7.1 hrsr 11-06-2017 °>P1(t) ..,
htik ........„ Request for Action
River
To Item Number
Housing and Redevelopment Authority 7.1
Agenda Section Meeting Date Prepared by
General Business November 6,2017 Colleen Eddy, Economic Development Specialist
Item Description Reviewed by
HRA Housing Rehabilitation Loan Program Update Amanda Othoudt,EDD
Reviewed by
Cal Portner,City Administrator
Action Requested
1. Receive information on the HRA Housing Rehabilitation Loan Program.
2. Approve,by motion, one mortgage and repayment agreement.
Background/Discussion
Currently,there are three projects getting underway.
Twelve projects have been completed to date. Over$311,579 will soon be disbursed over the four-year
rehabilitation program period. Monthly installment payments are received per the agreements.
The mortgage and repayment agreement being requested for approval tonight is a binding agreement
between the homeowner and CMHP. Once the project is complete,the HRA will receive an executable
mortgage and repayment agreement,which will include truth in lending agreements and the amortization
schedule and any additional required documents.
Staff continues to work with CMHP on marketing efforts;which consists of purchasing Facebook ads,
print ads in the Star News,posting on social media sites and holiday cards.
Financial Impact
N/A
Attachments
• November Project/Financial Report
• Torfin Mortgage and Repayment Agreement
The Elk River Vision
A welcoming community with revolutionary and spirited resourcefulness, exceptional P o w E R E o 1Y
service, and community engagement that encourages and inspires pro rperity NATURE
2017 Elk River HRA Homeowner Rehab Program Monthly Project and Financial Report November 2017
Updated:10/30/17
Completed Projects
App.Date Name Project# Home Address Date Current Status Loan amount Loan rate Loan Lead Paint Recording Monthly
_Approved _ _ _tern inspect. .Fees Payment
Projects Under ConstructionJ
App.Date Name Project# Home Address Date Current Status Loan amount Loan rate Loan Lead Paint Recording Monthly
Proved , oect. ,,Fees Payment
138/15/2016 _Lang&Nancy Krieg _ER-14 _609 Gates Ave NW 8/19/2016 _sent docs.to recorders office 10/23/17 $19,665.00 2.75% 10 $596.00 _$46.00 $159.79
Proiects Ready for Construction
App.Date Name Project# Home Address Date Current Status Loan amount Loan rate Loan Lead Paint Recording Monthly
Approved term )i soect, fees Payment
14,4/13/2017 Linda&Daniel McClellan _ER-17 _810 Jackson Ave NW _4/21/2017 _sent Notice to Proceed 10/19/17 _$6,534.00 2.25% 5 650.00 _ 46.00 $115.24
,Projects Biddino/Waitino for Approved Scone
App.Date Name Project# Home Address Date Current Status Loan amount Loan rate Loan Lead Paint Recording Monthly
Approved I tern inspect. Fees Payment
1 15 7/25/2017 Kyle&Jennifer Torfin ER-18 1811 Main St.NW _7/31/2017 contracts mailed to contractor 10/23 _$21,640.00 14.25% _15 _$400.00 $46.00 _$162.79
Approved Ap lications
App.Date Name Project# Home Address Date Current Status Loan amount Loan rate Loan Lead Paint Recording Monthly
_ oved item _inspect, Fees _Payment
Projects Closed Applications
App.Date Name Project# Home Address Date Current Status Loan amount Loan rate Loan v Lead Paint 'Recording Monthly
'181/4/292117117 .irm ,inspect._ „Fees Payment
8/24/2017 Dianna Anderson ER-'18 430 Rush Ave NW ciosedapptication at manna's requesf11iz '
3/27/2015 Kara&Joe Holman ER-8 1028 Main St.NW v3/31/2015 file closed on 2/8/16
$567
8/20/2014 Lisa Conway +ER-2 x236 Norfolk Ave.NW 8/21/2014 lost contact closed 2/11/15 + ,,$567
8/5/16 David&Laura Hartfiel ER-13 1017 Main St.NW 8/9/2016 Dave asked to cancel his application 9/23/16
•
Four year total rehab funds below: I
$340,000
As of 10/30/17 Total loanamounts/rehab
funds: $311,579 ,, Total Ll $10,206_ I
Borrower Principal Interest Rehab balance: $18,215
Cunningham $1,151.33 $314.67 Additional contribution $50,000
Hanson $953.58 $246.43 Principle $67,547
Hicks $1,989.42 $1,109.27 Interest $7,870
Hoops $208.91 $143.46
Jungers $24,881.69 $472.15 Available to ioan
Krieg $142.56 $45.07 $143,632
Mahon $2,291.23 $118.61
Menning $3,694.36 $823.66
Olesen $2,788.21 $1,603.14
Sandhoefner $544.95 $170.63
Stimpson $4,088.92 $911.66
Swenson $2,812.14 $1,602.87
Thompson $22,000.00 $307.97
$67,547.30 $7,869.58
Mortgage and Repayment Agreement
(Elk River HRA Owner-Occupied Housing Rehabilitation Program)
g )
This mortgage is exempt from Mortgage Registration Tax imposed by Minnesota Statutes,
' �287.035'
pursuant to Minnesota Statutes,
§ ,because the principal amount of the mortgage loan referred
to herein is made under an affordable housing program and the mortgagee is the Housingand
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
20th day of October, 2017 (the "Effective Date"), by and between Kyle A. Torfin and Jennifer R. Torfin,
husband and wife (the"Owner")of the property located at 1811 Main St. NW, Elk River, MN 55330 and
Pro e
legally described as set forth in the attached Exhibit A(the" z
"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 otherood and
agree valuable consideration,the parties do hereby as follows: g
1. In accordance with the Elk River Owner-Occupied Housing Rehabilitation Policies and Procedures
(the"Procedures")and the Owner's Application dated July 25th,2017(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-One Thousand Six Hundred Forty and 00/100 ($21,640.00) Dollars. The
Installment Loan shall be disbursed directly to the contractor performing the work on the Property
described in the Application in accordance with the Proce
Procedures. The Owner agrees to repay to the
HRA in the Installment Loan plus interest thereon at the rate of 4.25%per annum in installments of
principal and interest of$162.79 per month,beginning on May 1St,2018 through
and including April 1St, 2033 (the "Final MaturityDate") in accordanceamortization
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.
If the HRA has not received the full amount of any monthly payment by the end of 10 calendar days
after the date it is due,the Owner will pay a late fee to the HRA. The late fee will' y
be 5.000%of the
overdue principal and interest payment.The Owner will pay this late fee promptly but only once on
each late payment.
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 livingorreason of
bythe 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.
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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 collectingthe Owner hereby same, and subject to the terms and
conditions of this Mortgage,
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 encumbr
Exhibit C. antes as set forth in
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
installment of principal or interest, or of any payment 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
retainhave the statutory power of
sale,and on foreclosure may statutory costs and attorney's fees.
6. For the protection of the HRA,the Owner will,duringall the time until
this mortgage is fullypaid, maintain the indebtedness secured by
ain all risk property insurance, naming the HRA as an additional
insured, in an amount not less than the full insurable replacement value
insurance shall be written bya company P a ue,of the Property. Said
p y 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), ut deduction for depreciation. The Owner will assign
and deliver the policies of such insurance to the HRA so and in such manner g
shall at all times, until the full payment of a and form that the HRA
said indebtedness, have and hold the said policies as a
collateral and further security for the payment of said indebtedness,or at the '
make such policies payable in case option of the HRA will
P Y of loss to the HRA as its interest may appear and will deposit
osit
them with the HRA,and in default of so doing,that the HRA may, but P
such insurance from year toyear,or for Y� has no obligation to,obtain
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
of the debtat the mortgage rate,and
that the same shall become a
part secured by this mortgage in like manner as the principal
sum. The Owner may retain any moneys received by him/her on the olicies p
apply in part payment of this mortgage. P , but the same shall
7. This Mortgage shall terminate and shall be of no further force or effect
Installment Loan and accrued interest thereon. upon payment in full of the
8. The Owner will indemnify, save, and hold harmless the HRA, the
Central Minnesota HousingPartnership,Inc., City of Elk River, Minnesota,
p, nc. their officers,agents,and employees,from and against
any claim,cause of action, damage, liability, loss or expense, includingattorney's
the HRA,made by any party in connection with or arising � s fees incurred by
arls�ng from(i)the presence,if any,of hazardous
wastes or pollutants on the Property;(ii)any loss or damage to property or any
any person occurring at or about or resulting fromp �any defect in the injury to or death of
Property, (iii)the performance
of, or failure to perform,this Mortgage. Nothing herein shall be deemed
limitations of liability or immunity.
a waiver of any statutory
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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 remedyshall not be a w
or remedy. aver of or preclude
the exercise of any right
11. This Mortgage shall be governed by the law of the state of Minnesota. In the event that '
or clause of this Mortgage conflicts with applicable any provision
pp a law, such conflict shall not affect other
provisions of this Mortgage which can be given effect without the conflictingprovision.
are declared to be To this
end,the provisions of this Mortgage
severable.
12. This Agreement may be executed in any number of counterparts,each of which shall constitute
and the same instrument. one
In witness whereof the Owner has duly executed this Rehabilitation Program Mortgage
Agreement. gand Repayment
Owner and Mortgagor:
47(--C .---C—
Kyle A. Torfin
,_.- .i_. ._ ,,e.:- /;'
Jennifer R.Torfin
STATE OF MINNESOTA)
)ss.
COUNTY OF(7ik-, .,,.\ )
The foregoing instrument was acknowledged before me this 2I da of x#06_ r7
Kyle A.Torfin and Jennifer R.Torfin,owner and mortgagor. y ,�� 'by
.
Notary Public
*Airi;:'; ., DONALD ALPHONES MOW
':`,p4.,
NOTARY PUBLIC-MINNESOTA
'' ''' MY COMM.EXPIRES 01131/2018
S-3
Accepted and agreed to by:
HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY
OF ELK RIVER
By
Its
By
Its
STATE OF MINNESOTA)
)ss.
COUNTY OF( )
The foregoing instrument was acknowledged before me this day of ,20 ,by
, the , and the
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
Notary Public
THIS INSTRUMENT DRAFTED BY:
Housing and Redevelopment Authority for the City of Elk River
13065 Orono Pkwy NW
Elk River, MN 55330
S-4
Exhibit A
Legal Description of Property
Real Property in Sherburne County, Minnesota,described as follows:
The East Half of Lot 2,all of Lot 3 and the West Half of Lot 4,Block 7,of the Townsite of Orono,
Sherburne County, Minnesota.
7.-Ae Le,94/ descopi-70,
/.5 cbrrec.-4-. ixrietz9
tou•rtY
RaDrdeci
A-1
Exhibit B
Amortization Schedule and Truth in Lending Statement
B-1
a
a
Loan Amortization Schedule
Enter values Instructions
Loan amount $ 21,640,00
Annual interest rate 4.250%,
Loan period in years 151
Start date of loan 5/1/2018
Optional extra payments
Scheduled monthly payment 1$ 162.79
Scheduled number of payments 180;
;
Actual number of payments 180
Total of early payments i $ -
Total interest r$ 7,662.75
Beginning Scheduled
No. Payment Date Balance Payment Extra Payment Total Payment Principal Interest Ending Balance
t
•
•
•
,
Beginning Scheduled
No. Payment Date Balance Payment Extra Payment Total Payment Principal Interest Ending Balance
.
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Beginning Scheduled
No. Payment Date Balance Payment Extra Payment Total Payment Principal Interest Ending Balance
-, - - -
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f - $ - .4 .. _ >
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4
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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
4.25% Installment Loan
Borrower(s): Kyle&Jennifer Torfin Project#: ER-18
Project address: 1811 Main St.NW 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
%4.25 $7,662.75 $21,640.00 $29,302.75
Your payment schedule will be:
Number of Payments Amount of Payments Due Date Monthly Starting
180 $162.79 1"of each month May I",2018
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$21,640.00
• Construction costs associated with rehabilitation 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.
-'-'..-T--
Borrower: Date: /3 ,.- l / 1
/ —
f ' ! ` •ii,/
Borrower: /{)/c,„-,,,,_ .' Date: / r,,, { ,, ,
Exhibit C
Permitted Encumbrances
None
C-1