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EXHIBIT J CITY OF SANTA ANA Neighborhood Stabilization Program Homeownership Program PROMISSORY NOTE Santa Ana, California 20 FOR VALUE RECEIVED, , the undersigned (`Borrower"), promises to pay to the City of Santa Ana, a charter city and municipal corporation ("Lender") at City Hall, 20 Civic Center Plaza, P.O. Box 1988, (M-25) Santa Ana, California 92702, or at such other address as Lender may direct from time to time in writing, Dollars ($ ) (the "Note Amount") together with interest thereon at the rate set forth herein. All sums hereunder shall be payable in lawful money of the United State of America and all sums shall be credited first to interest then due and the balance to principal. The obligation of the Borrower with respect to this Note is secured by that certain Deed of Trust Including Affordable Housing Deed Restrictions ("Deed of Trust"), executed by the Borrower concurrently herewith. Borrower shall be required to pay any and all service charges associated with the City Loan. This Note evidences the obligation of Borrower to Lender for repayment of funds loaned pursuant to California Redevelopment Law to finance the purchase of that certain real property (the "Property") located at , Santa Ana, California. 1. Interest Rate. Simple interest shall accrue in the Note Amount at a rate of Three (3%) per annum for forty-five (45) years, except as set forth below. 2. Payments/Maturity Date. For value received, the Borrower(s), jointly and severally, agree to pay the Lender, the total sum of $ with interest from , 20 , on unpaid principal at the rate of 3% per annum. All principal and interest shall be deferred until subsequent sale or transfer of the Property. The Deed of Trust will carry a 3% interest rate, and will be due and payable in forty-five (45) years. Interest will be forgiven at a rate of 1/45th per year, at each anniversary date of the original sale, with all interest forgiven at the end of the forty-five (45) year affordability period. After the expiration of the affordability period, the principal amount of the Note will be paid at transfer or sale. The balance of all unpaid principal shall be due and payable on the date forty-five years from the date hereof (the "Maturity Date"). Notwithstanding the foregoing, if on the Maturity date the Borrower has complied with this Note and the Deed of Trust (as such terms are defined below) and has not been in default under said documents, the amount owed pursuant to this Note shall be considered mature, so long as all principal and all related costs have been paid to the Lender. EXHIBIT 1 25D-86