- where the Housing Finance Committee determines that it is in Housing Finance Committee. The committee having final responsibility for approval or rejection of applications for housing rehabilitation loans. The Housing Finance Committee is also responsible for reviewing administration of the Housing Rehabilitation Services Program by the Department of Housing and Community Development and making recommendations to the Mayor and Common Council on matters pertaining to program policies, procedures and administration. Housing Rehabilitation Loan. A loan approved by the Housing Finance Committee to finance, in whole or in part, the cost of rehabilitation work needed to bring a property into compliance with the Minimum Housing and Property Maintenance Code of the City of Madison and other applicable property rehabilitation standards under the Housing Rehabilitation Services Program. Incidental Expenses. Those costs incurred by a borrower in the process of obtaining a housing rehabilitation loan, which are deducted from the proceeds of the loan. Minimum Housing and Property Maintenance Code. Chapter 27 of the Madison General Ordinances, as duly adopted and presently in effect, and as the said Chapter 27 may be duly amended from time to time by the Common Council of the City of Madison. Owner-occupied Property. A property used entirely for residential purposes, occupied by the owner, and containing not more than four separate dwelling units. Nonprofit Housing Cooperative. A nonprofit association duly organized and existing under Chapter 185 of the Wisconsin Statutes, which either holds fee simple title to a property to be rehabilitated for occupancy by individuals or families of low and moderate income who are also members of the association, or has purchased such property under a recorded land sales contract. Nonprofit Housing Corporation. A nonprofit corporation duly organized and existing under Chapter 181 of the Wisconsin Statutes, which either holds fee simple title to a property to be rehabilitated for occupancy or continued occupancy by individuals or families of low or moderate income, or has purchased such property under a recorded land sales contract. Person. One or more natural persons who occupy a property to be rehabilitated, and who either hold fee simple title to such property or have purchased such property under a recorded land sales contract. Property Rehabilitation Standards. The standards contained in the Minimum Housing and Property Maintenance Code of the City of Madison and other local codes and ordinances pertaining to housing construction, and to use, occupancy and maintenance of existing residential properties, which are applicable to the property through code enforcement action. Rehabilitation Cost. The total cost of repairs and improvements and other costs for rehabilitation to be incurred by the applicant/borrower that are includable in a housing rehabilitation loan, whether or not such costs are financed in part with funds from other sources. Rehabilitation Escrow Account. A single cash account on the records of the Department of Housing and Community Development used to reflect the deposit and disposition of all funds to be used in the rehabilitation of a specific property. Rehabilitation Loan Officer. The staff member of the Department of Housing and Community Development having primary responsibility for preparation and processing of housing rehabilitation loan applications, handling of loan settlements, and implementing loan repayment procedures. Rehabilitation Supervisor. The staff member of the Department of Housing and Community Development having primary responsibility for day-to-day operation of the Housing Rehabilitation Services Program and supervision of the staff of the Department's Rehabilitation Division. Right of Rescission. The borrower's right, within a three-day period from the date of loan settlement, to rescind the entire loan transaction. The right of rescission applies to a housing rehabilitation loan secured by a mortgage on a residential property which contains not more than four dwelling units and is owned by a borrower who is a natural person and who occupies one of the dwelling units on the property. Work Write-up and Cost Estimate. A work write-up and cost estimate is a statement itemizing all rehabilitation work needed to be done on a property to bring the property into compliance with the Minimum Housing and Property Maintenance Code and other applicable property rehabilitation standards and including a reasonable estimate of the cost of each work item. The work write-up and cost estimate is prepared by the Rehabilitation Division of the Department of Housing and Community Development on the basis of an inspection made by the Area Housing Code Enforcement Officer and the Rehabilitation Supervisor. Low and Moderate Income Individual or Family. For the purposes of the Housing Rehabilitation Services Program, a low income individual or family is one whose gross annual income does not exceed the appropriate maximum income shown in column (b) of Appendix 1 of this Handbook. A person or family of moderate income is one whose incone exceeds the appropriate maximum income shown in column (b) of Appendix 1, but does not exceed the appropriate maximum income shown in column (d) of Appendix 1. CHAPTER 2 - ELIGIBILITY REQUIREMENTS FOR HOUSING REHABILITATION LOANS This chapter sets forth the eligibility requirements pertaining to the property and the applicant for a housing rehabilitation loan. 1. Property Eligibility Requirements. Housing rehabilitation loans may be made only for residential properties located in the City of Madison. property for which a housing rehabilitation loan is made, must: Any b. C. be in need of rehabilitation to meet the requirements of the be physically and financially feasible of rehabilitation to a The owner of the property must permit all inspections of the property deemed necessary by the Building Inspection Division and/or the Department of Housing and Community Development under the Housing Rehabilitation Services Program. 2. Types of Applicants. Housing rehabilitation loans may be made only to the following types of applicants: a. b. c. a person of low or moderate income who either owns and occupies a nonprofit housing corporation which either owns the property for which the housing rehabilitation loan is requested, or is the purchaser of such property under a recorded land sales contract; or a nonprofit housing cooperative which either owns the property for which the housing rehabilitation loan is requested, or is the purchaser of such property under a recorded land sales contract. 3. Requirements Applicable to Every Loan. In order to be eligible for a housing rehabilitation loan, the applicant must demonstrate both willingness and adequate capacity to repay the loan. A housing rehabilitation cannot be approved if the applicant's record shows a disregard for former obligations, or if there is a clear inability to make the payments that will be required. In addition to these requirements, which apply to all loans, the requirements of the following paragraphs of this chapter also apply, depending upon the type of applicant and property ownership involved. 4. Income Limits for Applicant Who is a Person. As used herein, the term " 'person" means one or more natural persons who occupy a property to be rehabilitated, and who either hold fee simple title to such property or have purchased such property under a recorded land sales contract. In approving housing rehabilitation loans to applicants who are persons, the Housing Finance Committee shall give priority to persons whose gross annual income is within the limitations prescribed for the City of Madison for occupancy of projects financed with below-market interest rate mortgages insured by the Federal Housing Administration (FHA) under Section 221 (d)(3) of the National Housing Act. The Committee will not approve housing rehabilitation loan applications from persons whose gross annual income exceeds 135% of the Section 221 (d) (3) limits. (See Appendix 1 for Section 221 (d) (3) income limits.) The following is a listing of the elements comprising income for purposes of determining an applicant's eligibility for a housing rehabilitation loan: a. The applicant's earnings. 5. b. Spouse's earnings, and earnings of all other members of the family C. Other income regularly received by the applicant or his family d. Net income from real estate other than the property to be If e. Net operating income from the property to be rehabilitated. For purposes of establishing the amount of the applicant's income that is relevant to the Section 221 (d) (3) income limits, there shall be excluded from the applicant's income the income of a dependent child or children, as defined by the United States Internal Revenue Service. The applicant's income, adjusted in this manner, shall be related to the Section 221(d) (3) income limits prescribed for the City of Madison for a family of the same size as the applicant's. Income Limits for Applicant That is a Nonprofit Housing Corporation or Cooperative. As used herein, the term "nonprofit housing corporation" means a nonprofit 6. corporation duly organized and existing under Chapter 181 of the Wisconsin Statutes, which either holds fee simple title to a property to be rehabilitated for occupancy or continued occupancy by individuals or families of low or moderate income, or has purchased such property under a recorded land sales contract. The term "nonprofit housing cooperative" means a nonprofit association duly organized and existing under Chapter 185 of the Wisconsin Statutes, which either holds fee simple title to a property to be rehabilitated for occupancy or continued occupancy by individuals or families of low or moderate income who are also members of the association, or has purchased such property under a recorded land sales contract. In approving housing rehabilitation loans to nonprofit housing corporations and cooperatives, the Housing Finance Committee shall give priority to nonprofit housing corporations and cooperatives that have annual net incomes of $6,800 or less (before depreciation and income taxes). The Committee will not approve housing rehabilitation loan applications from nonprofit housing corporations or cooperatives that have annual net incomes (before depreciation and income taxes) of $9,180 or more. The following is a listing of the elements of income attributable to an applicant nonprofit housing corporation or cooperative for purposes of determining the applicant's eligibility for a housing rehabilitation loan: a. Net income from real estate other than the property to be b. Net operating income from the property to be rehabilitated. Income of a nonprofit housing corporation or cooperative does not include the income of any director, official, officer, employee, shareholder or other participant in the business. Land Sales Contract. The term "land sales contract" refers to any transaction, regardless of the nomenclature by which it is known, in which the purchaser (if a nonprofit housing corporation or cooperative) or purchaseroccupant (if a person) obtains fee title only if he completes a series of installment payments over a period of years. a. Eligibility Requirements. In order for a purchaser under a (1) The contract shall be a written, legally binding, (2) The seller of the property must hold fee simple title |