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HomeMy WebLinkAbout80-491 07-08-1980RESOLUTION NO. 491 A RESOLUTION GRANTING APPROVAL TO THE TARRANT COUNTY HOUSING FINANCE CORPORATION FOR THE USE OF PROCEEDS OF ITS SERIES 1980 SINGLE FAMILY MORTGAGE REVENUE BONDS FOR ACQUIRING HOME MORTGAGES RELATED TO HOMES WITHIN THE CITY. WHEREAS, the creation. of.the Tarrant County Housing Finance Corporation, pursuant to the Texas Housing Finance Corporations Act, was approved by resolution of the governing body of Tarrant County, adopted on the 14th day of April, 1980, to provide a means of financing the cost of residential ownership and development that will provide decent, safe and sanitary housing for residents of the County at prices they can afford, and WHEREAS, the Corporation has the power under the Act to issue its bonds, the aggregate principal amount of which issued in any calendar year shall not exceed the total of (a) the costs of issuance of such bonds, any reserves or capitalized interest required by the resolution or resolutions authorizing the bonds, plus any bond discounts, and (b) the greater of (i) $20,000,000, (ii). a figure 'determined by multiplying $150 times the population of the County as determined by the Corporation's bonds, or financing documents relating to such issuance, or (iii) an amount equal to 25 percent of the total dollar amount of the market demand for home mortgages during such calendar year as determined by the Corporations' rules or regulations, resolutions relating to the issuance of bonds, or financing documents relating to such issuance, to defray, in whole or in part, the costs of purchasing, or funding the making of home mortgages, and WHEREAS,. the Board of Directors of the Corporation has requested the approval of the governing body of the City to acquire home mortgages related to homes within the City with the proceeds of a Series 1980 Single Family Mortgage Revenue Bond issue. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF EULESS, TEXAS, THAT: The governing body of the City hereby grants its approval to the Corporation for.the use of proceeds of the Bonds for acquiring home mortgages related to homes within the City. To indicate the City's desire to participate in this program, a copy of this resolution will be forwarded to the Tarrant County Planning Department. ADOPTED AND APPROVED this 8th day of July, 1980, at a regular meeting of the City Council of the City of Euless, Texas. APPROVED: 7 ATTEST ;. - Mayor City Secretary 2 TARRANT COUNTY HOUSING FINANCE CORPORATION PRELIMINARY MORTGAGE PURCHASE PROGRAM OUTLINE 1. Bond issue size: Between $50 and $200 million, of which approximately- 85% will be used to purchase mortgages. (The balance will be used to fund reserves and pay bond financing costs). The final size will be determined after the Corporation receives commitment requests from mortgage lenders. The issue is subject to Federal legislation currently pending in Congress and, under Texas law, cannot exceed 25 percent of the area's mortgage market as determined by a survey to be conducted. 2. Maximum income of borrower: $35,000 adjusted gross income in 19 9 as defined ?or Federal income tax purposes and as docu- mented by a 1979 tax return or other evidence satisfactory to lender. 3. Maximum purchase price: $85,000 4. Maximum loan amount: $75,000 5. Single loan per borrower: No borrower may have more than one mortgage oan From the Corporation at a given point in time. 6. Proportion of new construction and existing housing: Loans will be made on a first -come, first -serve basis o`n new or existing housing. Financing of rehabilitated housing is excluded. 7. Geographical area: Loans may be made on property anywhere in Tarrant County, excluding the City of Fort Worth, subject to the approval of cities with populations over 20,000. 8. Eligibility of mortgage lenders: Participant shall have maintained an office in the County continuously since January 1, 1980 and will be, (i) at the time of the origina- tion of any Mortgage Loan for Purchase by Issuer which has FHA Insurance, and at all times thereafter so long as Participant shall continue to serve in the capacity con- templated under the terms of the Agreements, a FHA- approved mortgagee and a FNMA or FHLMC- approved servicer of FHA- insured mortgages, (ii) at the time of the origination of any Mortgage Loan for Purchase by Issuer which has a ALA Guaranty and at all times thereafter so long as Participant shall continue to serve in the capacity contemplated under the terms of the Agreements, an eligible lender for mortgages Miscellaneous Fees - Appraisal fees, title fees, attorney's fees, credit report fees and other closing costs not set by the Corporation may be charged by the lender as long as they are "reasonable and customary ". Servicing Fee - Lenders will receive a 3/8% annual servicing fee for servicing the mortgage loan, such fee being withheld ratably from the monthly remittances of collected payments. 22. Loan administration: Loans must be serviced by the origi- ns it ng lender. 23. Delivery of Mortgage Loans: Loans will be delivered by the originating lender to tie Corporation on or before a date one year after delivery date (issuance) of the bonds. The Trustee bank will purchase the loans (including any accrued interest) without recourse on behalf of the Corporation after the Administrator has determined that the loans have been made in accordance with the Corporation's contractual requirements. The Corporation will make a good faith effort to purchase loans within ten business days after complete delivery. 24. Representation and warranties: Upon delivery of the mortgage loans to the Trustee bank, the participating lender must sign a document containing customary FHLMC /FNMA representations and warranties, plus other representations and warranties pertaining to the Corporation as a public instrumentality. 25. Commencement of Applications: Applications for mortgage loans cannot 6e accepted by Participants until the Corporation advises Participants that bonds have been sold and the mortgage interest rate has been established. guaranteed by VA and a FNMA or FHLMC- approved servicer of VA- guaranteed mortgages, and (iii) at the time of the origi- nation of any conventional Mortgage Loan for Purchase by Issuer, and at all times thereafter so long as Participant shall continue to serve in the capacity contemplated under the terms of the Agreements, a FNMA or FHLMC - approved seller and servicer of conventional mortgages, or an institution, the deposits of which are insured by FDIC or FSLIC, or having a minimum capital of $250,000. 9. Loan underwriting standards: All lenders must conform to Federal Home Loan Mortgage Corporation (FHLMC) or Federal National Mortgage Association (FNMA) loan underwriting standards, as applied by private mortgage insurance (PMI) com- panies on all loans. On FHA /VA loans, FHA /VA standards apply. 10. Types of property qualifications: One family, owner - occupied detache7 or attached residences (excluding trailers, mobile homes and condominiums). "De minimus PUDs" are permitted if they meet FNMA or FHLMC guidelines and (i) no commitment may be made on a unit of a planned unit development until at least 51% of the units in such planned unit development have been sold, and (ii) no more than the lesser of twenty -five units or 25% of the units of any one planned unit development may be the-subject of Mortgage Loans originated under the Program. 11. Sub - commitments of funds: The Corporation will not allow builder, realtor or developer sub- commitments. 12. Refinancing: The Corporaiton will not purchase a mortgage which refinances a borrower's existing permanent mortgage loan. 13. Assumptions: Assumptions a,ra permitted. However, on conven- tional loans, the assumptor must meet the 1979 income limit and owner - occupied requirements of the program. 14. Prepayments of loan principal (curtailments): Prepayments will be allowed at anytime; prepayment penalities on conven- tional mortgage loans bearing interest of 10% or less shall be: 4% - 1st year; 3% - 2nd year; 2% - 3rd year; and 1% - 4th year. No prepayment penalities may be charged on FHA or VA loans. 15. Loan- to -value ratio: (i) uninsured loans - up to 80 %, (ii) loans insured b private mortgage insurers - up to 95% and,. (iii) loans FHA /VA insured, to the extent of insured coverage (up to 97% FHA; up to 100% VA). On VA loans, the amount of cash down payment plus the amount of VA guarantee must be at least equivalent to 25% of the selling price or the appraisal value whichever is less. -2- 16. Type of loans: FHA- insured (except Section 245); VA guaranteed; conventional with PMI insurance if less than a 20% down payment, or uninsured if 20% or more down payment. There will be no specific allocation required as between conventional, FHA and VA mortgage loam ;. 17. Loan term: All mortgage loans must have a term of 30 years with substantially level monthly amortization. 18. Loan interest rate: To be established at the completion of the bond sale. 19. Mortgage insurance: (i) If the borrower makes less than 20% down payment, primary coverage must be provided by FHLMC- approved PMI, FHA, or VA (premium paid by borrower) and (ii) on the entire portfolio of loans purchased by the Corporation, there will be mortgage pool insurance equal to 10% of the original principal amount of loans insured, to cover extraordinary losses not covered by primary insurance (premium paid by Corporation). 20. Minimum Commitment to Lenders: Commitment allocations to qualified lenders win be for a minimum of $1,000,000 in mortgage loans purchased (exclusive of accrued interest) per lender. 21. Fees and charges: There are a total of three and one- quarter (3-I /`percentage points (based on commitment /loan amounts) plus normal closing costs under the program. Two and one - quarter (2 -1/4) points are paid to the lender by the seller and borrower at the time of loan closing. These fees and charges are designated as follows: Commitment Fee - A 2% (of the total commitment amount) fee will be paid by participating lenders to the Corporation at the time of the mortgage purchase commitment. Program Participation Fee - A fee, not to exceed 2% of the original principal amount of the mortgage loan, may be charged by Participants, as permitted by law, to sellers of residences. This fee represents reimbursement to the Participants of their Commitment Fees. Loan Origination Fee - a fee not to exceed 1% (of loan amount) on FHA /VA loans (or 1 -1/2% in the case of conven- tional loans) may be charged by the lender to either the borrower or the seller (or split between the borrower or seller at their discretion). Warehousing Fee - a 1/4 of 1% (of loan amount) fee may be charged by the lender to either the borrower or the seller as long as the loan interest rate is equal to or below the prime interest rate charged by The Fort Worth National Bank. - 3-