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l:\word\genforms\preapp\rental\home\preapp.doc revised 5/10/99 1 DEPARTMENT OF PLANNING ANDCOMMUNITY DEVELOPMENT Housing & Community Development Division 809 CENTER STREET, ROOM 206, SANTA CRUZ, CA 95060 • 831/420-6250 • FAX 831/420-6458 UNIFIED HOUSING REHABILITATION PROGRAM HOME RENTAL REPAIR LOANS Thank you for your interest in the City of Santa Cruz Unified Housing Rehabilitation Program (UHRP). The following information describes how the program operates and what types of loans are available for repair of rental properties. What is the Unified Housing Rehabilitation Program? The purpose of the HOME Rental Repair Loan program is to assist owners of rental property serving low and very low-income tenants by providing low interest loans to repair and restore substandard and deteriorated units. The primary objective is to eliminate life threatening hazards and to correct health and safety problems. What kind of work is eligible? Eligible work includes repairs to foundations, roofs, electrical systems, plumbing, heating, windows, and doors. Abatement of hazardous materials such as lead-based paint and asbestos is eligible, energy conservation measures, modifications for handicapped accessibility, painting and some floor coverings also qualify. How do rental projects qualify for the program? Rental property owners qualify for assistance by agreeing to enter into a Regulatory Agreement and Grant of Interest in Real Property which ensures that HOME rents apply to units assisted with HOME funds. Rental property owners must rent to low-income households and the term of affordability ranges from 5 to 15 years, depending on the rehabilitation cost per units. Tenant income must conform with HOME requirements and must be verified annually. Project must show a positive cash flow and have a minimum of 20% equity after rehabilitation. What interest rate is applied to the loan? Funding is currently available from the Home Investment Partnerships Program (HOME) at 3% interest for rental rehabilitation projects. l:\word\genforms\preapp\rental\home\preapp.doc revised 5/10/99 2 What are the tenant income levels and maximum rent levels? In general, units in a property to be rehabilitated with HOME funds must be occupied by low or very-low income households whose total household income is no more than 60% of the HUD median income for the Santa Cruz County (PSMA). The following table illustrates the maximum amount that rental property owners can charge for their units after repairs are completed using HOME program funds. Maximum rents are set by the U.S. Department of Housing and Urban Development. Rent adjustments occur on an annual basis with the publication by HUD of updated median incomes. MAXIMUM HOME RENTS and INCOMES Effective January 1999 UNIT TYPE NUMBER OF OCCUPANTS ANNUAL MEDIAN INCOME 60% OF MEDIAN (LOW INCOME) MAXIMUM MONTHLY HOUSEHOLD INCOME MAXIMUM RENT* studio 1 $42,700 $25,650 $2,137 $673 1 Bedroom 2 $48,800 $29,300 $2,442 $723 2 Bedroom 3 $54,900 $32,950 $2,746 $870 3 Bedroom 4 $61,000 $36,600 $3,050 $996 4 Bedroom 5 $65,900 $39,550 $3,296 $1,092 5 Bedroom 6 $70,750 $42,450 $3,537 $1,186 6 Bedroom 7 $75,650 $45,400 $3,783 $1,281 Notes: 1. Figures are based on HUD Income Limits effective January 27, 1999 2. Maximum rent is determined by HUD and is revised on an annual basis. 3. Maximum rent includes utilities. Utilities are either paid directly by the property owner or a utility allowance determined by the Housing Authority must be deducted from the maximum rent shown. Are any grants available? Grants may be approved to assist with temporary relocation of tenants while construction is under way. Grants may also be available to pay for 50% of the cost associated with the abatement of asbestos or lead-based paint. In addition, for a limited time, an earthquake retrofit grant is available through other UHRP sources. This grant pays up to 50% of the cost of strengthening residential foundation systems for earthquake resistance. The grant is available to all owners of property located in the City. In some cases, program loans may be used to pay the balance of the costs. What happens after my application is approved? A UHRP construction specialist will meet with you to inspect your property and to discuss the work that needs to be done. A list of work items will be drawn up together with a preliminary estimate of the cost. Program staff will provide technical assistance in developing contract documents such as blue prints and construction specifications. l:\word\genforms\preapp\rental\home\preapp.doc revised 5/10/99 3 Who will do the work? The UHRP maintains a list of carefully selected, licensed building contractors. Most often bids are solicited from these contractors, and the contract is awarded to the lowest responsible bidder. In particular cases, when the owner has past experience with construction projects, and prefers to work with a particular contractor, program staff may approve management of the project on a streamlined basis which shifts a greater degree of responsibility for project development and management to the owner and contractor. Who supervises the work and how does the contractor get paid? Once construction is underway, UHRP staff and the owner closely monitor the project to ensure that the work is carried out in accordance with the plans and specifications. The contractor requests payment draws according to a prearranged schedule. The City issues a check to the contractor after the work has been inspected and approved by the owner and the City. How do I get started with my application? Attached is a preliminary application form. Please fill this out accurately and completely and return it as soon as possible. From the information you provide we will make an initial determination as to whether you may be eligible to participate in the program. If you have any questions, please call the UHRP at 420-6264. A program specialist will be happy to assist you. The City of Santa Cruz does not discriminate against persons based on race, color, religion, martial status, sex, national origin, ancestry, age familial status, disability, or any arbitrary basis. If you need special assistance with translation or communication in order to read and understand the information contained herein, please call the City of Santa Cruz at 831-420-5100. The City of Santa Cruz TDD is 420-5259 or call the Cal-Relay System at 800-735-2922. l:\word\genforms\preapp\rental\home\preapp.doc revised 5/10/99 1 D E P A R T M E N T O F P L A N N I N G A N D C O M M U N I T Y D E V E L O P M E N T Housing & Community Development Division 809 CENTER STREET, ROOM 206, SANTA CRUZ, CA 95060 • 831/420-6250 • FAX 831/420-6458 PRELIMINARY APPLICATION FOR HOME RENTAL REPAIR LOAN APPLICANT INFORMATION: Applicant’s name: _________________________________________________________ Co-applicant’s name: _________________________________________________________ Street address of property to be rehabilitated:_______________________________________________ (Must be within the City limits) Applicant’s mailing address:_____________________________________________________________ City: ___________________________________ State: _____________________ Zip: ____________ Phone: Home:____________________________________ Best time to call:_____________________ Work:____________________________________ Best time to call:_____________________ Are you the owner of the property to be rehabilitated: ¨ Yes ¨ No Do you live in the property to be rehabilitated? ¨ Yes ¨ No PROPERTY INFORMATION: Number of rental units on property: . . . . . . . . . . . . . . . . . . . ._______________ Year house was purchased: . . . . . . . . . . . . . . . . . . . . . . .______________ Current market value: ¨ Owner’s estimate ¨ Appraisal (date:_______) $_______________ Total outstanding debt against property: . . . . . . . . . . . . . . . . . $_______________ Estimated equity: . . . . . . . . . . . . . . . . . . . . . . . . . $_______________ Names on deed:_______________________________________________________________________ l:\word\genforms\preapp\rental\home\preapp.doc revised 5/10/99 2 REPAIRS NEEDED: Provide a brief description of the repairs needed. If you have a contractor’s estimate for the work, please include this. It is not necessary to have an estimate at this time. ____________________________________________________________________________________ ____________________________________________________________________________________ ____________________________________________________________________________________ ____________________________________________________________________________________ ____________________________________________________________________________________ ____________________________________________________________________________________ (Do not write below this line) Review date:__________________________________ Reviewed by:_____________________ Property located within city limits: ¨ Yes ¨ No Pre-rehab property value: $_________________________ Eight or more units: ¨ Yes ¨ No Davis-Bacon applies: ¨ Yes ¨ No Initial funding source: ¨ CDBG ¨ HOME Initial loan type: ¨ Grant ¨ Repayment Comments:_______________________________________________________________________________ _________________________________________________________________________________________ ___________________________________________________________________________
