HomeMy WebLinkAboutResolution 95-71 10/16/1995 (2)
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A IT ACHMENT 2
RESOLUTION NO., 95-72
A RESOLUTION ADOPTING THE PROPOSED POLICY AND AMENDMENTS TO THE
SPRINGFIELD HOME OWNERSHIP PROGRAM
WHEREAS, the City of Springfield has determined that it is desirable to continue to
administer the Springfield Home Ownership Program (SHOP) for the benefit of its
citizens; and
WHEREAS, the City of Springfield has determined that it is desirable to fund the
Springfield Home Ownership Program through the HOME Investment Partnerships
Program; and
WHEREAS, the City of Springfield has determined that it is necessary to amend the
current Springfield Home Ownership Program Policies to reflect the contemporary
housing needs of the City; and
WHEREAS, the City of Springfield posseses the authority to make such change and
the proposed change does not conflict with Federal regulations governing the funding
of either the Springfield Home Ownership Program or the HOME Investment
Partnerships Program;
NOW, THEREFORE, BE IT RESOLVED AS FOLLOWS BY THE COMMON COUNCIL
OF THE CITY OF SPRINGFIELD:
The Springfield Home Ownership Program Policies as set forth in Attachment 1 are
hereby adopted,
ADOPTED by the Common Council of the City of Springfield by a vote of 4 in
favor and 0 opposed this 16th day of October , 1995.
ft#?J/MmJl-
illiam Morrisette, Mayor
ATTEST:
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Eileen Stein, Ci y Recorder
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OFF!CL~ Of CiTY ATTORNEY
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ATTACHMENT 1
SPRINGFIELD HOME OWNERSHIP PROGRAM POLICIES
(First-time Home Buyer Assistance Program: Adopted 7/6/92, Amended 10/16/95)
PURPOSE
To encourage home ownership by assisting low and very low income Springfield
residents with the first time purchase of a dwelling, The maximum amount of
assistance provided by this program is four thousand dollars ($4,000) per houshold.
1. APPLICANT QUALIFICATIONS
a.
The applicant must be a current resident of the City of Springfield, and must have
resided in Springfield for a period of not less than 1 year prior to the date of application
for SHOP assistance. Applicants who are returning from a military tour of duty, Peace
Corps, VISTA or Americorp Service and who were residents of Springfielq for a
minimum of 1 year prior to their tour of duty or service meet this qualification.
The applicant must be a first time home buyer, First time home buyer means an
individual or an individual and his or her spouse who have not owned a home during
the 3 year period before the purchase of a home with assistance under this program;
except that:
(i) An individual who is a displaced homemaker may not be excluded from
consideration as a first time home buyer on the basis that the individual, while a
homemaker, owned a home with his or her spouse or resided in a home owned
by the spouse. Displaced homemaker means an individual who (1) is an adult,
(2) has not worked full-time in the labor force for a number of years but has,
during such .years, worked primarily without remuneration to care for the home
and family and (3) is unemployed or underemployed and is experiencing
difficulty in obtaining or upgrading employment.
(ii) An individual who is a single parent may not be excluded from consideration as
a first time home buyer on the basis that the individual, while married, owned a
home with his or her spouse or resided in a home owned by the spouse.
(iii) An individual who is a victim of domestic violence or spousal abuse may not be
excludep from consideration as a first time home buyer on the basis that the
individual, while married, owned a home with his or her spouse or resided in a
home owned by the spouse.
The household income of the applicant cannot exceed 80 percent of the median
income for the area, as determined by HUD, with adjustments for smaller and larger
families,
The applicant must qualify for, and be approved for, a home loan by an approved
lending institution, The City will maintain a current list of approved lending institutions,
The applicant must have successfully completed a home ownership preparation
program approved by the City, The program shall include:
(i) Counseling before purchase of the property.
(ii) Assisting first-time home buyers in learning how to identify the most suitable and
affordable properties. ,
(iii) Providing home buyers with financial management assistance,
(iv) Assisting home buyers in understanding mortgage transactions and home sales
contracts;
b,
c,
d,
e.
Springfield Home Ownership Program Policies, page 1 of 4
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(v)
Assisting home buyers with eliminating any credit problems that may prevent the
home buyer from purchasing the property. (NOTE: The current program
developed by the Oregon Bankers Association will satisfy this requirement.)
2. PROPERTY QUALIFICATIONS
a.
The dwelling must be a single family unit within the corporate limits of the City of
Springfield, The dwelling may be either a conventional (Le, site built) structure or a
manufactured home, however in either case it must include the land upon which the
dwelling is situated,
The dwelling, during the period the property is offered for sale and at the time of sale,
shall be occupied by either the seller or the buyer, or shall be vacant. In no case may
the dwelling be occupied by a tenant who would be displaced by the sale.
The dwelling must, at a minimum, meet the housing quality standards of HUD and the
City of Springfield Housing Code, Additionally the dwelling (including land) must be
consistent the Development Code and the adopted comprehensive plan requirements
of the City of Springfield.
The dwelling must have an initial purchase price which does not exceed 95% of the
median purchase price for the type of single-family housing for the jurisdiction as
determined by HUD.
The dwelling must have an estimated appraised value at acquisition, if standard, or
after any repair needed to meet property standards or requirements imposed by the
lender, that does not exceed the mortgage limits described in (d) above.
The dwelling is to be the principal residence of the applicant whose family qualifies as a
low-income family at the time of purchase,
The dwelling and appurtenant real property shall comply with the Flood Disaster Act of
1973 and the National Environmental Policy Act of 1969 and other provisions of law
which further such Act.
A manufactured housing unit qualifies as affordable housing only if the unit:
(i) Is situated on a permanent foundation. !
(ii) Is connected to permanent utility hook-ups,
(iii) Is located on land that is held in fee-simple title, land trust, or long-term ground
lease with a term of not less than 25 years.
(iv) Was constructed after June 15, 1976, and meets construction standards
established under S24 CFR 3280.
Any offer to purchase made by or on behalf of the buyer must be accomp'anied by the
"SHOP Addendum to Sales Agreement and Receipt For Earnest Money", Seller's
acceptance of an offer to purchase must include acceptance of the terms and
conditions of the SHOP Addendum,
b.
c.
d.
e.
f.
g.
h.
i.
3. . CONDITIONS
a,
The Springfield Home Ownership Program will assist successful applicants by providing
funds which can be used for the following purposes:
(i) Down payment assistance.
(ii) Payment of escrow, title and recording fees and other closing costs.
(iii) Payment of points to the lender for the purpose of "buying down" the interest
rate of the loan.
(iv) To establish reserves as required by the lender. .
Use of SHOP funds for purposes other than those described in 3(a)(i-iv) above, without
the express written approval of the City is prohibited,
b.
Springfield Home Ownership Program Policies, page 2 of 4
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c,
To receive SHOP assistance, the home buyer shall have paid a qualified down
payment' of not less than one thousand, five hundred dollars ($1,500) towards the
purchase of the property. Funds for a qualified down payment must be from an
approved source as determined by the lender.
The maximum assistance provided by this program is four thousand dollars ($4,000)
per household,
The assistance shall be in the form of an interest-free loan, subordinate only to the
primary mortgage, Under no circumstance shall this loan be recorded in a position
lesser than second. Repayment of the loan shall be deferred until sale or transfer of
the property. Sale or transfer of the property shall include:
(I) The actual or attempted sale by contract, assignment, lease, rental or other
conveyance of the property to a person other than the Borrower, whether by gift
or for value.
(ii) Any further voluntary or involuntary encumbrance of the property by the
Borrower, but does not include an encumbrance by a governmental agency in
the form of an assessment for streets, sidewalks, lighting or sewer, so long as
the Borrower pays such assessments when due,
(iii) Transfer of the property by will or inheritance upon the death of the last
surviving Borrower under the Promissory Note and Mortgage, but does not
include the transfer of the property to the surviving Borrower upon the death of
one Borrower,
Ownership of the purchased dwelling shall be in fee simple title, except as allowed in
(2)(h)(iii). The ownership interest may be subject only to mortgages, deeds of trust or
other liens or instruments securing debt on the property as approved by the City; or
other restrictions or encumbrances that do not impair the good and marketable nature
of title to the ownership interest.
d,
e.
f.
4. PROCEDURES
a.
Application for assistance shall be made by the lender on behalf of the buyer. The
application packet shall be complete and include all necessary documentation as
indicated on the application form, An application packet determined to be incomplete
or incorrect will be returned to the lender.
Funds will be reserved on a "first come first served" basis, based on the date of receipt
by the City of the complete and correct application packet.
A detailed appraisal of the property shall be submitted to the City along with the
application. The appraisal shall reflect nationally recognized appraisal standards, and
be conducted by a state licensed appraiser, The City shall review the appraisal. Any
concerns raised by the City regarding the appraisal must be addressed by the
appraiser to the City's satisfaction prior to approval of the application.
The City will conduct an inspection of the subject property to ensure that it meets
minimum housing quality standards established by the City and HUD, Any deficiencies
identified during the inspection by the City must be corrected and subsequently
reinspected prior to approval of the application,
Upon approval of the application, the City shall cause the assistance funds to be
placed in an escrow account established for the sale of the subject property. In the
event the sale is not concluded according to the terms of the escrow, the full amount of
the assistance funds will returned to the City,
b.
c.
d.
e.
Springfield Home Ownership Program Policies, page 3 of 4
5. LENDER QUALIFICATIONS
In order to participate in the Springfield Home Ownership Program, a lender must be:
(i) A "Commercial bank" as defined in ORS 706,005, or
(ii) A "Federal association" as defined in ORS 722.004, or
(iii) A "Savings association" as defined in ORS 722.004, or
(vi) A subsidiary of one of the above.
In addition, a lender must administer and actively participate in a home ownership
preparation program, either individually or in partnership with other qualified lenders,
which has been approved by the City, and which shall include all required components
described in section 1,e. .
Springfield Home Ownership Program Policies, Page 4 of 4