4.3. HRSR 05-02-2016 hi Request for Action
River
To Item Number
Housing and Redevelopment Authority 4.3
Agenda Section Meeting Date Prepared by
Consent Agenda May 2, 2016 Amanda Othoudt, EDD
Item Description Reviewed by
Satisfaction of Mortgage Agreement. Cal Portner, City Administrator
Reviewed by
Action Requested
Approve,by motion, the satisfaction of mortgage for real property located at 1021 4th Street NW.
Background/Discussion
On April 7, 2014,the HRA,by general consensus, agreed to fund the new housing program at$100,000
per year, for the next three years under contract with CMHP. The HRA Rehabilitation Loan Program
was approved at the May 5, 2014, HRA general meeting.
The goal of the program is to address renovations or repairs to an existing structure which materially
preserve or improve the basic livability, safety, or utility of the property.
Scott and Cynthia Thompson received$22,000 in funding through the HRA Rehabilitation Loan program
facilitated by the Central Minnesota Housing Partnership. The funds were used to make interior and
exterior repairs to the property.The HRA entered into a Mortgage and Repayment Agreement on April
6, 2015. On September 3,2015 the project was completed and the loan was closed.
The Thompsons paid off the loan with the HRA and are requesting a satisfaction of mortgage be signed
and recorded releasing them of all obligations under the Mortgage and Repayment Agreement.
Financial Impact
The Thompsons overpaid the balance of their loan by$154.21. Upon approval of the satisfaction of
mortgage, the overage will be refunded.
Attachments
• Mortgage&Repayment Agreement
• Satisfaction of Mortgage
r NATUR
Office of the County Recorder
Sherburne County,MN
Doc. No. 808930
Certified, Filed, and/or recorded on
August 28, 2015 11:00 AM
EXEMPT Mich Ile e, County Recorder
il'ATION TAX.
SHERBURNF COUNTY
AUDI T 0jl i RE, SLAHEt By Deputy
Fees: $46.00
-411 1111111 IIII
808930
Mortgage and Repayment Agreement
(Elk River HRA Owner-Occupied Housing Rehabilitation Program)
This mortgage is exempt from Mortgage Registration Tax imposed by Minnesota Statutes,§287,035,
pursuant to Minnesota Statutes,§287.04,because the principal amount of the mortgage loan referred
to herein is made under an affordable housing program and the mortgagee is the Housing and
Redevelopment Authority in and for the City of Elk River,a Minnesota body corporate and politic.
THIS MORTGAGE AND REPAYMENT AGREEMENT(this"Mortgage"), is made and entered into this
13th Day of March,2015 (the"Effective Date"),by and between Scott Thompson and Cynthia Thompson,a
married couple(the"Owner")the owner of the property located at 1021 4`h St.NW,Elk River,MN 55330,
and legally described as set forth in the attached Exhibit A (the "Property") and the Housing and
Redevelopment Authority in and for the City of Elk River,(the"HRA"),having its principal office at 13065
Orono Pkwy NW,Elk River,MN 55330.
NOW THEREFORE, in consideration of the Installment Loan described below and for other good and
valuable consideration,the parties do hereby agree as follows:
I. In accordance with the Elk River Owner-Occupied Housing Rehabilitation Policies and Procedures
(the"Procedures")and the Owner's Application dated August 21st,2014(the"Application"),both
of which are incorporated herein by reference as if fully set forth herein, the HRA has agreed to
make to Owner a Housing Rehabilitation Loan, (the"Installment Loan"), relating to the Property,
in the amount of Twenty-Two Thousand and 00/100($22,000.00). The Installment Loan shall be
disbursed directly to the contractor performing the work on the Property described in the Application
in accordance with the Procedures.The Owner agrees to repay to the HRA in the Installment Loan
plus interest thereon at the rate of 2.25% per annum in installments of principal and interest of
$204.90 per month,beginning on October lg',2015,through and including September 1 2015
(the"Final Maturity Date")in accordance with the amortization schedule and the Truth in Lending
Statement signed by Owner both attached as Exhibit B. The Owner may prepay the Installment
Loan in whole,together with accrued interest thereon,to the HRA on any business day.
2. Owner covenants and agrees with the HRA that if the Property is transferred or otherwise conveyed,
voluntarily or involuntarily,either while the Owner is living or by reason of the death of the Owner
prior to the Final Maturity Date, the Installment Loan and all accrued interest thereon shall be
immediately due and payable and shall be repaid in full to the HRA.
3. As security for Owner's obligation to repay the Installment Loan and accrued interest thereon, and
the cost, including reasonable attorney's fees,of collecting the same,and subject to the terms and
conditions of this Mortgage,Owner hereby grants,and HRA shall and hereby does have,a statutory
mortgage on the Property in accordance with Minnesota Statutes,Section 507.15.
4. The Owner covenants with the HRA the following statutory covenants;
a, To warrant the title to the Property; subject to permitted encumbrances as set forth in
Exhibit C.
b. To pay the indebtedness as herein provided.
c. To pay all taxes.
d. That the Property shall be kept in repair and no waste shall be committed.
e. That the whole of the principal sum shall become due after default,in the payment of any
installment of principal or interest, or of any tax, or in the performance of any other
covenant,at the option of the HRA.
f. To pay principal and interest on prior mortgages.
5. If default be made in any payment or covenant herein,the HRA shall have the statutory power of
sale,and on foreclosure may retain statutory costs and attorney's fees.
6. For the protection of the HRA,the Owner will during all the time until the indebtedness secured by
this mortgage is fully paid,maintain all risk property insurance,naming the HRA as an additional
insured, in an amount not less than the full insurable replacement value of the Property. Said
insurance shall be written by a company or companies licensed to do business in Minnesota and
rated Class A-:VII or better by A.M. Best Company. The term"full insurable replacement value"
shall mean the actual replacement cost of the Property(excluding foundation and excavation costs
and costs of underground flues,pipes,drains,and other items customarily omitted from replacement
cost valuation for insurance purposes), without deduction for depreciation. The Owner will assign
and deliver the policies of such insurance to the HRA so and in such manner and form that the HRA
shall at all times, until the full payment of said indebtedness,have and hold the said policies as a
collateral and further security for the payment of said indebtedness,or at the option of the HRA will
make such policies payable in case of loss to the HRA as its interest may appear and will deposit
them with the HRA,and in default of so doing,that the HRA may,but has no obligation to,obtain
such insurance from year to year,or for one or more years at a time,and pay the premiums therefor,
and that the Owner will forthwith repay to the HRA the same,with interest at the mortgage rate,and
that the same shall become a part of the debt secured by this mortgage in like manner as the principal
sum. The Owner may retain any moneys received by him/her on the policies, but the same shall
apply in part payment of this mortgage.
7. This Mortgage shall terminate and shall be of no further force or effect upon payment in full of the
Installment Loan and accrued interest thereon.
8. The Owner will indemnify, save, and hold harmless the HRA,the City of Elk River, Minnesota,
Central Minnesota Housing Partnership,Inc.,their officers,agents,and employees,from and against
any claim,cause of action,damage, liability,loss or expense, including attorney's fees incurred by
the HRA,made by any party in connection with or arising from(i)the presence,if any,of hazardous
wastes or pollutants on the Property;(ii)any loss or damage to property or any injury to or death of
any person occurring at or about or resulting from any defect in the Property,(iii)the performance
of,or failure to perform,this Mortgage. Nothing herein shall be deemed a waiver of any statutory
limitations of liability or immunity.
9. This Mortgage shall run with the aforesaid real estate and shall inure to the benefit of and be binding
upon the parties hereto and their respective heirs,executors,representatives,successors,and assigns.
10. Any forbearance by the HRA in exercising any right or remedy shall not be a waiver of or preclude
the exercise of any right or remedy.
II. This Mortgage shall be governed by the law of the state of Minnesota. In the event that any provision
or clause of this Mortgage conflicts with applicable law, such conflict shall not affect other
provisions of this Mortgage which can be given effect without the conflicting provision. To this
end,the provisions of this Mortgage are declared to be severable.
12. This Agreement may be executed in any number of counterparts,each of which shall constitute one
and the same instrument.
In witness whereof the Owner has duly executed this Rehabilitation Program Mortgage and Repayment
Agreement.
Owner and Mortgagor:
Scott Thompson
Cya Thompson
STATE OF MINNESOTA)
)ss.
COUNTY OF(Gila,A f' )
The foregoing instrument was acknowledged before me this Pi. day of ire-t ,206-,by
Scott Thompson and Cynthia Thompson,Owner and Mortgagor.
ei4„,./67
teNtic, DAVID DEAN CLARK �.•�.
ifirly- NOTARY PUBLIC MINNESOTA Notary Public
My Commission Expires Jan.31.2019
s-1
Accepted and agreed to by:
HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY
OF ELK ' . ER
By . ' /�i2,
Its Li - 1
By '��.w..�_ I
Its ffe'l' c�►(° �� i�
STATE OF MINNESOTA)
)ss.
COUNTY OF(.. 1)e°7,6 ,-/2e.
sf-f1
The foregoing instrument was acknowle ged before me this Li ~day of • j/,d ,20/5,by
et/j'L!,t � `� the f 77/ and 67, 12 .i , ",r I t , the
'F?(tr liti ft ci/i✓,respectively, of the Housing and Redevelopment Authority in and for the City
of Elk River,a body corporate and politic organized and existing under the Constitution and laws of the State
of Minnesota,on behalf of said Authority
o .r '
DEBORAH KAY HUEBNER
NOTARY PUBLIC-MINNESOTA
My Commission Ekes Jan.31,2020
THIS INSTRUMENT DRAFTED BY:
Housing and Redevelopment Authority for the City of Elk River
1 3065 Orono Pkwy NW
Elk River,MN 55330
S-2
Exhibit A
Legal Description of Property
Real Property in Sherburne County,Minnesota,described as follows:
Lot 4,Block 1,Houlton's Addition,Sherburne County,Minnesota.
A-1
Exhibit 8
Amortization Schedule and Truth in Lending Statement
B-1
Loan Amortization Schedule
Enter values Instructions
Loan amount $ 22,000.00
Annual interest rate 2.250%
Loan period in years 10
Start date of loan 10/1/2015
Optional extra payments
Scheduled monthly payment '$ 204.90 ,
Scheduled number of payments 120'',
Actual number of payments 120;
Total of eorly payments $
Total interest j$ 2,588.27
Beginning Scheduled
No. Payment Date Balance Payment Extra Payment Total Payment Principal Interest Ending Balance
t �nr 14 93 11:3 u,
v z t
lc 34 v Y:6,3 y
•
{
Beginning Scheduled
No. Payment Date Balance Payment Extra Payment Total Payment Principal Interest Ending Balance
'mot 4
, r
_ i.
- 1 - P'
, -
Beginning Scheduled
No. Payment Date Balance Payment Extra Payment Total Payment Principal Interest Ending Balance
Elk River HRA Homeowner Rehabilitation Program
Truth in Lending Statement
2.25% Installment Loan
Borrower(s): Scott&Cynthia Thompson Project#: ER-3
Project address: 1021 4th St.NE Elk River,MN 55330
Annual%Rate Finance Charge Amount Financed Total of Payments
The cost of your credit Dollar amount the Amount of credit Amount you will have
as a yearly rate credit will cost you provided to you on paid after you have made
(total interest) your behalf all payments as scheduled
2.25% $2,588.27 $22,000.00 $24,588.27
Your payment schedule will be:
Number of Payments Amount of Payments Due Date Monthly Starting
120 $204.90 1St of each month October 1st,2015
Security: You are giving a security interest in the property to improve
Prepayment: If you pay off early,you will not have to pay a penalty
Assumption: Someone buying your property cannot assume the remainder of the repayment agreement on the
original terms
See your contract documents for any additional information about non-payment,default,any required prepayment in
full before the schedule date,and prepaying refunds and penalties.
Itemization of the Amount Financed of$22,000.00.
• Construction costs associated with project
The makers,guarantors,endorsers and any other parties to this Note hereby waive presentment,demand,protest and
notice of dishonor and protect and hereby agree that an extension or extensions of the time of payment of this Note
or any installment or part hereof may be made before,at or after maturity by agreement with any one or more of the
parties hereto with out notice to and without releasing the liability of any other party to this Note.
By executing this Note,the undersigned acknowledge receipt of a copy thereof prior to execution.
—
Borrower: )4 Date: O _.15
Borrower: L t �' Date:
Exhibit C
Permitted Encumbrances
None
c-I
SATISFACTION OF REPAYMENT AGREEMENT
DATE:
THAT CERTAIN GRANT AGREEMENT owned by the undersigned,dated the 19th day of March,_
2015,executed by Scott Thompson, a single person as Mortgagor,to the Housing and Redevelopment
Authority in and for the City of Elk River, as Mortgagee and filed for record the 28th day of August,2015,
as Document Number 7808930, in the Office of the County Recorder of Sherburne County, Minnesota, is,
with the indebtedness thereby secured, fully paid and satisfied.
City of Elk River
By:
Its:
STATE OF MINNESOTA )
) ss
COUNTY OF )
The foregoing instrument was acknowledged before me this day of ,20
By, , the of the City of
Elk River.
NOTARIAL STAMP OR SEAL(OR OTHER TITLE OR RANK)
Notary Public
THIS INSTRUMENT WAS DRAT 1.D BY: TAX STATEMENTS FOR THE REAL PROPERTY DESCRIBED
City of Elk River IN THIS INSTRUMENT SHOULD BE SENT TO:
13065 Orono Parkway
Elk River, MN 55330 Unaffected