Agenda 06/25/2013 Item #16D 96/25/2013 16.D.9.
11 EXECUTIVE SUMMARY
Recommendation to approve the adoption of the same Subordination Policy, forms and agreement
currently used under the State Housing Initiatives Partnership (SHIP) Program for all future State,
and Federal requests.
OBJECTIVE: To assist current Collier County low income homeowners to benefit from low interest rates,
thereby allowing them the ability to refinance their mortgages in order to keep their payments affordable.
CONSIDERATIONS: Housing, Human and Veteran Services (HHVS) provides affordable housing
assistance in the form of a loan to income qualified households that meet the requirements of the program.
Collier County is most often a subordinate lender to the first mortgage loan to the assisted property; for
example, SHIP and/or HOME Purchase Assistance provides interest free, deferred loans issued as a second
mortgage for the purchase of a home to qualified first -time homebuyers. Occasionally, homeowners want to
refinance their existing first mortgage to a lower interest rate, thereby allowing for a reduced monthly
payment to the homeowner. Subordinate lenders must either be repaid or agree to remain in a subordinate
lien position in order for the refinance to be completed.
On April 27, 2010, agenda item 16D11, the BCC approved a SHIP Local Housing Assistance Plan including
a Subordination Policy. On April 10, 2012, agenda item 16D3, the BCC approved an updated SHIP
subordination policy. This policy requires a rate/term refinance only and does not allow any cash to be
returned to the homeowner.
The other Federal and State grant programs administered by the County do not currently have an established
�1 BCC policy to address subordination requests received (specifically the HOME program), thereby not
providing applicants the opportunity to refinance their home loans in order to take advantage of the lower
interest rates available to them. Due to the similarities of the SHIP and the HOME Programs, with regard to
loan programs, staff recommends that the same Subordination Policy, forms and agreement currently used
under the SHIP Program be utilized for all future subordination requests in State and Federal grant programs.
If this item is approved, the aforementioned documents will be customized for each funding source but will
not deviate from BCC approved policy. The following funding sources may utilize the Subordination Policy
and backup documents: SHIP, HOME, CDBG, DRI, and NSP. Signature authority for the subordination
request will remain with the Interim Director of HHVS.
FISCAL IMPACT: The recording costs associated with the subordination agreement will be the
responsibility of the recipient. Therefore there is no fiscal impact associated with this item.
LEGAL CONSIDERATIONS: This item is approved as to form and legality and requires majority vote for
approval. -JAB
GROWTH MANAGEMENT IMPACT: Acceptance and implementation of this subordination policy will
further the Goals, Objectives, and Policies within the Housing Element of the Growth Management Plan.
RECOMMENDATION: To adopt the same Subordination Policy; forms and agreement currently used
under the State Housing Initiatives Partnership (SHIP) Program for all future State, and Federal requests.
Prepared By: Rosa Munoz, Grants Coordinator
Housing, Human and Veteran Services
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6/25/2013 16.D.9.
COLLIER COUNTY
Board of County Commissioners
Item Number: 16.16.D.16.D.9.
Item Summary: Recommendation to approve the adoption of the same Subordination
Policy, forms and agreement currently used under the State Housing Initiatives Partnership
(SHIP) Program for all future State, and Federal requests.
Meeting Date: 6/25/2013
Prepared By
Name: MunozRosa
Title: Grants Coordinator,Housing, Human & Veteran Services
5/15/2013 2:13:55 PM
Submitted by
Title: Grants Coordinator,Housing, Human & Veteran Services
Name: MunozRosa
5/15/2013 2:13:56 PM
Approved By
Name: MesaNancy
Title: Accountant,Housing, Human & Veteran Services
Date: 5/20/2013 8:46:08 AM
Name: SonntagKristi
Date: 5/27/2013 8:20:08 PM
Name: GrantKimberley
Title: Interim Director, HHVS
Date: 5/30/2013 4:24:09 PM
Name: AlonsoHailey
Title: Operations Analyst, Public Service Division
Date: 6/4/2013 9:38:47 AM
Name: BelpedioJennifer
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6/25/2013 16.D.9.
Title: Assistant County Attorney,County Attorney
Date: 6/4/2013 4:40:22 PM
Name: Joshua Thomas
Title: Grants Support Specialist,
Date: 6/10/2013 8:22:55 AM
Name: CarnellSteve
Title: Director - Purchasing/General Services,Purchasing
Date: 6/11/2013 4:11:55 PM
Name: BelpedioJennifer
Title: Assistant County Attorney,County Attorney
Date: 6/12/2013 9:21:09 AM
Name: KlatzkowJeff
Title: County Attorney
Date: 6/12/2013 1:50:42 PM
Name: FinnEd
Title: Senior Budget Analyst, OMB
Date: 6/13/2013 10:11:12 AM n
Name: StanleyTherese
Title: Management/Budget Analyst, Senior,Office of Manage
Date: 6/13/2013 1:55:04 PM
Name: OchsLeo
Title: County Manager
Date: 6/14/2013 4:47:07 PM
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6/25/2013 16.D.9.
Collier County
Housing, Human and Veteran Services Department
STATE/FEDERAL
SUBORDINATION POLICY
Requests for subordination must be approved in advance by the Housing, Human and Veteran Services
Department ( "Department "). We may consider subordinating our loan if the following factors are
present:
■ The proposed transaction is a rate and term refinance (less than $500.00 to borrower at
closing); and
• The new interest rate is a least one percent less than the current interest rate; and
• The new principal and interest payment is lower than the current payment; or if the new
monthly payment is increased due to a reduction to the term of the loan, the Department will
determine if the new payment is reasonable and beneficial to the client; and
• The proposed transaction only includes the current first mortgage payoff and reasonable closing
costs; and
• Closing costs are reasonable as determined by the Department; and
• The proposed transaction does not include a prepayment penalty.
• Property being refinanced must be the borrower's principal residence.
The following documents must be submitted to our office in order to process a subordination request:
1. Subordination Request form (attached).
2. Signed and executed Good Faith Estimate and Truth in Lending statement; and
3. Signed and executed mortgage /loan application; and
4. Preliminary HUD -1 Settlement Statement; and
5. Copy of title commitment; and
6. Name, phone number and email address of closing agent/Title Company.
Please allow 10 business days for processing from the date the request is submitted to our office. If
approved, the Department will notify the lender and title company prepare the Subordination
Agreement. If we are unable to approve the request, a payoff letter will be issued.
Priscilla Doria
Grant Coordinator
Housing, Human &- Veteran Services Department
3339 E. Tamiami Trail, Bldg H, Suite 211
Naples, Florida 34112
11-N Phone: 239 -252 -5312 E -fax: 239 -252 -6518 Email: PriscillaDoria @colliergov.net
Revised 05/2013
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CCA
6/25/2013 16.D.9.
Subordination Request Form
Complete the following form and fax to: (239) 252 -6518
Attn: Priscilla Doria
Borrower (s) name:
Borrower (s) address:
I
Name of Lender /Broker:
Address:
Emai l: Phone:
Current Mort a e Information
Principal Balance: Interest Rate:
Monthly Payment: Loan Term:
New Mortgage Information
Loan Amount: Interest Rate:
Monthly Payment: Loan Term:
I certify, that the above information is correct. I certify that there will be no cash out to the borrower, and no
other unsecured debt will be paid off (i.e., credit cards, automobile loans, etc.). I understand that the
subordination document prepared by Collier County will be invalid if that is the case.
Lender /Broker Signature Date Lender/ Broker Name Printed
❑ APPROVED- PREPARE SUBORDINATION
IKimberley Grant, Interim Director
❑ DENIED - PREPARE PAYOFF
Revised 05/2013
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Date
C-'A
Collier County
Housing, Human and Veteran Services Department
STATE/FEDERAL
SUBORDINATION POLICY
6/25/2013 16.D.9.
Requests for subordination must be approved in advance by the Housing, Human and Veteran Services
Department ("Department "). We may consider subordinating our loan if the following factors are
present:
• The proposed transaction is a rate and term refinance (less than $500.00 to borrower at
closing); and
• The new interest rate is a least one percent less than the current interest rate; and
• The new principal and interest payment is lower than the current payment; or if the new
monthly payment is increased due to a reduction to the term of the loan, the Department will
determine if the new payment is reasonable and beneficial to the client; and
• The proposed transaction only includes the current first mortgage payoff and reasonable closing
costs; and
• Closing costs are reasonable as determined by the Department; and
• The proposed transaction does not include a prepayment penalty.
• Property being refinanced must be the borrower's principal residence.
The following documents must be submitted to our office in order to process a subordination request:
I . Subordination Request form (attached).
2. Signed and executed Good Faith Estimate and Truth in Lending statement, and
3. Signed and executed mortgage /loan application; and
4. Preliminary HUD -1 Settlement Statement; and
5. Copy of title commitment; and
6. Name, phone number and email address of closing agent/Ttitle c- paYCompanv.
Please allow 10 business days for processing from the date the request is submitted to our office. if
approved, the Department will notify the lender and title company prepare the Subordination
Agreement. If we are unable to approve the request, a payoff letter will be issued.
Priscilla Doria
Grant Coordinator
Housing, Human & Veteran . Services Department
3339 E. Tamiami Trail, Bldg H, Suite 211
Naples, Florida 341.12
Phone: 239 -252 -5312 E -fax: 239 -252 -6518 Email: PriscillaDoria @colliergov.net
Revised 05/2013
Packet Page -915-
C
Subordination Request Form
Complete the following form and fax to: (239) 252 -6518
Attn: Priscilla Doria
Borrower (s) name:
Borrower (s) address:
Name of Lender /Broker:
Address:
Email:
Phone:
Principal Balance: Interest Rate:
Monthly Payment: Loan Term:
Loan Amount:
Monthly Payment:
Interest Rate:
Loan Term:
6/25/2013 16.D.9.
I certify that the above information is correct. I certify that there will be no cash out to the borrower, and no
other unsecured debt will be paid off (i.e., credit cards, automobile loans, etc.). I understand that the
subordination document prepared by Collier County will be invalid if that is the case.
Lender /Broker Sigmature Date Lender/ Broker Name Printed
❑ APPROVED- PREPARE SUBORDINATION
Kimberley Grant, Interim Director
Revised 05/2013
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❑ DENIED- PREPARE PAYOFF
Date
C�*
11*�
6/25/2013 16.D.9.
THIS INSTRUMENT PREPARED BY & RETURN TO:
NAME OF STAFF PERSON HERE
COLLIER COUNTY
HOUSING, HUMAN AND VETERAN SERVICES
3339 EAST TAMIAMI TRAIL, SurrE 211
NAPLES, FLORIDA 34112
SUBORDINATION AGREEMENT
KNOW BY ALL MEN THESE PRESENT: In consideration of $10.00 and other
good and valuable considerations, Collier County, Florida, hereby agrees that
it shall postpone and make junior and subordinate in all respects that certain
lien and /or assessments created, by and between Collier County, a political
subdivision of the State of Florida, through its Board of County
Commissioners, and ENTER NAME OF HOMEBUYER, A SINGLE MAN,
dated ENTER DATE HERE, and recorded in OR Book 4375, at Page 3531,
Public Records of Collier County, Florida. Said agreement pertains to the real
property described as follows:
ENTER LEGAL DESCRIPTION HERE:
Said agreement will be subordinate only to the mortgage executed by,
ENTER NAME OF BUYER HERE, A SINGLE MAN to NAME OF LENDING
INSTITUTION HERE, as first lien holder in the amount of $AMOUNT, being
executed on , 2013.
This agreement shall continue in full force and effect so long as ENTER
NAME OF HOMEBUYER HERE, A SINGLE MAN shall be indebted to the
above financial institutions and government agencies, and /or their assigns.
Approved as to form & COLLIER COUNTY
Legality
Jennifer A. Belpedio
Assistant County Attorney
STATE OF FLORIDA
COUNTY OF COLLIER
By: KIMBERLEY GRANT
As: INTERIM DIRECTOR
OF HOUSING, HUMAN &
VETERAN SERVICES DEPARTMENT
Pursuant to the Subordination
Policy contained with the SHIP
Local Housing Assistance Plan
Approved by the Board on April 27,
2010, Agenda Item No. 15D11
The foregoing instrument was acknowledged before me on this day
of — 2013, by KIMBERLEY GRANT, as
INTERIM DIRECTOR of HOUSING, HUMAN & VETERAN SERVICES OF
COLLIER COUNTY and who is personally know to me.
* *NOTARY SEAL **
NOTARY SIGNATURE
�., PRINTED NOTARY NAME
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