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HomeMy WebLinkAboutRes 02-04 01/20/2004 vwl 1/15/04 RESOLUTION 2-04 A RESOLUTION AMENDING RESOLUTION NO. 30-00 SUPPORTING THE CREATION OF THE FIRST-TIME HOMEBUYER'S ASSISTANCE PROGRAM WHEREAS, the corporate authorities of the Village of Mount Prospect determined that it was in the best interests of the Village to establish a First Time Homebuyer's Assistance Program ("the Program'); and WHEREAS, with the support of local/ending institutions, on September 5, 2000, with the passage of Resolution No. 30-00, a First Time Homebuyer's Assistance Program was established in the Village of Mount Prospect, as part of the 2000 Consolidated Plan; and WHEREAS, since the establishment of the Program, the Corporate Authorities of the Village of Mount Prospect have determined that it is in the best interests of the Village and first time homebuyers to allow applicants to utilize the services of lending institutions not exclusive to Bank One, as defined in the 2000 Homebuyer's Assistance Program guidelines. NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND BOARD OF TRUSTEES OF THE VILLAGE OF MOUNT PROSPECT, COOK COUNTY, ILLINOIS: SECTION ONE: That the Mayor and Board of Trustees do hereby authorize an amendment to the 2000 Homebuyer's Assistance Program Proposal allowing applicants to utilize the services of lending institutions not exclusive to Bank One, a copy of said proposal attached hereto and hereby made a part hereof as Exhibit "A". SECTION TWO: This Resolution shall be in full force and effect from and after its passage and approval in the manner provided by law. AYES: Corcoran, Hoefert, Lohrstorfer, Skowron, Wilks, ladel NAYS: None ABSENT: None PASSED and APPROVED this 20th day of January, 2004. ATTE~J ~ ~ Velma ~e, Village Clerk H : IC L K 0 Ifi I es I W I NIRE SIF i rs t Ti me H omeb uye rProg -Ame n d. d oc . . ~ . oj. . Village of . . . Mount Prospect . Canmunity Deœ/opment Block Grant Homebuyer's Assistance program Proposal 2000 Action Plan Amendment ~ \\ E'i-It i ~; t A II First-Time Homehuver's Assistance ProJ!ram - 2004 The Village's First-Time Homebuyer's Assistance Program provides loans to eligible applicants who purchase a home within Mount Prospect. The program assists low- and moderate-income homebuyers with down payment and closing cost assistance, which are the biggest constraints for a prospective buyer. This program is funded by Community Development Block Grant (CDBG) funds provided by the U.S. Department of Housing and Urban Development (HUD). Applicant Eligibility 1. The applicant must be a first-time homebuyer who has not owned a home in the past three years. Exceptions may be made for displaced homemakers. 2. Applicant's household income must not exceed applicable HUD-income limits. Property Eligibility 1. The property to be purchased must be located within the corporate limits of the Village of Mount Prospect. 2. Eligible properties are limited to single-family residences. This includes detached homes, condominiums, townhouses, coach houses and duplexes (with split ownership). 3. The property to be purchased must undergo a home inspection. This inspection cost is to be paid by the Village. 4. The property to be purchased must undergo a lead-based paint inspection if the home was built prior to 1978. This inspection cost is to be paid by the Village. 5. The property to be purchased must have a clear and free title. Housing Counseling Applicants must successfully complete a homebuyer counseling and training course prior to making an offer to purchase. The counseling sessions could include the following topics: . Selecting a home Understanding the buying process (including loan closing) Financial costs of home ownership Budgeting personal finances Home maintenance and repairs . . . . Terms of Assistance 1. Each applicant may receive up to a maximum of $10,000 to be used for down payment and closing cost assistance. 2. The amount of the First-Time Homebuyer's Assistance Program loan will be based upon the amount of the required down payment and closing costs. According to HUD guidelines, the Village can provide the following: . Up to 50% of the minimum down payment required by the lending institution; and . Reasonable closing costs 3. Applicant must provide a minimum of $1,000 for down payment costs. 4. The loan will be secured by a second mortgage recorded against the title to the property. The loan will be a O%-interest, deferred loan. The loan will be deferred for the affordability period of five years and will be forgiven at a rate of 1/60th per month over the five-year period. Recapture will be ensured by the execution and recording of a second mortgage stipulating the recapture requirement.