§ 114-74. Homeowner contractual relationship with County.

1)

Prior to construction beginning, the homeowner(s) must execute a second mortgage and promissory note for the maximum amount of assistance which will be modified after final completion of work to unit to reflect the actual amount of funds expended.

a)

The secondary mortgage must be executed on the second mortgage document or on a substantially similar document that has been approved by the Collier County Attorney Office.

b)

Lenders may include, but not be limited to, Collier County Board of County Commissioners or any registered financial institution operating under the Laws of Florida in Collier County, Florida.

c)

The promissory note and the second mortgage shall set forth the obligations of the borrower(s), lender(s), mortgagor(s), and mortgagee(s) as approved by the County Attorney's Office.

d)

Mortgage dollar amount(s) shall be limited by and shall not exceed:

i)

Program guidelines as established by program grantors;

ii)

Bids for rehabilitation services as submitted by participating contractors.

e)

The second mortgage shall be recorded with the office of the Collier County Clerk of Courts upon closing of the rehabilitation loan with the Department and the homeowner.

f)

Upon closing, the Department will cover the costs of recordation of the mortgage instrument with the Collier County Clerk of Courts and documentary stamp tax.

g)

No final payment or disbursement of loan funds will be made or processed for the contractor until the Department receives a certified copy of the recorded second mortgage document.

h)

A copy of the second mortgage shall be maintained as part of the permanent program file for each homeowner(s) making application to the Collier County Owner Occupied Rehabilitation Program.

2)

Homeowner(s) is/are responsible for reporting any change of income to the Department within 30 days of any change so that closing of an owner occupied rehabilitation loan is not unduly delayed.

a)

Changes in individual, household, and/or family income shall require that "applicant income certification" be completed and recertified by homeowner(s). The Department shall verify all income certification and re-certifications using criteria established by the Department and as may be amended from time to time to reflect current loan and qualification standards.

3)

Third party verification shall be completed prior to closing an owner occupied rehabilitation loan and executing the second mortgage and the promissory note.

4)

Based on funding availability, certification of income and property eligibility, clients will be issued an award letter. The letter, at a minimum, will state the amount of the assistance, the terms of the assistance and contact information for Department staff and/or County representative/designee.

5)

A copy of the promissory note shall be maintained as part of the permanent program file for each homeowner accepting funds for the Collier County Owner Occupied Rehabilitation Program.

6)

Homeowner(s) must execute the Owner Occupied rehabilitation program performance program document.

7)

The performance agreement sets forth the obligations of the homeowner with regard to the facts and purposes of the program which includes, but is not limited to:

a)

That homeowner understands the conditions of the loan, including program guidelines, rules, and restrictions.

b)

That benefits are not transferable.

c)

That eligible dwelling units be occupied by the homeowner prior to and after completion of rehabilitation work to the dwelling unit.

d)

That the eligible dwelling unit must comply with the requirements of the Florida Building Code.

e)

No homeowner, co-owner or relative of an owner or co-owner shall serve as a contractor or subcontractor for the rehabilitation of the subject property, nor shall an owner, co-owner, or relative receive any compensation for their labor with any program funds.

f)

A relative of a homeowner or co-owner shall be defined in this instance as an immediate family member to include mother, father, brother, sister, aunt, uncle, and cousin or a family member by marriage, to include mother-in-law, father-in-law, brother-in-law, and sister-in-law.

g)

That all work performed by a contractor will be in accordance with the inspection report prepared by Collier County and/or its representative/designee and that no changes to bid work will be paid for with loan funds where there has not been express written prior approval by the Department director or his/her designee on the form entitled "Owner Occupied Rehabilitation Program Change Order."

h)

That access to the property and dwelling unit will be provided to County and/or its representative/designee conducting inspections to determine interim progress and/or completion of work for any or all rehabilitation work performed with funds from this program.

i)

That contractor is responsible for acquiring any and all permits and approvals to perform work under this program and must provide evidence of permits where requested, by County and/or its representative/designee, including but not limited to inspectors.

j)

That payment for any work performed prior to execution of the second mortgage, promissory note, or other approved instrument, including but not limited to, an official notice to proceed, shall not be the responsibility of the County.

k)

Liability for payment for any work performed by the contractor which does not conform to the work write-up where express written approval has not been given by the Department shall be the sole responsibility of contractor.

l)

Funds will be secured with a recorded fifteen (15) year, zero interest, deferred subordinate mortgage as further identified in the SHIP LHAP on the property in the amount of the subsidy used in the project. If all conditions of the loan are met, one-third of the loan will be forgiven in five-year increments so that at the end of the fifteenth year the loan is forgiven. Monthly payments are not required.

m)

That the homeowner shall occupy the rehabilitated residential unit as the primary residence until a satisfaction of mortgage for a period of 15 years or the terms of the second mortgage has been fulfilled, whichever comes first. If the homeowner does not fulfill the obligations identified, they shall be in default of this performance agreement, the required second mortgage, and the promissory note and repayment of the balance of the second mortgage shall become due and payable immediately.

n)

That the maximum amount of the loan shall be the actual amount paid to the contractor, or $30,000.00, whichever is less. The Department director may obtain approval of the Board of County Commissioners on a case by case basis for subsidies above the established levels to accommodate a special needs housing applicant or other situation in which it is determined that the assistance is necessary and/or not evident at time of bid.

8)

Historically Significant Properties:

a)

Improvements must be consistent with those approved by the Florida Department of State in accordance with the most current revision of "Secretary of the Interior's Standards for Rehabilitation and Guidelines for Rehabilitation of Historic Buildings," and

b)

Improvements must comply with the Collier County Historic/Archaeological Preservation Ordinance, Ordinance No. 91-70.

(Ord. No. 2014-29, § 4)