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Draft Exhibit B-11 <br /> Program Overview <br /> The City of New Brighton(City) is making funding available for the establishment of a Home <br /> Improvement Loan Program. This program is designed to supplement existing loan programs <br /> available from MHFA, CEE,private lenders and other housing resources. It is not intended to be <br /> the sole source of home rehab funds available to the City. The following sections list the <br /> guidelines and regulations for this program. <br /> Terms of the City's Revolving Loan Fund <br /> The intent of the Home Improvement Loan Program is to access existing funding sources (such <br /> as MHFA, CEE, etc) whenever possible so as to reserve City funds for applicants who do not <br /> qualify through traditional funding sources. With this in mind, applicant's eligibility for MHFA <br /> financing will be analyzed prior to the consideration for the City Revolving Loan Program. If <br /> the applicant qualifies for MHFA financing, then applicant will receive MHFA financing. If the <br /> applicant does not qualify for MHFA financing, eligibility for the City's Revolving Loan <br /> Program will be determined <br /> 1. Interest Rate: 4% <br /> 2. Income Limit: No maximum income limit <br /> 3. Loan Term: Generally, one year per $1,000 borrowed. The maximum term will be 15 <br /> years. <br /> 4. Loan Amount: Minimum loan size of$2,500 and maximum of$25,000. Previous <br /> recipients may apply and receive additional funds but are limited to the program <br /> maximum($25,000)to be outstanding at any given time. <br /> 5. Eligible Properties: Properties must be located within the geographical boundaries of <br /> the City of New Brighton. Eligible properties include owner occupied residential <br /> structures of two or less units. <br /> 6. Loan Security: All loans will be secured with a mortgage in favor of the City. <br /> Borrowers will pay all filing fees. <br /> 7. Debt- to -Income Ratio: Applicants must have the ability to repay the loan. <br /> Applicants who have a debt to income ratio in excess of 55%will be denied loan <br /> financing. <br /> 8. Loan - to -Value Ratio: The ratio of all loans secured by the property, including the <br /> new loan, must not exceed 110% of the property value. <br /> Terms of the MHFA Discount Loan Program <br /> CEE will utilize City funds to write down the interest rate on the Minnesota Housing Finance <br /> Agency's (MHFA) Community Fix-up Fund Program. The intent of the program is to make the <br /> City of New Brighton Home Improvement Program Page B-1 <br /> Center for Energy and Environment 6/2011 <br />