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HomeMy WebLinkAbout1992-164 Prom. Note - Kennedy PROMISSORY NOTE SECURED BY DEED OF TRUST $ ~_~ ~-' .~ (,,, L/ '~ Ashland, Oregon, ~,~L IV, 1992 For value received, I promise to pay to the order of the City of Ashland, Oregon, an ("City"), at City HalJ or such other place as the City may designate, the principal sum ($ plus accrued interest, updn the terms and cofaditions set forth below. 1. RECITALS. I acknowledge that this note is given in connection with my purchase of certain improved real property ("the home") which was developed as part of a City program to create owner-occupied housing that is affordable for low and moderate income households. I recognize that in purchasing the home I am receiving the benefits of the City's assistance to the developer.of the property upon which the home is located, and that without such assistance I would not have been able to purchase the home. I understand that signing this note and complying with its terms are necessary to permit the City to fulfill its affordable housing goals. 2. INTEREST. The unpaid principal balance of this note shall bear simple interest at the rate of six percent (6.0%) per year from the date of this note until paid. 3. REPAYMENT. 3.1. During the first 30 years after this note is executed, no payments of either principal or interest shall be due or payable so long as I continue to own and occupy the home as my primary residence, and so long as I am not in violation of any of the terms of this note or the trust deed securing it. I may also make a qualified transfer of the home to an eligible buyer who shall assume this note, as set forth below, without violating the terms of this note. 3.2. During the first 30 years after this note is executed, the total amount of the principal and accrued interest shall become immediately due and payable in full upon my transfer of the home to any person or entity other than an eligible buyer as defined below or to an otherwise eligible buyer who does not assume this note and the trust deed securing it and agree to comply with all of its terms, or whenever I cease to occupy the home as my primary residence, or whenever I am in default for failure to comply with any of the terms of this note or the trust deed. At the end of 30 years following the date of execution of this note, if I am at that time the owner and occupier of the home and am not in default under any terms of this note or the trust deed, this note and my obligation to pay the principal and accrued interest shall be cancelled and forgiven by the City. 4. TRANSFER. As used in this note, "transfer" means any sale, assignment or transfer, whether voluntary or involuntary, of any interest in the home, including, but not limited to, a fee simple interest, a co-tenancy interest, a survivorship interest, a life estate, a leasehold interest, any right to possession under a rental agreement, or an PAGE 1- PROMISSORY NOTE interest evidenced by a landsale contract in which possession of the home is transferred and I retain title. A transfer by gift, devise or inheritance to an existing spouse or surviving joint tenant, or a transfer to a spouse or former spouse as part of a dissolution of marriage proceeding or in connection with marriage shall not be considered a transfer for the purposes of this note. However, the provisions of this note shall continue in full force and effect as to such transferee. 5. NOTICE OF INTENDED TRANSFER. In the event I intend to transfer or vacate the home, I agree to promptly notify the City in writing at least 90 days before the actual date of the transfer or vacation, by certified mail, return receipt requested. 6. QUALIFIED TRANSFER. A transfer that meets the requirements set forth in this section shall be deemed a qualified transfer. At least 30 days prior to the transfer my proposed buyer and I shall provide the following information to the City: 6.1. The name, address and telephone number of the proposed buyer; 6.2. A financial statement signed by the proposed buyer and his or her spouse, if any, in a form acceptable by the City and accompanied by such supporting documentation as requested by the City. The financial information shall be used by the City to determine the income eligibility of the proposed buyer. 6.3. A copy of the proposed sales agreement and all related documents, which set forth the terms of the transfer; 6.4. A written certification signed by the proposed buyer and me in a form acceptable to the City stating that: 6.4.1. The transfer shall be closed in accordance with the terms of the sales agreement and other documents submitted and approved by the City; 6.4.2. Neither the proposed buyer nor any other party has paid or will pay to me or for my benefit, and I have not received nor will I receive from the proposed buyer or any other party, either directly or indirectly or for my benefit, money or any other consideration in addition to what is set forth in the sales agreement and related documents; 6.4.3. In the event that a transfer is made in violation of the terms of this agreement, or that false or misleading statements are made in any documents or certifications submitted to the City, the City shall have the right to file a legal action to force the parties to terminate or rescind the sales agreement, or to declare the sale void notwithstanding the fact that the sale may have closed and become final as between the buyer and me; 6.5. An assumption agreement signed by the proposed buyer in a form acceptable to the City under which the proposed buyer assumes the obligations and duties and agrees to bound by the provisions of this note and the trust deed securing it. Recording of the assumption agreement in the official records of Jackson County, Oregon, shall be a condition of the City's approval of the proposed transfer. PAGE 2- PROMISSORY NOTE (p:planning\afford. Not) I agree to pay a reasonable assumption fee to the City and to reimburse the City for its expenses incurred in administering its rights and obligations in connection with any transfer under this note. Upon the close of any transfer, I agree to provide the City with copies of the recorded trust deed, final sales contract, settlement statement, escrow instructions, and any other documents prepared or used in connection with the transaction. 7. ELIGIBLE BUYER. To be an eligible buyer, a buyer shall meet the following requirements: 7.1. Such buyer shall certify that he or she will occupy the home as his or her principal home; 7.2. The buyer and all other members of the buyer's household shall meet the income guidelines established from time to time by the City for participation in its affordable housing program. 8. REFINANCING. I understand that I will be entitled to refinance the existing purchase money first mortgage or trust deed encumbering the home by securing a new first mortgage or trust deed on the home in an amount not greater than the then present balance of the said first mortgage or trust deed plus applicable loan fees and closing costs, without causing this note to become immediately due and payable. I also understand that I shall be permitted to take out a home equity loan secured by a third mortgage or trust deed on the home, which shall be subordinate to this note and the trust deed securing it, without causing this note to become immediately due and payable, provided that the proceeds of such home equity loan shall only be used for improvements to the home, including landscaping. 9. BINDING EFFECT; JOINT AND SEVERAL OBLIGATIONS. This note and its terms shall be binding upon my heirs, executors, administrators, personal representatives, successors, and assigns. Throughout this note, the terms "1," "me," and "my" refer individually and collectively to all persons who sign this note, and all persons signing this note shall be jointly and severally liable for its obligations. 10. ATTORNEY FEES AND COSTS. If a legal action is commenced to enforce any of the provisions of this note, including, without limitation, any arbitration, mediation, or action in any court, including the prosecution or defense of any proceeding in bankruptcy court, the prevailing party shall be entitled to recover from the other party costs, disbursements and attorney fees incurred both at trial and on appeal. If the legal action results in a monetary judgment, injunction or other equitable relief, the prevailing party shall also be entitled to recover, in addition to prejudgment attorney fees, an amount sufficient to defray the expense of attorney fees and other costs and disbursements necessary for enforcement or collection of the judgment. As used in this section the term "costs" includes expenses for expert witness fees, pretrial and post-judgment discovery, title search and title insurance charges, and any other reasonable expenses, whether or not they would otherwise be known as "costs and disbursements." PAGE 3- PROMISSORY NOTE (p:plann[ng\afford.Not) 11. SEVERABILITY; GOVERNING LAW. If any provision of this note is or becomes inconsistent with any applicable present or future law, rule or regulation, such provision will be deemed rescinded or modified in order to comply with the relevant law rule or regulation, and all other provisions of this note shall continue in full force and effect. This note shall be governed by and interpreted under the laws of the State of Oregon. 12. NOTICES. Any notice required or permitted under this note shall be in writing sent postage prepaid, by certified U.S. mail, return receipt requested. Notices to me shall be sent to the home. Notices to the City shall be sent to City Hall. 13. PARAGRAPH HEADINGS. The paragraph headings in this note are used for convenience only and do not restrict the meanings of the paragraphs to which they refer. 14. NO WAIVER. Failure by the City to require strict performance of any term of this note, including the extension of any payment or acceptance of any part of a payment, shall not affect the City's rights or be considered a waiver by the City of the strict performance of all conditions of this note. No waiver by the City of any default shall be considered a waiver of any subsequent default or a waiver of this paragraph. EXECUTED this ! ~ day of ~ ,1992. NOTICE TO BUYER: THIS DOCUMENT CONTAINS PROVISIONS RESTRICTING RESALES AND ASSUMPTIONS. Printed Name Signature Printed Name PAGE 4- PROMISSORY NOTE (~:p~m~\af£ord. Not) Katherine Kennedy