HomeMy WebLinkAboutD-1891 1043 Ella Street #10 security for note Recorded 06/30/2011Fidelity National Title Company
m
599 Higuera Street, Suite B, San Luis Obispo, CA 93401
805 7825900 • FAX 805 7825909
ATTN: Michael Codron/Tyler Corey DATE: June 30, 2011
City of San Luis Obispo ESCROW NO.: 11- 400104878 -CO
919 Palm Street LOAN NO.: n/a
San Luis Obispo, CA 93401 BORROWER(S): Daniel L. Slusser and Sara J. Slusser
PROPERTY ADDRESS:
1043 Ella Street #10, San Luis Obispo, CA 93401
We enclose the following documents and /or papers in connection with the above- referenced loan:
- Original Promissory Note
Escrow has closed and all documents have been recorded as of June 30, 2011. Your policy of title
insurance will follow under separate cover.
We trust that this transaction has been handled to your satisfaction and look forward to the opportunity
of serving you again in the near future.
Thank you!
Sincerely,
indy Opray
Escrow Officer
805 782 -6900
EO
enclosure(s)
Closing Letter — Lender /Mortgage Broker (clslnmtg) (10-03) (Rev. 12 -09)
N.- it
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City Clerk
City of San Luis Obispo
990 Palm Street
San Luis Obispo, CA 93401 -3249
$ 162,050
PROMISSORY NOTE -
SECURED BY DEED OF TRUST
Date: , ZD1 L
At San Luis Obispo, California
FOR VALUE RECEIVED, Daniel L Slusser and Sara J Slusser, ( "Maker ") promises to pay to
the order of the City of San Luis Obispo ( "City ") at 990 Palm Street, San Luis Obispo, California
93401 or such other address as City may from time to time designate, the sum of the difference
between the appraised market value and restricted sales price one hundred sixty -two thousand
z
t y Dollars ($162,050.00) according to the terms set forth herein. This Note shall accrue
interest, compounded monthly, at an annual rate of 4.5 percentage points added to the 11th
District Cost of Funds, as published by the Federal Home Loan Bank Board, amortized over 30
years. The Loan shall be amortized over thirty years, with monthly payments of principal and
interest due and payable to the City on the first day of each month unless waived or forgiven, as
set forth below.
1. Security for Note. This Note is secured by a deed of trust dated . a y �_ g of I
herewith (the "Deed of Trust ") executed by Maker, as Trustor, and naming City as Beneficiary,
covering_ certain real property ( "the Property") owned by Maker in the County of San Luis
Obispo, State of California, commonly knows as 1.043 Ella Street #10, San Luis Obispo, which
Property is more particularly described in Exhibit A, attached hereto.
2. Incorporation of Affordable Housing Agreement. This Note and the Deed of Trust are
executed and delivered pursuant to that certain Affordable Housing Agreement" recorded in the
County of San Luis Obispo on April 1. 2008, regarding affordable housing requirements applying
to Tract 2865, the Terrace Commons residential development: Pursuant to the Affordable
Housing Agreement and Deed of Trust, Maker is to live at the Property. Consequently, this
Note is subject to section 711.5 of the California Civil Code, which grants to City the authority to
accelerate all amounts due under this Note if any subsequent transfer of the Property at any time
does not comply with the provisions of the Affordable Housing Agreement or Deed of Trust. The
Affordable Housing Agreement is incorporated herein by this reference as though set forth in its
entirety and attached hereto as Exhibit B.
3. City's Right of First Refusal. Upon resale, the City or the Housing Authority of the City of
San Luis Obispo shall have the first right of refusal to purchase the property at then current
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Affordable Housing Promissory Note
Page 2
•
appraised value. The consideration for the City's right of first refusal shall consist of I percent of
the principal balance remaining on the City's loan. If the City chooses to exercise the purchase
option, any accrued interest shall be forgiven and the principal balance of the City loan remaining
after deducting this 1 percent of the loan balance shall be credited toward -the purchase price. The
provisions of this section shall not impair the rights of a first mortgage lender secured by a
recorded deed of trust. The purchase money lender shall have a higher priority than the City's
loan. The City's security shall be prioritized as a second mortgage. This first priority applies to
the purchase money lender's assignee or successor in interest, to:.
i. Foreclose on the subject property pursuant to the remedies permitted by law and
written in a recorded contract or deed of trust; or
ii. Accept a deed of trust or assignment to the extent of the value of the unpaid first
mortgage to the current market value in lieu of foreclosure in the event of default
by a trustor; or
iii. Sell the property to any person at a fair market value price subsequent to
exercising its rights under the deed of trust. Any value in excess of the unpaid
mortgage and costs of sale administration shall be used to satisfy the City loan. In
no case may a first mortgage lender, exercising foreclosure assignment in -lieu of
foreclosure or sale, obtain value or rights to value greater than the value of the
outstanding indebtedness on the first mortgage at the time of the debt clearing
action.
The following types of transfers shall remain subject to the requirements of the City's loan
and right of first refusal: transfer by gift, devise, or inheritance .to the owner's spouse;
transfer to a surviving joint tenant; transfer to a spouse as part of divorce or dissolution
proceedings; or acquisition in conjunction with a marriage.
4. Due_ on Transfer. In the event Maker sells, leases, rents or otherwise transfers the
Property to any person or entity other than an "eligible household" (as such term is defined in the
Affordable Housing Agreement), then the Principal of and accrued interest on the Loan shall be
immediately due and payable to the City as set forth in the Deed of Trust in favor of City
recorded simultaneously herewith as a second deed of trust subordinate to the deed of trust of the
first mortgage lender on the Property.
5. Waiver of .Principal. and Interest. City waives timely payment of the Principal of and
interest on the Loan for such time as Maker, who has been determined by City or its Housing
Authority to be an eligible buyer, remains as the owner and occupant of the Property as Maker's
principal residence until May 20, 2056.
Affordable Housing Promissory Note
Page 3
1 6. Forgiveness of Loan. City will forgive the repayment of the outstanding Principal of the
2 Loan and all interest thereon as long as Maker, or subsequent buyer determined by City or its
3 Housing Authority to be an eligible household, remains as the owner and occupant of the
4 Property as Maker's principal residence until May 20,.2056.
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6 7. Prepayment. This Note may not be prep_ aid in whole or in part, unless called due by City.
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8 8. Payment. The amount due under this Note shall be paid without the necessity for notice
9 or demand by City.
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11 9. Payment Amount. The amount due under this Note shall be paid from the net proceeds
12 as a result of any transfer. Net proceeds is the sales price minus any loans or liens that are senior
1.3 to this Note and minus closing costs.
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15 10. Default Defined. In addition to other defaults referred to in this Note and the Deed of
16 Trust, it shall be a default under this Note if Maker fails to make any payment or perform. any
17 obligation under or in connection with (a) this Note, (b) the Deed of Trust, or (c) any other note,
18 trust deed or other obligation of Maker relating to the Property, including but not limited to the
19 Affordable Housing Agreement, or .secured by all or any part of the Property, whether junior or
20 senior to this Note, and if such failure is not cured within such time as may be permitted by the
21 obligation or the obligee.
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23 11. Options of City upon Default. Upon the occurrence of a default, City shall have the
24 option, without further notice or demand:
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26 (a) To declare the Note to be immediately due and payable;
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28 (b) If the default relates to a transfer of the Property, to bring an action at law or in
29 equity to require Maker and the proposed transferee to terminate and/or rescind the sales
30 contract or lease and /or to declare the transfer void, notwithstanding that the transfer may
31 have closed and become final as between Maker and the transferee; or
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33 (c) To pursue any other remedy available under this Note or the Deed of Trust, or
34 at law or in equity or under any other agreement, instrument or document entered into by
35 Maker and City, or as provided in the Affordable Housing Agreement.
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37 12. Failure to Exercise Options. Failure to exercise any such option upon the occurrence of
38 one or more events of default shall not constitute a waiver of City's right to exercise any such
39 option at a later time.
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Affordable Housing Promissory Note
Page 4
1 13. Costs of Enforcement and Collection. If Maker defaults under this Note, Maker shall
2 pay all costs of enforcement and collection, including, but not limited to, costs and attorney's fees
3 whether or not such enforcement or collection includes filing a lawsuit or prosecution of a
4 lawsuit, if filed.
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6 14. City's Right to Transfer Interest in Note. City and any subsequent holder of this Note
7 may at any time, without consent of Maker, sell, assign, pledge, hypothecate, transfer and
8 negotiate or grant participation in any part of or any interest in City's rights and benefits under
9 this Note to another governmental body or nonprofit organization which is eligible to receive
10 such transfer under state and federal law.
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12 15. Waiver of Notice and Statute of Limitations. Except for any notice expressly required
13 by this Note, Maker waives demand, notice of demand, presentation for payment, notice of non-
14 payment or dishonor, protest and notice of protest. To the fullest extent permitted by law, Maker
15 waives the defense of the statute of limitations in any action on this Note or to recover on the
16 security for this Note.
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18 16. Liability. City's acceptance of any payment under this Note which is less than payment in
19 full of all amounts then due and payable, or the granting of any extension of time for payment of
20 any amount due under this Note or for the performance of any covenant, condition or agreement
21 entered into by Maker and City, or City's grant of any other indulgence to Maker, or City's taking
22 or release of other or additional security for the indebtedness evidenced hereby, or any other
23 modification or amendment of this Note shall in no way release or discharge the liability of
24 Maker or any endorser, guarantor or other person secondarily liable for this Note.
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26 17. Governing Law. This Note shall be governed by the laws of the State of California.
27 Maker agrees that the site of any hearing or action of whatever nature or kind regarding this Note
28 shall be conducted in the County of San Luis Obispo, State of California.
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30 18. Severability. If any, provision of this Note or any application of such provision be
31 declared by a court to be invalid or unenforceable, such invalidity or unenforceability shall not
32 affect any other application of such provision or the balance of the provisions hereof, which
33 shall, to the fullest extent possible, remain in full force and effect.
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35 MAKER:
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37 Daniel L. Slusser
38 (attach notarization)
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41 ara J. lusser
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Affordable Housing Promissory Note
Page 5
CITY:
Katie Lichtig, City anager
APPROVED AS TO FORM:
stine Dietrick, City Attorney
State of California }
County of San Luis Obispo }
On May 18, 2011 , before me, Laurie L. Thomas, Notary.Public ,
ate Name and Title ot the Otticer
personally appeared, Daniel L. and Sara J. Slusser ,
Name ot Signer(s)
who proved to me on the basis of satisfactory evidence to be the persons whose
names are subscribed to the within instrument and acknowledged to me that they
executed the same in their authorized capacities, and that by their signatures on
the instrument the persons, 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.
LAURIE L. THOMAS
Commission # 1791185
WITNESS my hand and official seal. a Notary Public - California
San Luis Obispo County
Signature
Signature of otary Public Place Notary Seal Above
• t Exhibit "A"
Affordable Housing Promissory Note
Page 6
Legal Description
THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF SAN LUIS
OBISPO, COUNTY OF SAN LUIS OBISPO, STATE OF CALIFORNIA, AND IS
DESCRIBED AS FOLLOWS:
Parcel 1:
An undivided 1 /16th interest in Lot 1 of Tract No. 2865, in the City of San Luis Obispo, County
of San Luis Obispo, State of California, according to the Map recorded April 1, 2008, in Book
31, Page 30 of Maps, in the office of the County Recorder of said County.
Except therefrom Units 1 through 16 and the exclusive use common area appurtenant to each unit
as disclosed and delineated on the Condominium Plan recorded April 1, 2008, Instrument No.
2008016266, Official Records.
Parcel 2:
Unit 10 together with the exclusive use common areas appurtenant to each unit as disclosed and
delineated on the Condominium. Plan recorded April 1; 2008, Instrument No. 2008016266,
Official Records.
3 JULIE ROi D MEL.
San Luis Obispo C — Clerk/Recorder 4/01/2008
Recorded at the request of 8:12 AM
Chicago Title Company
RECORDING REQUESTED BY:
City of San Luis Obispo
WHEN RECORDED MAIL TO:
Community Development Department
City of San Luis Obispo
919 Palm Street
San Luis Obispo, CA 93401 -3218
2008016267
1111111111111111111111111111
Titles: 1
Pages: 6
Fees
0.00
Taxes
0.00
Others
0.00
PAID
$0.00
Exhibit "B"
AFFORDABILITY AGREEMENT /DEED OF TRUST COVENANTS FOR TRACT 2865
THIS AGREEMENT is made and entered into this qW day of M,44cH ,
2008 , by and between the City of San Luis Obispo (the "City ") and _ Adelaida Prroperties.
L.P., a California Limited Partnership (Owner) collectively referred to as "the parties."
RECITALS
A. In 2007 , the City Council adopted Resolution No. 9876 -07 ; approving a
condominium conversion project to be identified as Terrace Commons with
sixteen dwellings and _ 16,576 total square feet (1,036 square feet each) of floor
area, located at 1043 Ella Street ("the project "); and
B. Project Condition (in Resolution No. 9876 -07, Section 2. Approval Subject to
Conditions, Item 8,) of that approval requires the applicant to provide a minimum of
two two - bedroom "very lows' category affordable dwelling units, including at least—:
.0- rentals and two for -sale units; and
C. The parties have agreed that the Owner shall construct and sell homes in
conformance with the City's Affordable Housing Standards; and
D. The City and Owner desire to assure that the affordable dwelling units identified
in this agreement remain affordable to very low, low or moderate income households
for a period of at least 45 years.
NOW, THEREFORE, the parties acknowledge and agree as follows:
ARTICLE 1. DEFINITIONS
1.01. "Moderate income households" means persons and families whose income does not
exceed 120 percent of the County of San Luis Obispo area median income, adjusted,
for family size pursuant to the City of San Luis Obispo Affordable Housing Standards.
1.02. "Low income households" means persons and families whose income does not exceed
80 percent of the County of San Luis Obispo area median income, adjusted for family
size pursuant to the City of San Luis Obispo Affordable Housing Standards.
1.02.5 "Very low income households" means persons and families whose income does not
i exceed 50 percent of the County of San Luis Obispo area median income, adjusted for
family size pursuant to the City of San Luis Obispo Affordable Housing Standards.
1.03 Persons and families meeting the definition under Sections 1.01 and 1.02 shall be
referred to as "eligible households."
1.04 `The properties" shall mean those specific real properties described in this agreement,
intended to be sold to and occupied by eligible households.
ARTICLE 2. RESTRICTIONS
2.01. The two units, which shall be Unit 8 (which shall have the mailing address of 1043
Ella Street #8) and Unit 10 (which shall have the mailing address of 1043 Ella Street
#10) to be constructed on the properties shall be used for owner- occupied housing
purposes and shall be sold to eligible households. At initial sale, the sales prices shall
be determined at time of building occupancy release, in accordance with City of San
Luis Obispo Affordable Housing Standards. For subsequent sales to eligible
households, sales prices shall be based on and consistent with then current City
Affordable Housing Standards.
2.02. The grant deed from Owner, or Owner's successors in interest and all future grant
deeds for transfers of interest in the properties shall contain a restriction providing that
for the period of time specified in this Agreement, there shall be no sale, lease, rental,
or other transfer of the properties except for the sale to and occupation by eligible very
low income households. Any sale, lease, rental, or other transfer of the property in
violation of this covenant shall be void.
2.03. The Owner agrees to retain the Housing Authority of the City of San Luis Obispo, or
other qualified entity acceptable to the City, for screening of potential buyers to
determine if they qualify as eligible households.
2.04. These affordability requirements shall be covenants running with the land as defined in
California Civil Code Section 1460, and shall apply to the properties as shown on
Exhibit A. 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 45 years from the date of
occupancy of the property. The parties agree that all future deeds or transfers of
interest regarding the properties shall show the restrictions of this Agreement for as
long as the Agreement is in effect.
2.05. When a designated affordable housing unit is first sold to an eligible buyer, the buyer
and City shall enter into an Affordable Housing Agreement which shall be recorded as
an encumbrance on the property, and secured by a recorded deed of trust. Said
agreement and deed of trust shall establish the monetary difference between the initial
purchase price and the initial appraised value as a loan payable to the City. Said loan
shall accrue interest, compounded annually, at an annual rate equal to 4.5 points
F4
added to the 11th District Cost of Funds as currently published by the Federal Home
Loan Bank Board, amortized over 30 years, and the monthly payments of principal and
interest shall be waived by the City as long as the owner previously approved by the
City Housing Authority as an eligible household, or subsequent buyers approved by the
Housing Authority as eligible households, continue to own and reside in the property
subject to the City loan as his or her principal residence.
2.06. If a designated affordable housing unit is sold, leased, or otherwise transferred to an
entity other than to an eligible household, in violation of this agreement, the City's loan
shall immediately become due and payable from the proceeds of sale of the property.
"Proceeds of sale" shall mean the value of any and all consideration, however
denominated, received or to be received by the Seller from the sale of the property
after the payment of the first deed of trust.
2.07. Upon resale, the City or the Housing Authority of the City of San Luis Obispo shall
have the first right of refusal to purchase the property or properties at current appraised
value. The consideration for the City's right of first refusal shall consist of 1 percent of
the remaining City loan balance. The balance of the City loan remaining after
deducting this 1 percent of the loan balance shall be credited toward the purchase
price if the City chooses to exercise the purchase option. The provisions of this section
shall not impair the rights of a first mortgage lender secured by a recorded deed of
trust. The purchase money lender shall have a higher priority than the City's loan. The
City's security shall be prioritized as a second mortgage. This first priority applies to
the purchase money lender's assignee or successor in interest, to:
(i) Foreclose on the subject property pursuant to the remedies permitted by law
and written in a recorded contract or deed of trust; or
(ii) Accept a deed of trust or assignment to the extent of the value of the unpaid
first mortgage to the current market value in lieu of foreclosure in the event of
default by a trustor; or.
(iii) Sell the property to any person at a fair market value price subsequent to
exercising its rights under the deed of trust. Any value in excess of the unpaid
mortgage and costs of sale administration shall be used to satisfy the City loan.
In no case may a first mortgage lender, exercising foreclosure assignment
in -lieu of foreclosure or sale, obtain value or rights to value greater than the
value of the outstanding indebtedness on the first mortgage at the time of the
debt clearing action.
In addition, the following types of transfers shall remain subject to the requirements of
the City's loan and right of first refusal: transfer by gift, devise, or inheritance to the
owner's-spouse; transfer to a surviving joint tenant; transfer to a spouse as part of
divorce or dissolution proceedings; or acquisition in conjunction with a marriage.
3
- ARTICLE 3. TIMING
i.
3.01. In the event the Owner has not completed the construction of the housing units and
received a final building inspection on all units within two years from the date of
conveyance of the Grant Deed, the property ownership and control of the properties
shall revert to the City. Extensions of this period of time may be granted at the
discretion of the City if the developer has demonstrated just cause and a "good faith"
effort to develop the property.
ARTICLE-4. GENERAL
4.01. Required notices shall be sent by certified mail, return receipt requested, to the
following addresses:
If to the City: City of San Luis Obispo
Community Development Director
919 Palm Street
San Luis Obispo, CA 93401 -3218
If to the Owners: Adelaida Properties, LP
Attn: Brian Rolph, Managing Partner
1063 Ella Street
San Luis Obispo, CA 93401
4.02. The Owner hereby specifically acknowledges and agrees to be bound by the
covenants respecting affordability on the Property contained herein.
IN WITNESS WHEREOF, this Agreement has been duly executed by the undersigned
as of the date set forth ,Blow.
Brian Rolph, Managing Partner
CITY:
On C. f
John Mandeville, Comm evelopment Director
By Kim Murry, Acting Director
4
� lqoz - -
Date
APPROVED AS TO FORM:
JO HAN P. LOWFLL
Attorney
• ' State of California }
County of San Luis Obispo }
On )Mn� 8 , 2008, before me, icy e', Sj l, xaj , , Notary
Public, personally appeared Brian Rolah who proved to me on the basis of satisfactory
evidence to be the person whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his authorized capacity, and that by his
signature on the instrument the person 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.
- Mm
�
Motary Public
Capacity claimed by signer(s):
DIANE R. STUART
COMM. #1581455
OTARY PUBLIC • CALFF2O!j
SM Ul1S OBISPO Ily Corms. Expires June 2
( ) individual(s) ( ) corporation ( X ) partnership ( ) attorney -in -fact ( ) political agency
State of California
County of San Luis Obispo)
On Mo Y(`)j2� - 1 ` , 2008, before me, T) 1u��, Sj UQL I , Notary Public,
personally appeared Kim Murry, who proved to me on the basis of satisfactory evidence to
be the person whose name is subscribed to the within instrument and acknowledged to me
that she executed the same in her authorized capacity, and that. by her signature on the
instrument the person 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.
1 ,r
Notary Public
Capacity claimed by signer(s):
( ) individual(s) ( ) corporation () partnership
DIANE R. STUAF T
COMM. #1581455
i7 VOTARY PUBLIC • CAUFOFMR
r • SAN LUIS OBISPO COUNTY
a �y Comm. Expires June 20.2009
( ) attorney -in -fact ( X ) political agency
• EXHIBIT "All
I Parcel l:
Lot of Tract No. 2865, in the City of San Luis Obispo, County of San Luis Obispo,
State of California, according to the map recorded 04 - of - 0$ in Book 31 , Page
3x-31 of Maps, in the office of the County Recorder of said County.
EXCEPT THEREFROM Units L through L and the appurtenant areas as disclosed and
delineated on the Condominium Plan recorded N -01 - 0$ as document no.
2008- oiLvxdo of Official Records.
Parcel 2:
Units 8 and 10 with appurtenant areas as disclosed and delineated on the
Condominium Plan recorded 04- 01- dg as document no. 2008- otugu(p of Official
Records.
END OF DOCUMENT