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90-QQQQRESOLUTION NO. 90-d~q~ A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF BOYNTON BEACH, FLORIDA, AUTHORIZING AND DIRECTING THE MAYOR AND CITY CLERK TO EXECUTE A CERTAIN HOME IMPROVEMENT LOAN LEVERAGING AGREEMENT BETWEEN THE CITY OF BOYNTON BEACH, FLORIDA AND BARNETT BANK FOR THE PURPOSE OF THE IMPLEMENTATION OF THE CITY'S HOME IMPROVEMENT PROGRAM; A COPY OF SAID AGREEMENT BEING ATTACHED HERETO AS EXHIBIT "1"; PROVIDING AN EFFECTIVE DATE; AND FOR OTHER! PURPOSES. NOW, THEREFORE, BE IT RESOLVED by the City Commission of the City of Boynton Beach, Florida, that: Section 1. The Mayor and City Clerk are hereby authorized and directed to execute a certain Home Improvement Loan Leveraging Agreement, a copy of which is attached hereto as Exhibit "1". Section 2. This Resolution shall take effect immediately upon passage. PASSED AND ADOPTED this day of June, 1990. / CI'. BEACH, FLORIDA %TTEST: Ci~ Clerk Mayor Vice Mayor C6~m~S S ioner Commissioner (Corporate Seal) HOME IMPROVEMENT LOAN LEVERAGING AGREEMENT This Agreement, made this /~ day of ~(/~ , 1990, by and between the City of Boynton Beach (hereinafter referred to as "City"), and Barnett Bank (hereinafter referred to as "Lender"). Witnesseth: Whereas, the City desires to provide for financing to-low- and moderate- income homeowners for the purpose of rehabilitating their primary residences located in designated areas; and Whereas, the Lender is willing to provide home improvement loans to these homeowners upon the terms and conditions of this Agreement; and Whereas, both parties are committed to encouraging neighborhood reinvestment and community improvement; and Whereas, the public costs incurred by the City to originate a home improvement principal reduction loan will be substantially less if City funds are used in joint venture with a private lender. Now, therefore, the parties hereto agree as follows: I. COMMITMENT OF RESOURCES The Lender agrees to allocate sufficient funds to support any debt which the City recommends a need for financing. This matching of City resources by the Lender will be jointly reviewed by the City and Lender at regular periods to determine if more funds will be needed to me~t program demands. Page The City agrees to allocate sufficient resources to implement a Program providing funding to support Home Improvement Principal Reduction Loans. II. LOAN APPLICATIONS The Lender agrees to review and consider all loan applications referred to the Lender by the City's Community Improvement staff. The Lender will provide to City staff copies of all application forms to be used by the Lender in this program. The Lender will meet with City Community Improvement staff on a weekly or as-needed basis to discuss loan applications received and the desired actions. The Lender will assign staff to attend these meetings. The City will package the application materials for transmittal to the Lender. This package will include the following: Completed loan application form (form supplied by Lender) Complete property inspection form Completed work write-up & cost estimate from the contractor Commitment of City monies including effective interest rate and amount of public dollars. III. TERMS OF LENDER LOANS The Lender's rates and terms for home !mprovement loans are as follows: Term: Rate: Term: Rate: 1 - 5 years 12- percent fixed rate, straight amortization 6 - 8 years !2.25-percent fixed rate, straight amortization Page 2 Term: Rate: Term: Rate: 9 - 10 years 12.5-percent fixed rate, straight amortization 11 - 15 years 13-percent fixed rate, straight amortization Variable rate loans are prime plus 1.5 percent. These loans are not recommended for general~program use. These rates and terms shall' be honored by the Lender for a period of one year from date of agreement and renegotiated within 30 days of expiration date. Additionally, it is mutually agreed that after the first six(6) months of the contract, the City and Lender agree to review the contract and mutually agree upon any changes within the contract with regard to the total commitment and amount from the City and the Lender and the interest rate to be charged per the contract. IV. FEES TO BE CHARGED BY THE LENDER The parties hereby agree that reasonable fees may be charged by the Lender for originating and making rehabilitation loans. Such fees, wherever possible, will be included in the loan amount. Specifically, these fees will include: A $200-closing cost charge as a maximum per loan * Property insurance to be provided by homeowner Life & disability insurance as deemed necessary or requested The $50-service charge will be waived on each case. No additional fees over Two Hundred Dollars ($200.00) wiil except on a case-by-case basis and by mutual be charged agreement. Page 3 V. UNDERWRITING CRITERIA The Lender agrees to consider each application on a case-by- case basis. Standard underwriting criteria applied without flexibility will not always meet the program's purpose and intent. Therefore, the Lender and City agree to work as a team in reviewing each application p~ior to approval or disapproval by the Lender. VI. MARKETING OF PROGRAM The Lender agrees to work with the City in its marketing of the program. The Lender will attend meetings with City staff held in the community to explain the program. The Lender will provide additional marketing assistance when possible, including use of special cards, distribution of program brochures, applications and printing of materials. VII. STAFFING The Lender agrees to assign staff to work with the Home Improvement Program on a regular basis. This staff will include: Primary Contact: Support Contacts: Dale Griffin, VP/Loan Officer Keith Girten, VP/Branch Manager and Jessie Tomlinson, Loan Processor Address of these Lender representatives is: Barnett Bank 114 North Federal Highway P.O. Box 24644 Boynton Beach, Florida 33416-4644 407/732-7000 Page 4 VIII.LOAN INSTRUMENT The Lender will record a mortgage and security agreement for each loanr along with a Limitations of Right to Future Advance. The City will record a mortgage and security agreement for each loan. The payment on the City's loan will be deferred and will amortize over the fifteen-year period. No repayment of City subsidy will be required unless the terms and conditions associated with the City's subsidy are violated. The City's mortgage and security agreement will be in a junior position to that of the Lender~ IX. LOAN SERVICING The Lender is responsible for the servicing of the Lender's loan. The Lender will have no involvement in the servicing of the City's deferred payment loan. The City will work with the Lender on a case-by-case basis on those loans which become delinquent. 'The City's assistance will include meetings with the homeowner and referrals for financial counseling. The City's assistance will not include loan buy backs or guarantees. TIMING The Lender will begin participation in the program upon execution of this Agreement. This Agreement shall run for a period of 12 months with the right to renew by mutual consent for an additional 12 months. The Lender will process loans in a timely manner and expects loan~ closings within ten working days of receipt of an application package. Page 5 LOAN PROCESSING PROCEDURES The loan processing procedures outlined in the program guidelines and procedures manual are acceptable to both parties. Modifications will be made as deemed necessary by both parties during the program year. XII. AMENDMENTS The parties may amend this Agreement from time to time, but all such amendments shall be mn writing. XIIi.TERMINATION Either party may terminate this Agreement without cause with a thirty (30) day notice~ provided such termination not affect any loans outstanding or commitments to borrowers. In Witness Whereof; each party has caused their names to be smgned hereto by their respective officers, or signatories duly attested to be hereunto affixed as of ~he /~ day of ~zz~ 1990. Witnesses: / x BANK ~x~~cutive Vice President Page 6