — 64 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 $97,000 TO BE AND REMAIN A LIEN PRIOR AND SUPERIOR TO A COMMUNITY DEVELOPMENT COMMISSION FIRST-TIME HOMEBUYER PROGRAM LOAN ON A SINGLE-FAMILY RESIDENCE LOCATED AT 1832 "E" AVENUE IN NATIONAL CITY WHEREAS, Raul Meza and Claudia Meza (the "Borrowers") are the owners of a single-family residence located at 1832 "E" Avenue in National City; and WHEREAS, on March 11, 2002, the Community Development Commission (CDC) of the City of National City made a loan for $18,300 from the CDC's First -Time Homebuyer Program to assist in the purchase of a single-family residence; and WHEREAS, the Borrowers desire to refinance the existing first mortgage to reduce the interest rate to 4.375% for a term of 30 years with a new mortgage with a principal amount not -to -exceed $97,000 from Wells Fargo Bank, N.A. ("Lender"); and WHEREAS, in order to provide the loan, the Lender requires the subordination of the Deed of Trust that secures the CDC funds. 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 and any other Escrow related documents as necessary. After being recorded by the County of San Diego, the Subordination Agreement will be on file in the office of the City Clerk. PASSED and ADOPTED this 17th day of April, 2017 Morrison, Chairman ATTEST: Leslie Deese, Secretary APPROVED AS 0 FORM: orris C. A ttorney Passed and adopted by the Community Development Commission -Housing Authority of the City of National City, California, on April 17, 2018 by the following vote, to -wit: Ayes: Commissioners Mendivil, Morrison, Rios, Sotelo-Solis. Nays: None. Absent: Cano. 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. 2018-64 of the Community Development Commission -Housing Authority of the City of National City, California, passed and adopted on April 17, 2018. Secretary, Housing Authority By: Deputy