HomeMy WebLinkAboutMINUTES - 12072010 - C.20RECOMMENDATION(S):
1. APPROVE request from Old Republic Title Company to accept $3,755 in lieu of a full
repayment of $37,552 in Community Development Block Grant (CDBG) funds: and
2. AUTHORIZE the Conservation and Development Director, or designee, to execute the
appropriate documents to reconvey the Deed of Trust.
FISCAL IMPACT:
No General Fund impact. The CDBG funds are provided to the County on a formula
allocation basis through the U.S. Department of Housing and Urban Development (HUD).
CFDA number 14.218
BACKGROUND:
In 2005, the County provided a $37,552 no interest loan in CDBG funds through the
Neighborhood Preservation Program to the owner of 4302 Harmon Road, El Sobrante. At
that
APPROVE OTHER
RECOMMENDATION OF CNTY
ADMINISTRATOR
RECOMMENDATION OF BOARD
COMMITTEE
Action of Board On: 12/07/2010 APPROVED AS RECOMMENDED OTHER
Clerks Notes:
VOTE OF SUPERVISORS
AYE:Gayle B. Uilkema, District II
Supervisor
Mary N. Piepho, District III
Supervisor
Federal D. Glover, District V
Supervisor
ABSENT:John Gioia, District I
Supervisor
Contact: Kara Douglas
335-7223
I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the
Board of Supervisors on the date shown.
ATTESTED: December 7, 2010
David J. Twa, County Administrator and Clerk of the Board of Supervisors
By: June McHuen, Deputy
cc:
C.20
To:Board of Supervisors
From:Catherine Kutsuris, Conservation & Development Director
Date:December 7, 2010
Contra
Costa
County
Subject:Community Development Block Grant Neighborhood Preservation Program Partial Loan Repayment
BACKGROUND: (CONT'D)
time, the appraised value of the home was $405,000. Wachovia has a first mortgage loan in
the amount of $300,000. As is standard practice, the County loan is subordinate to the
Wachovia loan.
The owner of the property has a purchase offer of $165,000, which is substantially below
the total outstanding loans of approximately $337,552. The first lender, Wachovia (now
Wells Fargo Bank) has agreed to a payoff of $142,512. The seller is requesting the County
agree to a payoff of $3,755. Wachovia is paying the property owner $5,000 to cooperate in
the short sale. The remaining proceeds from the sale will be used to pay property taxes,
transfer and escrow fees, and Realtor commissions.
The County was originally offered $3,000. County staff queried staff in nearby jurisdictions
to learn what others have accepted in short sale payoffs. They responded that most loan
payments to subordinate lenders are between $1,000 and $3,000. The revised payoff amount
of $3,755 is 10 percent of the original loan amount and is consider a reasonable offer by the
first lender. First lenders control the terms of short sales. The first lender does not have to
agree to the purchase price or the payoff amounts. If the County does not work with the
seller and first lender to facilitate the short sale, the home could be taken by the first lender
through a foreclosure. If the home is foreclosed upon, the County will not receive any loan
repayment and the seller will not receive the $5,000 moving incentive from Wachovia.
CONSEQUENCE OF NEGATIVE ACTION:
If the Board of Supervisors does not approve this request, the buyer will not be able to
purchase the home and the bank will foreclose on the property. If the bank does foreclose,
the County will not receive any payment.
CHILDREN'S IMPACT STATEMENT:
N/A