Submitted By
Tammie Grossman, Director of Development Customer Services
Reviewed By
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Agenda Item Title
Title
A Resolution Authorizing Subordination Of A Lien For The Property Located At 1018 South Taylor Avenue (BPIP-024)
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Overview
Overview
The loan recipient is requesting a subordination of their Barrie Park Investment Program loan mortgage to a new first mortgage. The Village remains secure in junior position on the title.
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Recommendation
Recommendation
Approve the resolution
Fiscal Impact
There is no impact on the General Fund. Staff time to prepare the subordination and assignment are the only cost to the Village.
Background
On November 1, 2004 pursuant to the Barrie Park Investment Program, the Board of Trustees approved a $15,000 grant and a $15,000 loan to the owner of 1018 South Taylor Avenue. The loan is supported by a mortgage which was recorded against the property. The mortgage was recorded as a junior mortgage on the property with the purchase loan mortgage being in first position.
Loans made under the Barrie Park Investment Program are deferred for repayment until conveyance or transfer of any interest in the property. The program guidelines provide that in cases where former loan recipients wish to refinance mortgages other than the Village's, and request that the Village maintain its subordinate position, the Village will agree to maintain its junior position if:
a. The terms of new first mortgage are more advantageous to the homeowner and are reasonable under current market conditions; and
b. There is adequate equity in the property to support the total proposed encumbrance, at least 15% equity. (if necessary, homeowner(s) will submit an appraisal as proof of equity); and
c. The cost of the refinance is the only allowable equity taken out of the property.
In cases of extreme hardship, staff may recommend that the Board consider subordination when the homeowner is requesting cash ba...
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