HomeMy WebLinkAboutD-1791 2975 Rockview Drive #19 - San Luis Obispo, CA Recorded 09/05/2008RECORDNG REQUESTED BY:
FIRST AMERICA_ E CONIPA-N -Y
4009- '7707 5 7-7
WHEN RECORDED MAIL TO:
City of San Luis Obispo
990 Palm Street
San Luis Obispo, CA 93401
APN 004- 582 -008
JULIE ROE
San Luis Obis
Recorded at the n
First America
County= Clerk/Recorder
est of
Title Company
Doc #: 2008045295
CITY OF SAN LUIS OBISPO
AFFORDABILITY /RECAPTURE AGREEMENT
AND OPTION TO PURCHASE
AB
9/05/2008
8:00 AM
Titles: 2
Pages: 13
Fees
0.00
Taxes
0.00
Others
0.00
PAID
$0.00
THIS COVENANT AND AGREEMENT made and entered into this day of
July 9, 2008, by and between the CITY OF SAN LUIS OBISPO (the "City" or "Lender ")
and Matthew and Beth Lodge ( "Owner ").
RECITALS
A. The City has loaned to Owner Affordable Housing Funds for purchase of
that certain real property located at 2975 Rockview Drive #19, in the City of San Luis
Obispo, as described in Exhibit A attached hereto and incorporated herein as the
"Property."
B. Owner intends to purchase the Property for the purpose of establishing
Owner's principal residence on the Property.
C. The City and Owner desire to assure this housing meets the definition set
forth in the California Health and Safety Code Section 50079.5 (Lower Income) and
remains affordable for a period of forty -five (45) years.
D. To protect the investment of public funds and to provide for continued
homeownership opportunities for Eligible Households, this Agreement provides for
recovery of the City's investment, and reserves for the City an Option to Purchase to be
exercised by the City, its assignee, or another entity as may be designated by the City.
E. The Owner has qualified for assistance to purchase the Property with the
Owner's combined household income at or below eighty percent (80 %) of the Area
Median Income, adjusted for actual household size (a "Lower Income Household ").
F. In addition to this Agreement, to protect the investment of public funds and
FTHB — Affordability /Recapture Agreement, June 2008 - Page 1 of 11
Jqq!
to further the goal of providing housing for Lower Income Households, the Owner is
required to execute a promissory note (the "Note ") in favor of the City.
G. This Agreement and the Note shall be secured by a deed of trust in a
second lien position (the "City Deed of Trust ") subordinate to the lien of that certain
deed of trust (the "First Lender's Deed of Trust ") executed by the owner in favor of The
Mortgage House as beneficiary (the "First Lender"), securing a loan made by the First
Lender to the Owner (the "First Lender's Loan "). For purposes of these documents the
First Lender shall be deemed to also include the California Housing Finance Agency, its
successors and assigns (CaIHFA), hereinafter collectively referred to as First Lender.
NOW THEREFORE, the City and Owner acknowledge and agree as follows:
DEFINITIONS
1.01. "Persons and families of low income" means persons and families whose
income does not exceed eighty percent (80 %) of area median income adjusted for
family size by the United States Department of Housing and Urban Development
( "HUD ").
1.02. Persons and families meeting the definitions under Section 1.01 shall be
referred to as "Eligible Households."
1.03. "Area Median Income" shall refer to the annual median income adjusted
for household size, in the San Luis Obispo - Atascadero - Paso Robles Primary
Metropolitan Statistical Area as published by HUD, or, in the event such income
determination is no longer published by HUD, or has not been updated for a period of at
least 18 months, the City may use or develop such other reasonable method as it may
choose in order to determine the median yearly income in San Luis Obispo City.
2. TERM OF THE AGREEMENT
These affordability requirements shall be covenants running with the land as defined in
California Civil Code Section 1460. Pursuant to Civil Code Section 1468 which governs
such covenants, the provisions of this Agreement shall be binding upon all parties
having any right, title, or interest in any of the properties described herein, or any portion
thereof and on their heirs, successors in interest and assigns for a period of forty -five
(45) years from the date of recordation of this Agreement. The City and Owner agree
that all future deeds or transfers of interest regarding the subject Property shall show
the restrictions of this Agreement for as long as the Agreement is in effect. The Owner,
by and for himself or herself and any successors in interest, covenants and agrees that
for the period of time specified in this Agreement there shall be no sale, lease, rental or
other transfer of the Property except after written notice thereof given to the City at least
sixty (60) days prior thereto, which notice shall specify the terms and conditions of the
proposed transfer, the identity of the proposed transferee and whether such proposed
transferee is an Eligible Household. ANY SALE, LEASE, RENTAL OR OTHER
FTHB — Affordability /Recapture Agreement, June 2008 - Page 2 of 11
• •
TRANSFER OF THE PREMISES IN VIOLATION OF THIS COVENANT SHALL BE
VOID.
3. OWNER CERTIFICATIONS
The Owner certifies that (a) the financial and other information previously provided in
order to qualify to purchase the Property is true and correct as of the date first written
above; (b) the Owner does not own any other residential property as of the date of this
Agreement; and (c) the Owner or Members of the Owner's Immediate Family shall
occupy the Property as their principal place of residence. Members of the Owner's
Immediate Family shall include the Owner's spouse, parents, parents -in -law and
children, provided such Members of the Owner's Immediate Family meet the definition
of a Low Income Household pursuant to this Agreement. The Owner shall be
considered occupying the Property if the Owner is living in the unit for at least ten (10)
months out of each calendar year. The City may grant a temporary waiver of this
occupancy requirement for good cause in its sole discretion.
The Owner shall annually, on the anniversary of the date of the execution of this
Agreement, certify in writing to the City, on a form supplied by the City, that:
(i) the Owner occupies the Property as the Owner's principal place of residence; and
(ii) the Property is in good repair.
4. LEASING AND USE OF PROPERTY
The Owner shall not lease or rent the Property. Any lease or rental in violation of this
Agreement is prohibited, and shall constitute a default by the Owner hereunder.
5. SALE RESTRICTIONS
Any Transfer of the Property will be subject to the provisions of this Agreement.
"Transfer" means any sale, assignment or transfer, voluntary or involuntary, of any
interest in the Property, including, but not limited to, a fee simple interest, a joint tenancy
interest, a life estate, a leasehold interest, or an interest evidenced by a land contract by
which possession of the Property is transferred and Owner retains title. Any Transfer
without satisfaction of the provisions of this Agreement is prohibited. Transfers by gift,
devise, or inheritance to an existing spouse who is also an obligor under the Note; by an
Owner to a spouse where the spouse becomes the co -owner of the Property; to a
spouse who is also an obligor under the Note, as part of a dissolution proceeding; by
the Owner into an inter vivos trust in which the Owner is the beneficiary; or a transfer to
a Member of the Owner's Immediate Family shall not be considered a Transfer for the
purposes of this Agreement; provided, however, that the Owner must provide notice of
such intended transfer to the City pursuant to Section 6 (Notice of Intended Transfer) of
this Agreement.
6. NOTICE OF INTENDED TRANSFER
FTHB — Affordability /Recapture Agreement, June 2008 - Page 3 of 11
• •
In the event the Owner intends to Transfer or vacate the Property, the Owner shall
promptly notify the City in writing of such intent. The written notice shall be given in
accordance with Section 20 (Notices) of this Agreement at least sixty (60) days prior to
the actual date of the Transfer or vacation of the Property: Said notice from the Owner
shall be sent by certified mail, return receipt requested. Following receipt of such
notice, the City may notify prospective eligible purchasers of the Property that the
Property is available for purchase, or the City may purchase the Property.
7. CITY PURCHASE OPTION
The Owner agrees that the City shall have the option to purchase the Property (the
"Option ") for an amount equal to the lesser of the following: the Fair Market Value of
the Property (as determined pursuant to Section 8 - Fair Market Value), the offered
sales price, or a price mutually agreed upon by the Owner and the City. If the City
decides to exercise its Option to purchase the Property, it shall within thirty (30) days of
receipt of the notice specified in Section 6 (Notice of Intended Transfer), notify the
Owner in accordance with Section 20 (Notices) of this Agreement that it chooses to
exercise the Option. If the City exercises the option to purchase, it shall purchase the
Property within sixty (60) days of the date it receives the notice specified in Section 6
(Notice of Intended Transfer). The City may, instead of purchasing the Property itself,
assign its right to purchase the Property to a person who meets the criteria established
by the City for the First -Time Homebuyer Program or to a governmental agency or
nonprofit organization which is devoted to the provision of affordable housing.
8. FAIR MARKET VALUE
If it is necessary to determine the fair market value of the Property (the "Fair Market
Value "), it shall be determined by a real estate appraiser. The appraisal shall be made
by an independent residential appraiser selected by the Owner, from a list of appraisers
provided by the County. Each appraiser on the County's list shall have been previously
approved by the Federal National Mortgage Association (Fannie Mae or FNMA) or the
Federal Housing Administration (FHA) and placed on their respective lists of approved
residential property appraisers. If possible, the appraisal shall be based upon the sales
prices of comparable properties sold in the market area during the preceding three -
month period. The cost of the appraisal shall be borne by the Owner. In the event that
the Owner has made capital improvements to the Property which have increased the
value of the Property or if damage or deferred maintenance has occurred while the
Owner owned the Property which has decreased the value of the Property, the
appraisal shall specifically ascribe a value to these adjustment factors and state what
the fair market value of the Property would be without such adjustments. Nothing in this
Section shall preclude the Owner and the City from establishing the Fair Market Value
of the Property by mutual agreement in lieu of an appraisal pursuant to this Section.
9. REPAYMENT OF NOTE UPON TRANSFER BY OWNER; CITY
PURCHASE OPTION
FTHB — Affordability /Recapture Agreement, June 2008 - Page 4 of 11
• •
If the City exercises its Option to purchase the Property, the outstanding amount of
principal and interest due under the Note shall be paid to the City in the form of a credit
against the purchase price to be paid by the City to the Owner.
10. TRANSFER BY OWNER
In the event the City does not exercise its Option to purchase pursuant to Section 7
(City Purchase Option) the Owner may sell the Property to a person of the Owner's
choosing (the "Proposed Purchaser") on the terms set forth in this Section.
Upon Transfer the Owner shall (a) pay all of the principal and interest due to the First
Lender, (b) recover the down - payment and the Value of Improvements, if any, less the
value of any Needed Repairs on the Property, and, (c) pay to the City all principal and
interest on the Note. Needed Repairs shall mean those repairs required to fix any
damages to the Property, as determined by the City. Value of Improvements shall
mean the value of any substantial structural or permanent fixed improvements which
value shall be determined by an appraisal, performed at the Owner's expense, made by
an independent residential appraiser selected by the Owner, from a list of appraisers
provided by the County. Each appraiser on the County's list shall have been previously
approved by the Federal National Mortgage Association (Fannie Mae or FNMA) or the
Federal Housing Administration (FHA) and placed on their respective lists of approved
residential property appraisers.
11. ENCUMBRANCES
If Owner further encumbers the Property, except for the First Lender's Deed of Trust
and the City Deed of Trust, the Owner shall repay the City Loan in accordance with
Section 5(b) of the Note (Repayment) and Section 8 (Notice Required) of the Note.
12. DEFAULTS AND REMEDIES
Upon a violation of any of the provisions of this Agreement by the Owner, the City may
give written notice to the Owner consistent with the provisions in Section 10 of the City
Deed of Trust (Default; Remedies). If the violation is not corrected to the satisfaction of
the City within a reasonable period of time, not longer than thirty (30) days after the date
the notice is mailed, or within such further time as the City determines is necessary to
correct the violations, the City may declare a default under this Agreement. Upon the
declaration of a default or if the Owner makes any misrepresentation in connection with
receiving any benefits under this Agreement, the City may: (a) declare all amounts due
under the Note immediately due and payable without further demand and may invoke
the power of sale under the Deed of Trust; and (b) apply to a court of competent
jurisdiction for specific performance of this Agreement, for an injunction prohibiting a
proposed sale or transfer in violation of this Agreement, for a declaration that a transfer
in violation of this Agreement is void, and for any such other relief at law or in equity as
may be appropriate.
FTHB — Affordability /Recapture Agreement, June 2008 - Page 5 of 11
0 •
13. NOTICE OF DEFAULT AND FORECLOSURE
A request for notice of default and any notice of sale under any deed of trust or
mortgage with power of sale encumbering the Property shall be recorded by the City in
the Office of the Recorder of San Luis Obispo County for the benefit of the City. The
City may declare a default under this Agreement upon receipt of any notice given to the
City pursuant to Civil Code Section 2924b, and may exercise its rights as provided in
Section 12 (Defaults and Remedies).
In the event of default and foreclosure, the City shall have the same right as the Owner
to cure defaults and redeem the Property prior to the foreclosure sale. Nothing herein
shall be construed as creating any obligation of the City to cure any such default, nor
shall this right to cure and redeem operate to extend any time limitations in the default
provisions of the underlying deed of trust or mortgage.
14. RESTRICTIONS ON FORECLOSURE PROCEEDS
If a creditor acquires title to the Property through a deed in lieu of foreclosure, a
trustee's deed upon sale, or otherwise, the Owner shall not be entitled to the proceeds
of sale to the extent that such proceeds of such sale exceed the proceeds paid or
credited to the creditor until the City has received the amount of principal and interest
due the City on its Note. The Owner shall instruct the holder of such excess proceeds
to pay such proceeds to the City as repayment for, and in consideration of, the financial
assistance provided in the development of the Property.
15. BINDING ON SUCCESSOR AND ASSIGNS
This Agreement shall bind, and the benefit hereof shall inure to, the Owner, his or her
heirs, legal representatives, executors, successors -in- interest and assigns, and to the
City and its successors, until the earlier of (a) the end of the Term of this Agreement, or
(b) the date the lesser of the offered sales price, the Fair Market Value or the price
mutually agreed upon by the Owner and the City under the purchase Option is paid to
the Owner by the City, or (c) the date of a Transfer of the Property.
16. SUPERIORITY OF AGREEMENT
The Owner covenants that he or she has not, and will not, execute any other agreement
with provisions contradictory to or in opposition to the provisions hereof, and that, in any
event, this Agreement is controlling as to the rights and obligations between and among
the Owner, the City and their respective successors.
17. RIGHTS OF BENEFICIARIES UNDER DEEDS OF TRUSTS
Notwithstanding any other provision hereof, this Agreement shall not diminish or affect
the rights of the First Lender under the First Lender's Deed of Trust or any subsequent
First Lender Deeds of Trust hereafter recorded against the Property and the provisions
FTHB — Affordability /Recapture Agreement, June 2008 - Page 6 of 11
of this Agreement shall be subordinate to the lien of the First Lender's Deed of Trust
and shall not impair the rights of the First Lender, or such lender's assignee or
successor -in- interest (including but not limited to HUD, FNMA, Freddie Mac, the
Veterans Administration, or the California Housing Finance Agency, if applicable), to
exercise its remedies under the First Lender's Deed of Trust in the event of default
under the First Lender's Deed of Trust by the Borrower. Such remedies under the First
Lender's Deed of Trust include the right of foreclosure or acceptance of a deed or
assignment in lieu of foreclosure. After such foreclosure or acceptance of a deed in lieu
of foreclosure, this Agreement shall be forever terminated and shall have no further
effect as to the Property or any transferee thereafter; provided, however, if the holder of
such First Lender's Deed of Trust acquired title to the Property pursuant to a deed or
assignment in lieu of foreclosure, this Agreement shall automatically terminate upon
such acquisition of title, provided that (a) the City has been given written notice of
default under such First Lender's Deed of Trust, and (b) the City shall not have cured
the default under such First Lender's Deed of Trust within the 30-day period provided in
such notice sent to the Lender, or commenced to cure the default within such 30 -day
period and given its firm commitment to complete the cure in form and substance
acceptable to the First Lender.
If, during the original Term of this Agreement, the owner of record before the termination
event, or any entity that includes the former owner or those with whom the former owner
has or had family or business ties, obtains an ownership interest in the Property, this
Agreement shall be revived according to the original provisions.
18. INVALID PROVISIONS
If any one or more of the provisions contained in this Agreement shall for any reason be
held to be invalid, illegal or unenforceable in any respect, then such provision or
provisions shall be deemed severable from the remaining provisions contained in this
Agreement, and this Agreement shall be construed as if such invalid, illegal or
unenforceable provision had never been contained herein.
19. CONTROLLING LAW
The terms of this Agreement shall be interpreted under the laws of the State of
California.
20. NOTICES
All notices required herein shall be sent by certified mail, return receipt requested or
express delivery service with a delivery receipt, and shall be deemed to be effective as
of the date received or the date delivery was refused as indicated on the return receipt
as follows:
FTHB — Affordability /Recapture Agreement, June 2008 - Page 7 of 11
To the Owner;
At the address of the Property.
To the City;
Community Development Director
City of San Luis Obispo
919 Palm Street
San Luis Obispo, CA 93401
The parties may subsequently change addresses by providing written notice of the
change in address to the other parties in accordance with this Section (Notices).
21. INTERPRETATION OF AGREEMENT
The terms of this Agreement shall be interpreted so as to avoid speculation on the
Property and to insure to the extent possible that its sales price and mortgage payment
remain affordable to persons and families of lower income.
22. EXHIBITS
Any exhibits referred to in this Agreement are incorporated_ in this Agreement by such
reference.
Owner* }
Date
* Signatures must be notarized
Owner*
Date 0
FTHB — Affordability /Recapture Agreement, June 2008 - Page 8 of 11
0 0
State of California )
ss.
County of )
O( , before me,
persona appeared
MR proved to me on the basis of satisfactory evidence to be th persor awhose nam (&)
subscribed to the within ' trument and acknowledged to me that hufstTeMhO
executed the same iffier he" _ uthorized capacity(ies), and that by is e e
signature on the instrument the persoro, or the entity upon behalf of which t e
person s9acted, 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 fficial seal. Conunbsion # 1736:
Noun► Pub6a - CaWornw ✓
San Luis Obispo county -
. t�rCann► 6�IesApr 1 a Son
Signatu e
Si at f y Public
(Seal)
FTHB — Affordability /Recapture Agreement, June 2008 - Page 9 of 11
ILLEGIBLE NOTARY SEA
L DECLARATION
Government Code 27361.7
I certify under penalty of perjury under the laws of the State of California that the notary
seal on the document to which this statement is attached reads as follows:
Name of Notary: J$Gt y I F&,Pi
Name of County: Si4m 1.,4 (S
Date of of Commission Expires: l
Notary Identification Number: l 3 980 C7
(For Notaries commissioned after 1/1/1992)
Steve Worthington
Date:
Location: San Luis Obispo, California
•
CITY OF "SAN LUIS OBISPO:
By
"Ifeth Fla oian
City Administrative Offider
Dated:
Signature acknowledged:
APPROVED AS TO FORM:
By:
Jon an Lokelt
City Attorney
Dated: juLi 2.t 1 2-eo
r�
f. J
FTHB — Affordability /Recapture Agreement, June 2008 - Page 10 of 11
• •
STATE OF CALIFORNIA )
)SS
COUNTY OF SAN LUIS OBISPO )
On July 23, 2008, before me Audrey Hooper, City Clerk, personally appeared Ken Hampian,
City Administrative Officer, CITY OF SAN LUIS OBISPO, who proved to me on the basis of
satisfactory evidence to be the person4) �whose name is/am subscribed to the within
instrument and acknow edged to me that he /shaAho y executed the same in his/her -
authorized capacity(05& , and that by his/kenf heir signaturgV on the instrument the person(W, 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.
WITNESS my hand and official seal.
Signature
EXHIBIT "A"
(LEGAL DESCRIPTION)
Real property in the City of San Luis Obispo, County of San Luis Obispo, State of California,
described as follows:
PARCEL 1:
Unit 19 of Tract No. 2705 in the City of San Luis Obispo, County of San Luis Obispo, State of
California as shown on the Condominium Plan recorded December 31, 2007, as Instrument
No. 2007 - 083037 of Official Records in the office of the County Recorder of said county.
PARCEL 2:
An undivided 1/20 interest as tenants in common in and to the Common Area known as Lot 1
of Tract No. 2705,. in the City of San Luis Obispo, County of San Luis Obispo, State of
California according to map thereof recorded December 31, 2007 in Book 31, Pages 17 -18 of
Maps, in the office of the County Recorder of said county.
EXCEPTING THEREFROM Units 1 through 20 as shown on the Condominium Plan.
PARCEL 3:
A non - exclusive easement for ingress, egress and parking on and over that portion of Lot 1 as
more particularly shown and described on the aforesaid tract map, except those portions
designated on the above mentioned Condominium Plan which is appurtenant to the above
unit.
PARCEL 4:
An exclusive easement to that portion of Lot 1 which is appurtenant to the above referenced
unit and is designated "Floor Deck" on the above referenced Condominium Plan.
APN: 004 - 582 -008
FTHB — Affordability /Recapture Agreement, June 2008 - Page 11 of 11
END Of DOCUMENT