Occupancy, Refinancing, and Resale Restriction Agreement with Option to Purchase 2009-0723059F� %i� . DCaC # 2009- 0723059
ill RECORDED AT Ti-1E -,EOUEST OF
CHICAGO TITLE COMPANY IIII I I I III II IIIII IIIII II IIII IIII 111111 I II IIII
_ SUBDIVISION DEPT.
_RECORDING REQUESTED PURSUANT DEC 31, 2009 8:00 AM
TO GOVERNMENT' CODE SECTION 27383 OFFICIAL RECORDS
SAP! DIEGO COUNTY RECORDER'S OFFICE
When RecordedMail,To: FEESIDL BUTLER, UODUPlTWAY]ORDER
1`t7 PAGES: 3i
Poway Redevelopment Agency n /f�
13325 Civic Center Drive j!'J/I IIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIHill Hill IIIIIHill Hill pill IIIIIhill oil ill
Poway, CA Live 92064 D '2175
Attn: Executive Director
'2175
1 �!! natJ= u I I,—
OCCUPANCY, REFINANCING, AND RESALE RESTRICTION AGREEMENT
WITH OPTION TO PURCHASE
(Poway Redevelopment Agency – SHOP Program)
LOW INCOME HOUSEHOLD
Owner: Flamid Dadafshar and Afsaneh Shamlou
Address of Home: 12928 Metate Lane, Poway, CA 92064
Affordable.Housing Cost: $144,964
Median Income on Agreement Date: $74.900
This Occupancy, Refinancing, and Resale Restriction Agreement with Option to
Purchase (the "Agreement ") is entered into as of this 3� Q[ day of � UAa2 , 2001 by and
between the Poway Redevelopment Agency (the "Agency ") and Hainid Dadafshar and
Afsaneh Shamlou (the "Owner ").
RECITALS
A. The Agency desires to help low and moderate income first -time homebuyers
purchase a home.
B. To assist low and moderate income households purchase a.home, the Agency has
developed a second mortgage program (the "Supporting Home Ownership in Poway Program" or
"SHOP Program ") designed to assist qualified low and moderate income buyers, by financing the
difference between the market rate purchase price of the home and the amount affordable to the
qualified buyer.
C. The Agency is financing the SHOP Program from the Agency's Low and
Moderate Income Housing Fund. This Agreement implements the requirements of Health and
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Safety Code Section-33334.2 and 33334.3, which govern the use of Agency Low and Moderate
Income Housing, Funds. This Agreement also implements, the affordable housing production
requirements of Health and Safety Code Section 33413(6)(2).
D. Owner intends to purchase the property located at 12928 Metate Lane, Poway,
CA, 92064, in the. City of Poway and more particularly'described in, Exhibit .A (the "Home "). As
,a condition to the Agency's Loan, the Owner must execute this Agreement. The Owner agrees to
comply with this Agreement inconsideration of the Agency loan to Owner which permits Owner
to purchase the Home at an affordable housing cost to Owner.
E. The'purpose of this Agreement is to control.the resaleofthe Home. This
Agreement provides the Agency an option to purchase the Home at a restricted,price, given in
consideration of the economic.,benefits to the Owner resulting from purchase of-the Home at an
affordable level. This Agreement restricts the resale of the Home and specifies, among.other
requirements, that the Home may only be transferred to Low Income Households (as defined
below). This Agreement also requires that the Owner pay the.Agency Excess Sales Proceeds (as
defined below) in the event the Owner sells the Home in violation of this Agreement.
F. The Affordable Housing Cost of the Home paid by the Owner is set forth on page,
of this Agreement (the "Affordable Housing Cost"),
G. The Owner is receiving the following loans to purchase the Home:
Name of Lender
1. Bank of,America
2. City of Poway BEGIN
4.
Amount
$114,680
$ 23,035
Date Deed of Trust
Recorded
The purchase money loans listed above are, collectively, the "First Lender Loan." All lenders
listedabove_ shall � collectively be referred to as the "First Lender." The First1ender Loan is
secured,by 2 deeds of trust,executed by the Owner in favor of the First Lender and recorded in
the County of San Diego concurrently with this Agreement (collectively, the " First Lender Deed
of Trust ").
H. The Agency will provide tdthe Owner a second, mortgage, loan on the Home in
the amount of Two Hundred Ninety -Six Thousand' Thirty -Six Dollars ($296,036) (the
"Agency Loan "), using Agency Low and Moderate Income Housing Funds.
L The•Agency Loan is evidenced by a promissory note in the amount of the Agency
Loan (the "Agency Note "). The Agency Note also evidences Owner's obligation to pay Excess
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Sales Proceeds and Excess Rents. This-Agreement and the Agency 'NoWshall . be,secu_ red by a
deed of trust on the;Home, (the '!Agency Deed of Trust ").
J. This Agreement and the Agency Deed of Trust.shall be subordinate to,the.lien.of
the First Lender Deed of Trust. This Agreement will remain in full effect as an encumbrance on
the =Home after any prepayment of the Agency Note by the Owner. The Deed of Trust shall also
remain as.an encumbrance on the Home after any prepayment of the Agency Note by the Owner
to-secure compliance with the provisions of this Agreement and payment of Excess Sales
Procceds,or Excess Rents (as defined below).
NOW, THEREFOR-✓, in consideration of the benefits received by the Owner and the
Agency hereunder, the Ownenand the Agency agree, as follows:
1. DEFINITIONS AND•EXHIBITS
A. The following,terms' are specially defined for this Agreement and their definitions
can be found in the - sections indicated below:
(1) "Affordable Housing Cost" — Recital F
(2) "Agency" - First sentence of the Agreement on Page 1
(3) "Agency Deed of Trust" - Recital 1
(4) "Agency Loan" — Recital H
(5) "Agency Note" — Recital I
(6) "Agency Option" - Section 10
(7) "Agency Response Notice" - Section 8
(8) "Agreement" - First sentence of the Agreement on Page 1
(9) "Eligible Capital Improvements" - Section 1 IA(2)
(10) "Eligible Buyer" - Section 12B
(11) "Excess Sales Proceeds" - Section 13
(12) "Excess Rents" — Section 4
(13) "Fair Market Value" - Section 11 B
(14) "First Lender" - Recital G
3
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(15)
"First Lender Deed of Trust" - Recital G'
(16)
"First Lender Loan" - Recital G
(17)
"First Time Homebuyer Program " - Recital B
('18)
"I-ICD "— Section IIA(1)
(19)
"Home" — Recital D
(20)
"I -IUD" — Section 27
(21')
"Indexed Price" - Section I IA
(22)
"Inheriting Owner" — Section 6
(23)
"Income Qualified Household" — Section 12B
(24)
"Marketing Period" - Section 12A
(25)
"Maximum Restricted Resale Price" - Section 11
(26)
"Median Income" — Section 11 A
(27)
"Low Income Household" — Section 12B
(28)
"Owner," - First sentence of the Agreement on Page 1
(29)
"Affordable Housing Cost" — Recital F
(30)
"Owner's Notice of Intent to Transfer" - Section 7
(31)
" Program ,Manual" — Section 2
(32)
"Proposed Buyer" — Section 12
(33)
"SHOP Program" — Recital B
(3'4)
" Transfer" - Section 6
B. The following exhibits are attached to this Agreement:
(1).
Exhibit A: Legal Description of Home
(2)
Exhibit B: Form of Owner Occupancy Certification
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(3) Exhibit C'. Form of Owner's Notice, of Intent to Transfer
(4) Exhibit.D: Form of Owner Acknowledgement of•Agency
Response Notice
(5) Exhibit E: Form of Request for Agency Approval of Improvements to
the Home
(6) Exhibit F: Form of Owner Request for Agency Subordination to
Refinance First Lender Loan
OWNER CERTIFICATIONS; OWNER OCCUPANCY REQUIREMENT
The Owner certifies that (i) the financial and other information.previously provided to
qualify to purchase the, Home is:true' and correct as of the date first written above, (ii) the Owner
shall occupy the Home as the Owner's primary and sole place, of residence (iii) the.Owner is ,a,
first time home.buyer or, displaced homemaker as described iri the SHOP Program Manual (the.
"Program Manual ") for the P.regram; and (iv) the Owner will fully' cooperate with the- Agency•in
monitoring Owner's Compliance with this Agreement.
OCCUPANCY',OF HOME
The Owner shall occupy the Home as the Owner's sole place of residence within sixty
(60) days of close of escrow on the purchase of the Home by the Owner. The Owner shall be
considered as occupying the Home if the Owner is living imthe unit for at least ten (10) months
out of each calendar year-. On or before February I of each calendar year, the Owner shall
provide an annual written certification to the Agency, in the form shown in the attached
Exhibit 13 that the Owner is occupying the Home as his or her primary and sole place of
residence.
LEASING OF HOME
The SHOP 'Program4s,available for the purchase of an Agency sponsored newly
constructed Home: homes with rental units are not eligible for assistance under the SHOP
Program. The Owner shall not lease the Home to another party: Any lease of the Home is
prohibited, and shall constitute a Default under this Agreement. The Agency may then exercise
any of the remedies set forth in Section 15 below, including; without limitation, exercise of the
Agency Purchase Option upon Default. In the event the Owner leases the Home or any part of
the Home to a third party in violation of this Section 4, "Excess Rents" shall be due and payable
to the Agency immediately upon receipt thereof by the Owner. Excess Rents shall mean all rents
Owner receives from the third party. Such Excess Rents shall be considered a recourse debt of
the Owner to the Agency, as evidenced by the Agency Note, which the Agency may collect by
legal action against the Owner and /or by foreclosure under the Agency Deed of Trust.
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5. MAINTENANCE AND INSURANCE REQUIREMENTS
A. The Owner,shall maintain the Home, including landscaping, in good repair and in
a neat, clean and orderly condition (and as to landscaping, in a healthy condition) and in
accordance with all applicable laws, rules, ordinances, orders and regulations of all federal, state,
county, municipal,, and other governmental agencies and bodies having or claiming jurisdiction
and all their respective departments, bureaus, and officials, and with all applicable covenants
conditions and restrictions and homeowner's association rules. Owner will not commit waste or
permit deterioration of the Home, and shall make all repairs and replacements necessary to keep
the Home in good condition and repair. Failure by the Owner to maintain the Home shall
constitute a Default under this Agreement and the Agency may then exercise any of the remedies
set forth in Section 15 below, including, without limitation, exercise of the Agency' Purchase
Option upon Default.
B. The Owner shall maintain a standard all risk property insurance policy equal to
the current replacement .value of the Home adjusted annually to reflect changes to local building
costs calculated on a per square foot basis (or by appraisal, if requested by the Agency); naming
the Agency, the City and their employees, agents, officers, board members and /or council
members as additional insureds. Additional insurance requirements are set forth in Section 6 of
the Agency Deed of Trust. The policy shall be adjusted annually to retlect changes to local
building costs calculated on a per square foot basis (or by appraisal, if requested by-the
Agency).The Agency has thearight, but not the obligation, to inform Owner of the then - current
replacement value of the Home.
6. RESTRICTIONS ON RESALE OR TRANSFER OF THE HOME
A. Transfer. Any Transfer of the Home will be subject to the provisions of thi's
Agreement including, without limitation, the Agency Option described in Section 10 below.
Transfer means any sale, assignment or transter, voluntary or involuntary, of any interest in the
Home, including, but not limited to, a fee simple interest, ajoint tenancy interest, a life estate, a
leasehold interest, an interest evidenced by a land contract by which possession of the Home is
transferred and Owner retains title; or a deed of trust. Any Transfer without satisfaction of the
provisions of this Agreement is prohibited and shall constitute a Default under this Agreement
and the Agency may then exercise any of the remedies set forth in Section 15 below, including,
without limitation, exercise of the Agency Purchase Option upon Default. A Transfer shall not
include a transfer: (i) to an existing spouse or domestic partner; (ii) by a Owner to a spouse or
domestic partner where the spouse or domestic partner becomes the co-owner-of the Home; (iii)
between spouses as part of a marriage dissolution proceeding; (iv) to an existing spouse or
domestic partner of Owner by devise or inheritance following the death of Owner; (v) by Owner
into an inter vivos revocable trust in which Owner is the beneficiary;'or (vi) refinance of the First
Lender Loan meeting the requirements of Section 25 of the Agreement; provided, however, that
Owner shall provide Nvritten notice of all such transfers to Agency; and Owner shall continue to
occupy the Home as his or her principal place of residence (except where the transfer occurs
pursuant to subsection (iii) or (iv) above, in which event the transferee shall owner- occupy the
Home and affirmatively assume Owner's obligations under this Agreement, the Agency Note,
and the Agency Deed of Trust). All other Transfers shall require written notice to the Agency
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pursuant to Section 7 below and shall be to Eligible Buyers. Consideration received by the
Owner for such Transfer,shalfnot exceed the Maximum Restricted Resale Price defined in
Section 11 below. For purposes:of this section, "domestic partner" shall mean two unmarried
people, at least eighteen;(18) years of age, who have lived together continuously for;atleast one
,(1) year and who are jointly responsible for basic living expenses incurred during their domestic
partnership. Domestic partners may not be persons related to each other by blood or adoption
such -that their, marriage Would be barred in the state of California. Forpurposes of this section,
an individual shall be considered,a domestic partner of Owner upon presentation of an;affidavit
or other acceptable:evidence by Owner to the Agency.
B. Inheritance., In the event a Transfer occurs by devise or inheritance due -to death
of the Owner, the administratoeof the Owner's estate, the trustee of Owner's trust; or the person
inheriting the Home shall provide written notice to the Agency of the Owner's death_ within thirty
(30) days of the date of "death and the following procedures shall apply:
(1) The person inheriting the Home (the "Inheriting Owner ") shall provide the
Agency with income and other information, to be verified by the.Agency, so that the Agency
may determine if the Inheriting Owner qualifies as an Eligible Buyer, If the Inheriting =Owner
fails to- provide required, documentation, he or she shall be deemed not to qualify as an Eligible
Buyer. If the Inheriting'Owner is a Low Income Household, he or she shall succeed to the
Owner's interest and obligations under this Agreement, the Agency Note, and the Agency'Deed
of,Trust, new documents shall be executed between the Infieriiing Owner and theAgency and
recorded' against the Home. The new resale restriction agreement and option to purchase
between Inheriting Owner and Agency shall have a forty -five (45). year term that shall
commence upon,the recordation_of such new agreement. In addition, the.new promissory note
shall provide that the original purchase price in the new note is equal to the original purchase
price paid by the Owner andjdentified in Owner's note, should it become due from the Inheriting
Owner, shall be calculated based on the original purchase price paid,by the Owner. If the
Inheriting Owner fails to qualify-as an Eligible Buyer, he or she shall be required to Transfer-the
Home to Eligible Buyer at a price not exceeding the Maximum Restricted Resale Price,
pursuant to the procedures set forth in Sections 7 through 13 below and the Agency may exercise
the Agency Option pursuant,to'Section 10 below; provided, however that the Inheriting Owner
may own,and occupy the Home for up to twelve (12) months prior to providing an Owner's
Notice of Intent to Sell to the Agency pursuant to Section 7 below, and provided further that the
InheiitingOwner remains in compliance with the requirements of this Agreement and the'
Agency Deed of Trust. The Inheriting Owner shall not be required to occupy the FIome during
this twelve (12) -month time period, but may rent the Home only upon approval from the Agency
to low income tenants approved by the Agency for anamount that does not exceed the Owner's
Monthly cost of principal and interest on the First Lender Loan, and property insurance and
property taxes associated with the Home. In the event the Inheriting Owner rents the Home in
accordance to this section, the lease shall also be approved by the Agency.
(2) Failure cf an Inheriting Owner to follow the procedures and file the
notices described in,this. Section 6 shall constitute a Default under this Agreement and the
Agency may then exercise any of the remedies set forth in Section 15 below, including, without
limitation, exercise of the Agency Purchase Option upon Default.
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NOTICE OF INTENDED TRANSFER; PREPARATION OF HOME FOR SALE
A. In the event the Owner intends to Transfer or vacate the Home, the Owner shall
promptly give the Agency written notice of such intent (the "Owner's Notice of Intent :to
Transfer"). in the form shown in Exhibit C attached to this Agreement. The Owner shall give the
Agency the.Owner's Notice of Intent to Transfer prior to notifying real estate brokers or lenders
of Owrf &§.intent to Transfer the Home and prior to listing of the Home on the Multiple "Listing
Service. The.Owner's.Notice of Intent to Transfer shall be sent to the Agency by'certified mail,
return receipt requested at -the address provided in Section 32 of this Agreement. The Owner's
Notice of Intent to Transfer shall include the information necessary for the Agency to determine
the Maximum Restricted Resale Price of the Home. including the following information:
(1) the address of the Home;
(2) the date of purchase of the Home by the Owner;
(3) the purchase price of the Home paid by the Owner at the time of his /her
purchase;
(4) a copy of the.HUD -1 Settlement Statement or equivalent document from
the close of escrow on the Owner's purchase of the Home;
(5) if Owner has made Eligible Capital Improvements to the Home•that he /she
wishes to include in the calculation of.Indexed Price, a description of the improvements, the date
the improvements were made, a copy 'of the letter granting prior.Agency approval of the
improvements, evidence of cost of the improvements, and an appraisal of the value added to the
Home by the Eligible Capital Improvements;
(6) the date on which Owner intends to vacate Home;
(7) the date the Home will be placed on the market; and
(8) the.name and phone number of the person to contact to schedule
inspection of the Home by the Agency.
B. The Owner may not want to enter into a contract with ,a.real estate broker to, sell
the Home until the Ownernhas received.the Agency Response Notice pursuant to Section 8A
commission will be paid to a third part).
C. Following "delivery to the Agency of the Owner's Notice of Intent to Transfer, the
Owner shall prepare the I-[ome for sale, as follows:
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(1) within thirty (30) days of delivery of the ±Owner's Notice, of Intent to
Transfer, the Owner shall obtain and deliver to the, Agency, a�currentrwritten report of inspection
of the Home by a licensed structural pest control operator;
(2) within the sooner of (a) sixty (60) days from the date of delivery of the
O.wner's,Notice of Intent to Transfer, or (b) prior to two (2) weeks before close of escrow on the
Transfer, the Owner shall perform or cause to be performed-Section 1 pest control work in order
to repair all damage noted in the pest report including damage caused by infestation or infection
by wood - destroying pests (provided, however, that in the event Owner does not cause the work
to be performed in accordance with this subsection the cost of such work shall be considered
deferred maintenance and reflected,as a downward adjustment in the Maximum Restricted
Resale Price pursuant to Section 11):
(3) within,thirty'(30) days of the date of the Owner's Notice of Intent to
Transfer, the Owner shall allow the Agency, or its designee, to� inspect the Home to determine its
physical condition, and, if- requested by the Agency, following such inspection, the Owner shall
obtain and deliver to the- Agency a home inspection report prepared by a licensed,home
inspector.
(4) if the Home.is vacant, the Owner shall maintain utility connections until
the close of escrow on the Transfer;
(5) in the event of Agency purchase of the Home, the Owner shall permit a
final walk- through of the Home,by the Agency, or the Agency's designee. in the final three (3)
days prior to close of escrow on the Transfer.
& AGENCY RESPONSE TO OWNER'S NOTICE OF INTENDED TRANSFER
The Agency shall respond in writing (the "Agency Response Notice ") to the Owner's
Notice of Intent to Transfer within sixty (60) days of: Agency receipt of a complete Owner's
Notice of Intent_to Transfer that includes all information required under Section 7, including
Agency receipt -of the pest control report and home inspection report (if any) required pursuant
to Section 7C above. The Agency-Response Notice shall,inform the Owner of the Agency's
election to proceed under one of the following two alternatives:
A. Agency Exercise of Agency Purchase, Option. The Agency Response Notice may
notify the Owner that•the Agency, elects to exercise the Agency Option, or assign to another
public agency or non - profit' organization or Eligible Buyer the Agency's.right to purchase the
Home, as granted inspection 10 below, and shall include the Agency's calculation' of the
Maximum Restricted Resale Price to be paid by the Agency (or its assignee) pursuant to Section
11 below and the.Transaction Fee to be paid by the Owner pursuant to Section 10 below.
B. Owner Sale at Restricted Sale Price to Eliaible.Buye. Alternatively, the Agency
Response Notice may notify, the -Owner that the Agency will not at this time exercise the Agency
Option,to purchase the'Home and that the Owner may proceed to sell the Home to an Eligible
Buyer at a price not -to exceed the Maximum Restricted Resale Price, pursuant to the procedure
U5M3 \583952 2
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set forth in Section 12 below. In this event. the Agency Response Notice shall include the
following information; (1) the maximum qualifying income for an Eligible Buyer' (2) the
certifications required of an Eligible Buyer; (3) the Maximum Restricted Resale Price the Owner
may receive for the Home, calculated by the Agency pursuant to Section 1 1 below; (4) if
available, a list of potentially qualified SHOP home buyers.
OWNER ACKNOWLEDGMENT OF AGENCY RESPONSE NOTICE
No later than seven (7) days following the date of the Agency Response Notice, the
Owner shall acknowledge in writing to the Agency, in the form shown in Exhibit D attached to
this Agreement, that he /she has received the Agency Response Notice and still intends to
Transfer the Home.
10. AGENCY 13URCI -IASE OPTION
The Owner agrees that the Agency shall have the option to purchase the Home (the
"Agency Option ") for the Maximum Restricted Resale Price, calculated pursuant to Section 1 I of
this Agreement. The Agency may, instead of purchasing the Home itself, assign its right to
purchase the Home pursuant to the Agency Option to another public agency, a nonprofit
corporation, or to an Eligible Buyer. If the Agency assigns its purchase option, the assignee shall
sign the Agency Response Notice and shall thereby be bound to purchase the Home pursuant to
the terms of the Agency Option as set forth in this Agreement. The Owner may be required to
pay the Agency a transaction fee equal to the Agency's reasonable costs associated with the
exercise of the Option if the Agency (or its assignee) exercises the Agency Option and purchases
the Home; provided, however that such transaction fee shall not - exceed six percent (6 %) of tW
sales price of the home. The Agency Option may be exercised by the Agency or its assignee in
the Agency Response Notice, as described in Section 8A above, to be sent by the Agency to, the
Owner within thirty (30) days ofthe Agency's receipt of a complete Owner's Notice of Intent to
Transfer. If the Agency Response Notice notifies the Owner that the Agency or its assignee will
exercise the Agency Option.to purchase, the Agency or its assignee shall purchase the Home
within ninety (90) days of the date of the Agency Response Notice and title shall be delivered by
the Owner to the Agency by grant deed, free and clear of any mortgage or other liens, unless
approved in writing by the Agency. In the event of exercise of the Agency Option and purchase
of the Home by the Agency or its assignee, the Owner shall permit a final walk- through of-the
Home by the Agency or its assignee in the final three (3) days prior to close of escrow on the
Transfer.
11. DETERMINATION OF MAXIMUM RESTRICTED RESALE PRICE FOR AGENCY
PURCHASE OR RESTRICTED SALE
If the Agency (or its assignee) exercises the Agency Option, or if the Owner sells to an
Eligible Buyer, the maximum sales price (the "Maximum Restricted Resale Price ") that the
Owner shall receive from the Agency (or its assignee) or the Eligible Buyer for purchase of the
1-lome shall be the LESSER of the Indexed Price or the Fair Market Value.
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A. Indexed Price.
(1) The Indexed Price of the Home means: (a) the Affordable Housing Cost of
the Home at the time of purchase by the Owner increased by the percentage of increase in the
San Diego Area Median Income from the date of the original purchase of the Home by the
Owner to the date of receipt by the Agency of the Owner's Notice'of Intent to Transfer, and,
where applicable, adjusted pursuant to subsection (2) below to reflect the value of capital
iinprovements or the cost of deferred maintenance; plus (b) the outstanding balance of the
Agency Loan. "Median Income" shall refer to the median yearly income, adjusted for a
household size of four, in San Diego County, as published by the-California Department of
Housing and Community Development ( "HCD "). In the event such income determination is no
longer published by HCD, or, has not been updated for a period of at least eighteen (18),months,
the Agency may use or develop such other reasonable method as it may choose in order to
determine the median yearly income in San Diego County.
(2) Where applicable, the Indexed Price shall include an upward adjustment
reflecting the value of any substantial structural or permanent fixed improvements which the
Owner has made to the Home'with the Agency's prior written approval after Owner's purchase of
the Home. No such adjustment shall be made except for improvements: (a) made or installed.by
the Owner or Owner's contractor which conformed with applicable building codes at the time of
installation: (b) which extends the useful life or improves the functionality of the Home; (c)
approved in writing in advance by the Agency or its designee; and (d) whose initial costs exceed
Two Thousand Dollars ($2,000). All approvals for such improvements shall be subject to
Owner's receipt of a building permit. A form for use in requesting Agency approval of a Home
improvement is attached to this Agreement as Exhibit E. Improvements meeting the above
requirements are referred to in this Agreement as "Eligible Capital Improvements." The
adjustment to the Indexed Price for such Eligible Capital Improvements shall be limited to
appraised increases in value to the Home as a result of the improvements (pursuant to an
appraisal performed as described in Section I I B below), including-any depreciation in value of
the capital improvements since the time of installation, and not the cost of construction of the
improvements to the Home. The Indexed Price shall include.a downward adjustment, where
applicable, in an amount necessary to repair any violations of applicable building, plumbing,
electric, fire or housing codes or any other provisions of the Poway Building Code, as well as
any other repairs needed to put the Home into a "sellable condition ". Items necessary to put .a
Home into sellable condition -shall be determined by the Agency or its designee, and may include
cleaning, painting and making needed structural, mechanical, electrical, plumbing and fixed
appliance repairs and other deferred maintenance repairs.
B. Fair Market Value. In certain circumstances it may be necessary to determine the
fair market value of the Home without taking account of the resale restrictions imposed by this
Agreement'(the 'Fair Market Value "). These circumstances include: (1) where the parties wish
to determine if the.lndexed Price exceeds the Fair Market Value in order to determine the
Maximum Restricted Resale Price pursuant to Section 11; (2) where the parties wish to
determine the value of Eligible Capital Improvements in order to calculate the Indexed Price
pursuant to Section I IA; and (3) where the Owner wishes to refinance the first Lender Loan as
described in Section 25 below, and it is necessary to determine the Maximum Restricted Resale
1552\03 \583952.2
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Price in order to calculate the maximum principal amount of the refinanced -First Lender Loan.
If it is necessary to determine the Fair Market Value of the Home, it shall' be determined by a
certified MAI or, 'othenqualifiedteal estate appraiser approved,in,advance by the Agency. If
possible, the appraisal, shall be based upon the sales prices of comparable properties sold in the
market area during the preceding three (3) -month period. The cost of the appraisal shall be. Paid
by the Owner, unless the appraisal is obtained from a new buyer. In.the event that the Owner has
made capital improvements to the Home (which have been approved in advance by the Agency
pursuant to Section I 1 A of this Agreement) which have increased the value of the Home.or if
damage or deferred maintenance has occurred while the Owner owned the Home which has
decreased the value of the Home, the appraisal shall specifically ascribe a value to these
adjustment factors and state what the fair market value of the Home would be without such
adjustments by utilizing,the procedures outlined in Section I l A above for calculating the
Indexed Price. Nothing in this section shall preclude the Owner and the Agency from
establishing the Fair Market Value of the Home by mutual agreement in lieu of an appraisal
pursuant to this section.
12. SALE OF HOME BY OWNER IF AGENCY DOES NOT EXERCISE AGENCY
OPTION TO PURCHASE
In the event the Agency Response Notice notifies the Owner to proceed to,sell the Home
to an Eligible Buyer at a price not.exceeding the Maximum Restricted Resale Price, the Owner
may proceed to sell the Home in compliance with the following requirements:
A. Marketing. The Owner shall use bona fide good faith efforts to sell the Home to
an Eligible Buyer in compliance with this Section 12, including listing the Home on the'Multiple
Listing Service, keeping the I -Tome in an orderly condition, making the Home available-to" show
to agents and prospective. buyers,,and providing buyers with Eligible Buyer requirements,
including income qualifications and the Agency's form of disclosure statement summarizing the
terms of the buyer's resale agreement. A proposed buyer ( "Proposed Buyer ") who the:Owner
believes will qualify as an Eligible Buyer shall be referred to the Agency or its designee -fo6an
eligibility determination.
B. Eligible Buyer. A Proposed Buyer shall qualify as,an "Eligible Buyer"-if he or
she meets the following requirements, as determined by the Agency or its designee:
(1) Intent to Owner Occupv. The Proposed Buyer shall certify that he or she
will occupy the Home as his.or her sole place of residence throughout his or her ownership.
(2) Agreement to Sign Resale Restriction Agreement and to Cooperate with
Agency. The.Proposed Buyer shall agree to sign an occupancy, refinancing, and resale
restriction agreement with option to purchase restricting future resale of the Home and shall
agree to cooperate fully with the Agency in promptly providing all information requested by the
Agency to assist.the Agency in monitoring the Proposed Buyer's• compliance with the occupancy,
refinancing, and resale restriction agreement with option to purchase.
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1 ij1 \03 \583952 2
(3) Income Eligibility. The combined gross income for all household_
members of the Proposed'Buyer,ias;d"etermined by the Agency, does not exceed the qualifying
limit for Low,lncome households as established and amended from,tiirte to time pursuant to
Section 8 of the United States Housing Act of 1937 ( "Low Income Household ").
(4.) First Time Homebuyer. The Proposed Buyer shall be a first time
homebuyer or a,displaced homemaker as defined in the Program Guidelines.
C.. Maximum Restricted Resale Price. The purchase price for the sale of the Home
by the Owner to the Eligible,Buyer shall not exceed the Maximum Restricted Resale Price
calculated by the Agency pursuant to Section 11 above, as set forth in the Agency Response
Notice.
D. Disclosure and Submittals. The Owner and the Proposed Buyer shall provide3he
following information and documents to the Agency:
(1) The name, address and telephone number. in writing of the Proposed
Buyer
2187
(2) A- signed financial statement of the Proposed Buyer in a form acceptable
to,the Agency and any other supporting documentation requested by the Agency. The financial
information shall be'used by the Agency to determine the income eligibility of the Proposed
Buyer and the amount of any second mortgage assistance to be provided by the Agency:
(3) The proposed sales contract and all other related documents which shall
set forth all the terms of the sale of the Home. Said documents shall include at least..the
following terms: (a),the_ sales price; and (b) the price to be paid by the Proposed Buyer.for the
Owner's personal property, if any, for the services of the Owner, if any, and any credits,
allowances or other consideration, if any.
(4) A sworn statement, from the Owner and the Proposed Buyer in a form
acceptable to the Agency, that the - )sale shall be closed in accordance with the terms of the sales
contract and other documents subitted to and approved by the Agency. The statement shall
also provide that the Proposed Buyer or any other party has not paid and will not pay to the
Owner „ and 'the Owner has not received and will not receive from the Proposed Buyer or any
other party; money or other consideration, including personal property, in addition'to what, is set
forth in the sales contract and documents submitted to the Agency. The sworn statement shall
also include a, provision that in the event a Transfer is made in violation of the terms of this
Agreement or false or misleading statements are made in any documents or certification
submitted to the Agency, the Agency shall have the right to foreclose on the Home or file-an
action at law or in equity as may be appropriate. In any event, any costs, liabilities or obligations
incurred by the Owner and the Proposed Buyer for the return of any moneys paid or received in
violation of this Agreement or for any of the Owner's and /or the Proposed Buyer's costs and legal
expenses; shall be borne by the Owner and /or the Proposed Buyer and they shall hold the
Agency and its designee harmless and reimburse the Agency's and its designee's expenses, legal
13
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fees.and costs for any action they reasonably take in good faith in enforcing the terms of this
Agreement.
(5) An.executed buyer's occupancy, refinancing, and resale restriction'
agreement with option to purchase; deed of trust; promissory note; notice of affordability
restrictions on. transfer of property; and borrower's disclosure statement; from the Proposed
Buyer in forms provided,by the Agency, The recordation of the new deed of trust; buyer's
occupancy,, refinancing, and resale restriction agreement with option to purchase; an executed
Notice of Affordability Restrictions on transfer of property; and any other documents then
required by the Agency; shall be a condition of the Agency's approval of the proposed sale.,
(6) The name of the title company escrow holder for the sale of the Home, the
escrow number, and name, address, and phone number of the escrow officer.
(7) Upon the close of the proposed sale, certified.copies of the recorded
Agency deed of trust, buyer's resale agreement, notice of affordability restrictions on transfer of
property and borrower's disclosure statement, a copy of the final sales contract, settlement=
statement, escrow instructions, and any other documents which the Agency may reasonably
request.
13. TRANSFER IN VIOLATION OF AGREEMENT; PAYMENT TO AGENCY OF
EXCESS SALES PROCEEDS
If the Owner makes a_ Transfer, in violation of this Agreement, the Owner shall pay the
Excess Sales Proceeds to the Agency as set forth in this section. For purposes of this Agreement,
"Excess Sales Proceeds" shall mean one hundred ten percent (110 %) of the amount by which the
gross sales proceeds received by'the:Owner from the new buyer exceed the Maximum Restricted
Resale Price for the I -Lome (in the amountthat was stated in the Agency Response Notice). This
amount shall be a.debt of the'Owner to the Agency, evidenced by this Agreement and the
Agency Note; and secured by the Agency Deed of Trust. The Owner acknowledges that the
Agency shall have no obligation to cause reconveyance of this Agreement or of the Agency
Deed of Trust until the Excess Sales Proceeds are paid to the Agency. The Agency shall-utilize
the Excess Sales Proceeds for Agency affordable housing programs and to pay for administrative
fees,resulting from the Transfer in violation of this Agreement. The Owner and the Agency
acknowledge that.the'formula.for calculation of the amount of Excess Sales Proceeds due from
the Owner to the Agency is,intended to cause the Owner to receive the same net sales proceeds
(following payment by O.wner.of a standard broker's commission) from sale ,of the'Home at an
unrestricted price to a third party as the Owner would receive from sale of the Home to the
Agency or to an Eligible Buyer at the Maximum Restricted Resale Price.
14. REPAYMENT OF AGENCY NO'T'E
Upon the Agency's exercise of the Agency Option pursuant to Section 10, the amount of
Agency Loan shall be credited toward the purchase price. Upon Transfer to an Eligible Buyer,
the Eligible Buyer may assume the Agency Loan and the amount.of Agency Loan shall be
credited against the Eligible Buyer's purchase price so long as the Eligible Buyer executes a new
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resale agreement (with a new forty -five (45) -year term), promissory note,.Notice ofAffordability
Restrictions on `transfer of Property, and deed of trust in the'dhen- curfent form of these
documents to be provided by the Agency. Upon any other Transler.of the Home, the outstanding
principal and interest due under the Agency Note shall be repaid pursuant to the Agency Note
and shall not be credited against the purchase price. Repayment of the Agency Note shall.not
affect.Owner's obligation to comply with this Agreement, which shall remain in full force and
effect following any repaymenfof the Agency Note.
15. DEFAULTS
A. The following events shall constitute a Default by the Owner under this
Agreement:
(1) The Agency determines that the Owner has made a misrepresentation to
obtain the benefits of purchase of the Home or in connection with its obligations under this
Agreement;
above.
above.
(2) The Owner fails to occupy the Home, as required pursuant to Section 3
(3) The Owner leases the Home to a third party, as prohibited by Section 4
(4) The Owner makes a Transfer in violation of this Agreement;
(5) The Owner otherwise fails to comply with the requirements of this
Agreement, the Agency Note, or the Agency Deed of Trust and such violation is not corrected to
the,satisfaction of the Agency within thirty (30) days after the date of written notice_ by the
Agency to the Owner of such violation;
(6) A notice of default is issued under the First Lender Loan; or
(7) A lien is recorded against the Home other than the lien of a bona fide first
mortgage loan or ajumor loan' approved by the Agency in accordance with Section 25B.
B. Upon a declaration of Default by the Agency tinder this Agreement, the Agency
may:
(1) Declare the Agency Loan.and all Excess Sales Proceeds and /or Excess
Rents immediately due and payable without further demand, declare a default under the ,Agency
Note, and may invoke the power of sale under the Agency Deed of Trust;
(2) Apply to a court of competent jurisdiction for such relief at law or in
equity as may be appropriate;
15
1552\03 \5839522
2190
(3) Declare a Default under the Agency Note and Agency Deed of Trust and
pursue all Agency remedies under the Agency Deed of Trust; and
(4) Exercise the Agency Purchase Option Upon Default as described in
Section 18 below.
16. 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 Home shall be recorded by the Agency in the Office of the
Recorder of the County of Sari Diego for the benefit of the Agency. The Agency may declare a
Default under this - Agreement upon receipt of any notice given to the .Agency pursuam'to Civil
Code Section 2924b, and may exercise its rights as provided in Sections 15 and 18.
In the event of defau-Wand foreclosure, the Agency shall have the same right as the
Owner to cure defaults and redeem the Home prior to the foreclosure sale. Nothing herein shall
be construed as creating any obligation of the Agency 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.
If the Agency failed to file the request for notice of default, the Agency's right to
purchase the Home shall commence from the date a notice of default is given by the Agency to
the Owner.
17. NOTICE AND CURE
Upon Default or a violation of any of the provisions of this Agreement, the Agency may
give written notice to,the'Owner specifying the nature of the violation. If the violation is not
corrected to the satisfaction of Agency 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 Agency
determines is necessary to correct the violation, or if the Owner is in default under any other
mortgage loan on the Home, the Agency may declare a Default under this Agreement.
The Agency shall;notifv the First Lender at the address provided by the First Lendef'to
the Agency in the manner set forth in Section 32 of this Agreement, if the,Agency has declared a
default under this Agreement or under the Agency Note or the Agency Deed of Trust.
18. PURCHASE OPTION UPON DEFAULT
Notwithstanding, and in addition to, the remedies provided the Agency in Section 15, and
the Agency Option provided to the Agency in Section 10, the Owner hereby grants to the
Agency (or its assignee) the option to purchase the Home upon the declaration of a Default by
the Agency pursuant to Section 15. This option to purchase-is given in consideration of the
economic benefits received by the Owner resulting from purchase and ownership of the Home.
1552 \03\583952 2
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2191
The Agency (or its.assignee) shall have thirty (30) days after a Default . is declared to
notiYy the, Owner and the First Lender of its decision to exercise its option to purchase under this
'Section 18: Not later than ninety,(90),days after the notice is given by the Agency to the Owner
of the Agency's intent to exercise its option. under this Section 18, the Agency shall purchase the
Home for the Maximum Restricted Resale Price calculated in the manner set forth in Section 11.
19. NONLIABILITY OF THE AGENCY
A. No Obligation to,-Exercise Option. The Agency shall have no obligation to
exercise any option granted it under this Agreement. In no event shall the Agency become in
any way liable or obligated to the Owner-or any successor -in- interest to the Owner by reason,of
its option to purchase under Sections 10 and 18 nor shall the Agency be in any way obligated or
liable to the Owner'or any successor -in- interest to the Owner for any failure to exercise its option
to purchase.
B. Nonliabilityfor: Negligence, Loss, or Damage. Owner acknowledges,
understands and agrees that the relationship between Owner and the Agency is solely that of an
owner and an administrator of an Agency affordable housing program, and that-the Agency does
not undertake or assume any responsibility for or duty to Owner to select; review, inspect,
supervise, passjudgment on, or inform Owner of the quality, adequacy or suitability ofthe Home
or any other matter. The Agency owes no duty of care to protect Owner against negligent;
faulty, inadequate or defective building or construction or any conditionof the Home and Owner
agrees that neither Owner, or Owner's heirs, successors, or assigns shall ever claim, have or assert
any right or action against the Agency for any loss, damage or other matter arising out,of or
resulting from any condition, of the Home and will hold the Agency harmless from any liability;
loss or damage for these things.
C. Indemnity. Owner agrees to defend, indemnify, and hold the.Agency and the City
of Poway, and their agents, employees: officers and board members harmless from all losses,
damages, liabilities, claims, actions; judgments, costs, and reasonable attorneys fees that the
Agency, City of Poway, or such persons may incur as a direct or indirect consequence ,o f: (1)
Owner's• default, performance, or failure to perform,anyobligations as and when required by this
Agreement or the Agency Deed of Trust; or (2) the failure at anytime of any of Owner's
repickmations to the Agency to be true and correct.
20. RESTRICTIONS ON FORECLOSURE PROCEEDS
If a creditor acquires title to the Home through a deed in lieu of foreclosure, a trustee's
deed upon sale, or'othenvise, the Owner shall not be entitled to the proceeds of sale to the extent
that such proceedsotherwi'se payable to the Owner when added to the proceeds paid.or credited
to the creditor exceed the Maximum Restricted Resale Price. The Owner shall instruct the holder
of such excess proceeds -to pay such proceeds to the Agency (in addition to any other amounts
due the Agency from the Owner pursuant to the Agency Note or this Agreement), in
consideration of the benefits received by the Owner through purchase of the Home.
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2192
21. RESTRICTION ON INSURANCE PROCEEDS
If the Home is damaged or destroyed, the Owner has an obligation to rebuild or repair the
Home pursuant to Section 6 of the Deed of Trust. If the Owner does not rebuild or repair the
Home pursuant to Section 6 of the Deed otTrust, the Owner shall, subject to the rights of the
First Lender; repay the Agency Loan and pay the .Agency the portion of any insurance proceeds
received by the Owner for such destruction or damage which is in excess of the Maximum
Restricted Resale Price calculated pursuant to Section 1 1 above.
22. TERM OF AGREEMENT
All the provisions-of this Agreement, including the benefits and burdens, run with the
Home and 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 Agency and
its successors, until the earlier of (i) forty -five (45) years from the date of this Agreement,�or (ii)
the date of Transfer of the Home -to the Agency or another buyer in compliance with this
Agreement (including execution by the buyer of a new copy of this Agreement), which Transfer
shall cause the commencement of a new forty -five (45) -year affordability restriction.
23. 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
Agency and their respective successors.
24. SUBORDINATION
Notwithstanding any other provision hereof, the provisions of this Agreement,shall be
subordinate to the lien of the First Lender Loan and shall not impair the rights of the First
Lender, or the First Lender's successor or assign, to exercise its remedies under the First Lender
Deed of Trust in the event of default under this First Lender Deed of Trust by the Owner. Such
remedies under the First Lender 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 Home or any'transferee thereafter; provided, however, if the holder of such First Lender
Deed of Trust acquired title'to the Home pursuant to a deed or assignment in lieu of foreclosure
and no notice of default was recorded against the Home by such holder in connection therewith,
this Agreement and shall automatically terminate upon such acquisition of title, only if (i) the
Agency has been given written notice of default under such First* Lender Deed of Trust with a
sixty (60) -day cure period (which requirement shall be satisfied by recordation of a notice of
default under California Civil Code Section 2924), and (ii) the Agency shall not have cured the
default within such sixty (60) -day period. Owner agrees to record any necessary documents to
effect such termination, if applicable.
1552 \03 \533952 2
18
2193
25. REFINANCE OF FIRST.LENDER LOAN; JUNIOR LOAN
A. Refinance. The Owner covenants and agrees not to place any additional mortgage
or deed of trust, including any line of credit, on the Home without obtaining prior written"consent_
of the Agency.
B. Permitted. Encumbrance Amount. At no time shall the total principal amount of
all debt secured by the Home exceed the "Permitted Encumbrance Amount ", which is defined as
the greater of, (i) ninety per (90 %) of the Maximum Restricted Resale Price calculated
pursuant to Section_ 11 as of the date ofthe Owner's request to the Agency of approval of the
Owner's refinance (the "Refinance Request Notice"); or (ii) the outstanding balance of the,
existing First Lender Loan as.of the date of the Refinance Request Notice. Mortgage'loans
which include negative amortization and adjustable rate mortgages are prohibited. If escrow
does not close on the refinance within one hundred twenty (120) days of the date of the
Refinance Request Notice, the Agency shall have the right to recalculate the Permitted
Encumbrance Amount. Owner shall not be in Default hereunder at the time of initial . purchase of
the Home by the Owner, if, at•that -time, the initial debt secured by the Home exceeds the
Permitted Encumbrance Amount and Owner does not further encumber the Home until the
Permitted Encumbrance Amount complies with this paragraph.
C. Refinance of First Mortgage Loan. The Agency shall permit and approve a-
prepayment and refinance of the existing First Lender Loan and shall provide for the
subordination of this Agreement, the Agency Deed of Trust, and the Notice of Affordability
Restrictions on Transfer of Property to the refinanced First Lender Loan only if such refinance
does not cause the total debt "secured by the Home, including junior mortgage loans:and :equity
lines of credit, to exceed the Permitted Encumbrance Amount. The Agency will not approve any
mortgage loan which includes negative amortization, nor will the Agency approve any adjustable
rate mortgages.
D. Junior Loans and Equity Lmes'of Credit. Mortgage.loans or equity lines of credit
junior in lien priority to this Agreement, the Agency Deed of Trust and Notice of Affordability:
Restrictions on Transfer of Property are not permitted, except when expressly approved by the,
Agency in writing. The Agency shall only approve junior mortgage_, loans or equity lines,of,
credit which will not cause the total of all debt secured by the Home (calculated assuming a
maximum permitted draw on any.equity line of credit) to exceed the Permitted Encumbrance
Amount. The Agency will notapprove any mortgage loan or equity line of credit which includes
negative amortization, nor will the Agency approve any adjustable rate mortgages.
E. Notwithstanding the provisions of this subsection D, mortgage loans from other
public agencies designed to increase affordable homeownership, that are compatible with the
SHOP Program and that do not cause the; Owner's total housing costs to exceed a housing cost
that is affordable to Low Income Households as determined by the Agency in accordance with
Community Redevelopment Law (California Health and Safety Code Sections 33000 el s), are
permitted.
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15521031553952 2
2194
F. Reguest.ofNotice of Default. Any time an Owner enters into a new mortgage
loan, including.junior mortgage loans and equity lines of credit, the Owner shall cause to be
recorded, against the Home a request for notice of default, providing for notice of default under
such loan to be delivered to the Agency.
G. Purpose of Restrictions on Refinance and Junior Loans. The Agency and the
Owner agree that the requirements of this Section 25 are necessary to ensure the continued
affordability of the Home to Owner and to minimize the risk of loss of the Flome by Owner
through default and foreclosure of; mortgage loans. Owner further acknowledges that violation
of the provisions of this Section 25 shall constitute a Default under this Agreement, for which the
Agency may exercise the Agency's option upon default pursuant to Section 10 above. A form
for use by the Owner in requesting Agency subordination to a refinanced first mortgage loan is
attached as Exhibit F to this Agreement.
H. Eligible Capital Improvements. In the event (i) the Owner refinances the First
Lender Loan in accordance with subsection C, or (ii) the Owner borrows a junior loan or takes-an
equity-line of credit in accordance with subsection D and the funds from such refinance, loan, or
line of credit shall be used for Eligible Capital Improvements, Owner shall provide evidence to
Agency, in a form acceptable to Agency in its sole and absolute discretion, that any amount of
funds received by Owner for such Eligible Capital Improvements shall be and are used for the
construction of such Eligible Capital Improvements, which shall be subject to Agency's prior
written approval.
26. NONDISCRIMINATION
The Owner covenants by and for itself and its successors and assigns that there shall be
no discrimination against or segregation of a person or of a group of persons on account of race,
color, religion, creed, age, disability, sex, sexual orientation, marital status, ancestry or national
origin in the sale, transfer, use, occupancy, tenure or enjoyment of the Home, nor shall the
Owner or any person claiming under or through the Owner establish or permit any such practice
or practices of discrimination or segregation with reference to the use, occupancy, or transfer of
the Home. The foregoing covenant shall run with the land.
27. RIGHTS OF BENEFICIARIES UNDER DEEDS OF "rRUS "fS
This Agreement shall not diminish or affect the rights of the Agency under the Agency
Decd of'Trust.
Notwithstanding any other provision in this Agreement to the contrary, this Agreement
shall not diminish or affect the rights of the United States Department of Housing and Urban
Development ( "HUD ") or the Veterans Administration ("VA") under the First Lender Deed of
Trust or any subsequent First Lender deeds of trust hereafter recorded against the Home in
compliance with Section 25 above.
Notwithstanding any other provisions in this Agreement to the contrary, all of the
provisions of this Agreement shall terminate and have no further force in the event title is
20
1552\03 \593952 2
z.] 95
acquired by HUD Ur'VA ovanother party upon foreclosure .of'a ;deed of trust insured by HUD or
guaranteed'by VA.
28. HUD'FORBEARANCE RELIEF
Notwithstanding other provisions of this Agreement, the Agency Option on Default
pursuant to Section 18 above shall not be exercised by the Agency when a deed of trust insured
by HUD is secured by the.Home,'and: (i) the owner is undergoing consideration by HUD for
assignment forbearance relief;.or (ii) the owner is undergoing consideration for relief under
HUD's Temporary Mortgage Assistance Payment (TMAP) program.
29. 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.
30. CONTROLLING LAW
The terms of this Agreement shall be interpreted under, the laws of the State of California.
The venue for any legal action pertaining to this Agreement shall be San Diego County,
California.
31. NO WAIVER
No delay or omission in,the exercise of any right or remedy of Agency upon any default
by Owner shall impair such right or remedy or be construed as a waiver. The Agency's failure to
insist in any one or more instance 'upon the strict observance of the terms of this Agreement shall
not be considered a waiver of the Agency's right thereafter to enforce the provisions of the:
Agreement. The Agency shall not waive its rights to enforce any provision of this Agreement
unless it does so in writing, signed by an authorized agent of the Agency.
32. NOTICES'
All notices required herein shall be sent by certified mail, return receipt requested,
express delivery service with a delivery receipt, or personal delivery with a delivery receipt and
shall be deemed to be effective as of the date received, the date delivery was refused, or the date
returned as undeliverable as indicated on the return receipt as follows:
To the Owner:
Hamid,Dadafshar and Afsaneh Shamlou
12928 Metate Lane
Poway, CA 92064
21
1952W3\533952 2
2196
Wthe.Agency:
Poway Redevelopment Agency
13325 Civic Center Drive
Poway, CA 92064
Attn: Executive Director
To the First Lender:
Bank of America
The parties may subsequently change addresses by providing written notice of the change in
address to the other parties'itraccordance with this Section.
33. INTERPRETATION OF AGREEMENT
The terms of this Agreement shall be interpreted so as to avoid speculation on the Home
and to insure to the extent possible that- its,,sales price and mortgage payment remain affordable
to Low Income Households.
34. EXHIBITS
Any exhibits referred to in this Agreement are incorporated in this Agreement by such
reference.
35. MONITORING AND INSPECTION BY AGENCY
A. The Agency (or its designee) may enter the Home for inspection following two
(2) business days advance written notice.
B. The Owner shall retain all records related to compliance with obligations under
this Agreement-for a period.of not less than five (5) years, and shalt make such records available
to the Agency or its designee for inspection and copying upon five (5) business days advance
written notice.
C. The Agency shall monitor Owner's compliance with the requirements of this
Agreement on an annual basis. Owner shall cooperate with Agency monitoring and provide
required certifications and other information required by the Agency to determine compliance
within ten (10) days of receipt of a written request by the Agency.
36. COVENANTS RUNNING WITH THE LAND
A. Owner hereby subjects the Home to the covenants and restrictions set forth in this
Agreement. Owner hereby declares its express intent that the covenants and restrictions set forth
herein shall be deemed covenants running with the land and shall pass to and be binding upon all
parties having any interest in the Home throughout the term of this Agreement set forth in
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2197
Section 22. Each and everyycontract, deed, lease or other instrument covering, conveying or
otherwise transferring the.Home or any interest therein, as the case may be; shall conclusively be
held to have been executed, delivered and accepted subject to this Agreement regardless of
whether the other party or parties to such contract have actual knowledge of this Agreement.
B. The Owner and the Agency hereby declare their understanding and intent that: (i)
the covenants and restrictions contained in this Agreement shall be construed as covenants
running with the land pursuant to California Civil Code Section 1468 and not as conditions
which might result in forfeiture of title by Owner: (ii) the burden of the covenants and
restrictions set forth in this Agreement touch and concern the Home in that the Owner's legal
interest in the Home may be rendered less valuable thereby; and (iii) the benefit of the covenants
and restrictions set =forth in this Agreement touch and concern the land by enhancing and
increasing the enjoyment and use of the Home by Eligible Buyers, the intended beneficiaries of
such covenants and restrictions.
C. All covenants and restrictions contained herein without regard to technical
classification or designation shall be binding upon Owner for the benefit of the Agency and
Eligible Buyers and such covenants and restrictions shall run in favor of such parties for the
entire period during which such covenants and restrictions shall be in force and effect, without
regard to whether the Agency is'an owner of any land or interest therein to which such covenants
and restrictions relate.
37. ENFORCEMENT
Notwithstanding any other provision of the law, all covenants and restrictions contained
herein which implement Health and Safety Code 33334.3 and /or 33413(c)(3), or successor
provisions, shall run with the land and shall be enforceable by the Agency and the City of Poway
and any of the parties listed in Health and Safety Code Section 333343(6)(7), so long as such
provision or successor provision remains in effect.
38. DATABASE
Owner hereby acknowledges and agrees that Health and Safety Code Section 33418(c)
requires that the home be listed in a database that shall be made available to the public on the
internet'and which will include the street address, assessor's parcel number, and other
information about the home.
39. OWNER'S ACKNOWLEDGEMENT OE RESALE RESTRICTION
Owner hereby acknowledges and agrees that:
A. Owner hereby subjects the Home to certain restrictions, and limits the price for
which Owner may sell the Home and the persons to whom Owner may sell the Home. The
resale price limitation, and other provisions contained in this Agreement, restrict the full benefits
of owning the Home. Owner may not enjoy the same economic or other benefits from owning
the Home that Owner would enjoy if this Agreement did not exist.
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B. Absent the'provisions of this Agreement, and the Agency loan, the Home could
not be made available to Eligible,Buyers at an affordable price, including Owner.
C. Owner understands all of the provisions of this Agreement. In recognition of the
acknowledgments and agreements stated in this Section 37, Owner accepts and agrees to the
provisions of this Agreement with the understanding that this Agreement will remain in full force
and effect as to the Home following any Transfer of the Home throughout the term of this
Agreement.
D. OWNER UNDERSTANDS THAT THE DETERMINATION OF THE
MAXIMUM RESTRICTED RESALE PRICE OF THE HOME TO AN ELIGIBLE BUYER
CAN BE MADE ONLY AT THE TIME OF THE PROPOSED TRANSFER, TAKING INTO
CONSIDERATION INCREASES IN MEDIAN INCOME AND OTHER FACTORS THAT
CANNOT BE ACCURATELY PREDICTED AND THAT THE SALES PRICE PERMITTED
HEREUNDER MAY NOT INCREASE OR DECREASE IN THE SAME MANNER AS
OTHER SIMILAR REAL PROPERTY WHICH IS NOT ENCUMBERED BY THIS
AGREEMENT. OWNER FURTHER ACKNOWLEDGES THAT AT ALL TIMES IN
SETTING THE SALES PRICE OF THE HOME THE PRIMARY OBJECTIVE OF THE
AGENCY AND THIS AGREEMENT IS TO PROVIDE HOUSING TO ELIGIBLE BUYERS
AT AFFORDABLE HOUSING COST. THE MAXIMUM RESTRICTED RESALE PRICE
WILL ALMOST CERTAINLY BE LESS THAN OTHER SIMILAR PROPERTIES THAT
HAVE NO RESTRICTIONS.
AD —45 [Initialed by Owner(s)]
IN WITNESS WHEREOF, the parties have executed this Agreement on or as of the date
first written above.
AGENCY:
Poway Redevelopment Agency
By: ° Title:
(Type
(Type Name and "fitle)
24
1552 \03 \5839522
OWNER:
( ♦ ' C
z i J /ii i
(Type Name)
I
/ . 'G
(Type Name)
J'
2!99
STATE OF'.CALIFORNIA
COUNTY OP..SAN DIEGO
On NOV 25,'2-()0q , before me3rl ccy �(��� �(�5 Notary Public,
personally appeared iWo 6�1 I D, proved to me on the basis
of satisfactory evidence to be the:person(s) whose namQ/m�ubscribed to the within
instrument and acknowledged to me that i �executed the.same in iis 8epmTdn
authorized capacity(ie>),,and that by 1 e1r signature�on the instrument the person(s), or
the entity upon behalf of which the persort(aj'acted, executed the' instrument.
I certify UNDER PENALTY OF PERJURY under the laws of the Siate of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
titer Co�urta
C0mmWHmj0 ,1787479•
Na" Ptibtta"- Calitomla l
Son Dlepo edurty
apypy�Re¢msaDe- - - -
Notary Public
STATE OF CALIFORNIA
COUNTY OF SAN DIEGO
On f 20 ;.before me, / • Notary Public,
personally appeared proved to me on the basis
of satisfactory evidence to be the person(s) whose name(sj are subscribed to the within
instrument and acknowledged'to;me th t she /they executed the same i�her /their
authorized capacity(ies), and"that,b�er /their signature(s) on'the instrument the person(s), or'
the entity upon behalf of.which the persons) acted, executed the instrument.
1 certify UNDER PENALTY OF PERJURY under the laws of the State of California thaYthe
foregoing paragraph is true and correct.
wiTNESS my hand and official seal.
PATTY,N:SMffM
- 417454@9 --I J�; , L• fCJ /i %GIYL
�
NOTARY PP,UB UBLICi CALIFORNIA
Q 'C z
SAN DIEGO COUNTY" 1
My CommissionExpirss Notary Publ
JUNE •13; 2011
1 552\03\533952 2
2200
STATE OF CALIFORNIA
COUNTY OF SAN DIEGO
On.✓//1Mk4/ 'Q,;&20. before me, 4 /Y �f'a , Notary Public,
personally appeare FSzI/ s 1d , proved.to me on the basis
of satisfactory evidence to be the person(s) whose name(s) ' re subscribed to the. within
instrument and acknowledged to me that h sl they esecutcd.the same in per heir
authorized capacity(ies), and that by his4je ieir 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.
15521031533952 2
V
1552 \03 \583952 2
EXHIBIT A
Legal Description of the Home
A-1
2201
EXHIBIT "A"
Legal Description
PARCEL 1:
LOT 4 OF CITY OF POWAY TRACT NO. 06 -06 THE MEADOWS, IN THE CITY
OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, AS SHOWN
BY MAP NO. 15743, FILED IN THE OFFICE OF COUNTY RECORDER OF SAN
DIEGO COUNTY, CALIFORNIA, ON MARCH 5, 2009.
2202
To:
Prom:
Address of Home:
Date:
EXHIBIT B
Form of Owner Occupancy Certification
The Poway Redevelopment Agency ( "Agency ")
(name of owner(s)l ( "Owner(s) ")
( "Home ")
2203
By signature below, I [insert name or names of Ownerl hereby
certify to the Poway Redevelopment Agency under penally of perjury that I /we occupy the home
located at [insert addressl (the "Home ") as
my /our primary and sole place of residence and that I /we have occupied the Home for
U linsert numberl months of the calendar year ]insert
previous calendar yearl. Attached to this letter is a copy of [insert utility bill or
driver's license] showing my place of residence.
This Owner Occupancy Certification is signed on
perjury.
By:
I:
Due Date: February I of each calendar year.
20 penalty of
Owner (type namel
Owner (type namel
Attach copy of utility bill or driver's license showing address of Home.
B -1
1552 \03 \583952.1
EXI-IIBIT'C
Form of Owner's Notice of Intent to Transfer
To: The Poway Redevelopment Agency ( "Agency ")
From:
Address of Home:
Date:
[name of owner(s)] ( "Owner(s) ")
("Home")
2204
Please be notified pursuant to Section 7 of the Resale Restriction Agreement and Option to
Purchase between Owner and Agency dated that the Owner intends to transfer
the Home listed above.
A. The following information is provided to the Agency pursuant to Section 7 o the Resale
Agreement:
Address'of Home:
2. Date Owner purchased Home:
3. Affordable Housing Cost paid by Owner when Home was purchased:
4. Date Owner intends to vacate Home:
5. Date Home will be placed on market:
6. Name and phone number of person for Agency to contact to schedule inspection:
and
(name) (phone number)
B. As required by Section 7 of the Resale Agreement, the following documents are attached
to this Notice:
Copy of_HUD -I Settlement Statement from Owner's purchase of the property
2. If Owner has made Eligible Capital Improvements to the Home that Owner
wishes to include in the Agency's calculation of Indexed Price, check boa below
C -1
1 552 \03 \583952 2
2205
Yes. I have made Eligible Capital Improvements pursuant to Section I I of the Resale
Agreement. They are
]describe improvements]
and were completed on [insert date].
I attach the following documents to this letter:
a. copy of Agency letter granting prior approval of these improvements;
b. evidence of cost of these improvements;
appraisal showing value added to Home by the improvements.
C. 1 have not yet listed the Home for sale with a multiple listing service, or contacted a real
estate broker or financial institution. I agree to prepare the Home for sale by:
obtaining a pest control report within thirty (30) days of the date of this notice,
2. repairing all damage noted in the pest report within the sooner of: (i) sixty (60)
days from the date of this notice, or (ii) two (2) weeks prior to close of escrow or the transfer of
the Home,
3. allowing the Agency or its designee to inspect the Home within thirty (30) days of
this notice,
4. ifrequested by the Agency following the Agency's inspection, I will obtain a
home inspection report from a licensed home inspector,
5. maintaining utility connections until the Home is transferred,
6. permitting a walk through by the Agency prior to close of escrow or the transfer.
contact Agency to obtain, if available, a list of potential SHOP home buyers.
C -2
1552 \03 \583952 2
•k.�- .
2206
This Owner's Notice of Intent to Transfer is certified-by Owner to be true and correct and
is signed on
C -3
1552\03 \583952 2
[insert date] under penalty of perjury.
By:
Owner
By:
Owner
r .
LL•
EXHIBIT D
Form of Owner Acknowledgement of Agency Response Notice
Name:
Address of.Home:
Date:
I, (insert name) hereby acknowledge that I received the Agency
Response Notice (as described in Section 8 of the Resale Agreement on (insert
date).
By:
D -1
1552 \03 \583952 2
2207
'R
EXHIBIT E
Form of Request for Agency Approval of Improvements to the Home
To: Poway Redevelopment Agency ( "Agency ")
Prom:
Home Address:
Date:
( "Owner ")
( "Home ")
I hereby request Agency approval of the following capital improvements I intend to make to my
Home:
Description of
Estimated Cost:
Original Affordable Housing Cost:
The Agency will respond in writing to this request.
NOTE: Owner should retain copies of contracts, invoices, and receipts for all completed
capital improvements. These documents will be necessary to establish the resale restricted
price of the Home upon subsequent transfer.
*Notice: Proposed Improvements must cost at least Two Thousand Dollars ($2,000) or one
percent (1 %) of the original purchase price (whichever is greater) and must be approved by the
Agency in writing prior to construction.
155203 \583952 2
I:
2209
EXHIBIT F
Form of Owner Request for Agency Subordination
to Refinanced First Lender Loan
To: The Poway Redevelopment Agency ( "Agency ")
From: ( "Owner ")
Home Address: ( "Home ")
Date:
The Owner hereby requests the Agency to approve the Owner's refinance of the existing first
mortgage on the Home. The Owner provides the following information which it certifies to be
true and correct:
1. Original Affordable Housing Cost of 1 -lome: $
2. Original Principal Balance of exiting First Lender Loan: $
3. Interest Rate of Existing First Lender Loan: $
4. Principal Amount of Proposed New first Lender Loan: $
>. Interest Rate of Proposed New First Lender Loan: $
6. A copy of all loan documents related to the refinancing of the First Lender Loan.
The Owner hereby certifies the above information is true and correct and this Owner Request is
executed under penalty of perjury on [insert date[.
1552\03 \583952.2
By:
Owner
By:
Owner