Item 27 - Fiscal Year 2023-24 Annual Action Plan and Budgets for CDBG, HOME, and

Home Browse Search

Annual Action Plan 2023 64 OMB Control No: 2506-0117 (exp. 09/30/2021) as follows: The City of Santa Ana does not use HOME funds in any other manner other than those described in Section 92.205(b). 2. A description of the guidelines that will be used for resale or recapture of HOME funds when used for homebuyer activities as required in 92.254, is as follows: The City incorporates a recapture requirement into written agreements and long-term affordability covenants for homebuyer assistance activities administered by the City as required by 24 CFR 92.254. For any homebuyer assistance activity implemented by subrecipients or CHDOs, this recapture requirement shall also be used. HOME affordability requirements are imposed based on the amount of direct HOME subsidy pursuant to HUD regulations as follows: Assistance under $15,000: 5-year affordability period Assistance between $15,000 - $40,000: 10-year affordability period Assistance over $40,000: 15-year affordability period The amount subject to recapture is the direct HOME subsidy received by the homebuyer. Direct HOME subsidy includes the HOME investment that enabled the homebuyer to purchase the property. This includes down payment assistance, closing costs, or other HOME assistance provided directly to the homebuyer and/or the difference between the fair market value of the property (as determined by appraisal) and a reduced sales price attributable to HOME development assistance. The recapture provision ensures that the entire amount of the City's direct HOME subsidy to homebuyers is recaptured if the housing does not continue to be the principal residence of the family for the duration of the applicable period of affordability (e.g., the home is sold, the home is foreclosed, the assisted owner is no longer residing in the assisted residence, or for any other breach of the agreement with the City). The HOME-assisted homebuyer may sell their unit at any time during the period of affordability, to any willing buyer, and at the price the market will bear. The recapture provision requires that the City’s direct HOME subsidy and any interest due under the HOME loan (that has not previously been repaid) is returned to the City from net proceeds first, subject to the limitation that if there are no net proceeds or the net proceeds are insufficient to repay the HOME investment due, the City may only recapture the net proceeds, if any. Net proceeds are defined as the sales price minus superior loan repayment (other than HOME funds), and any closing costs. In the event of a mortgage default, a provision in the written agreement and long-term affordability EXHIBIT 1