Miami-Dade Legislative Item
File Number: 152516
Printable PDF Format Download Adobe Reader  Clerk's Official Copy   

File Number: 152516 File Type: Ordinance Status: Adopted
Version: 0 Reference: 15-127 Control: Board of County Commissioners
File Name: ESTABLISHING HOMEBUYER LOAN PROGRAM Introduced: 10/27/2015
Requester: NONE Cost: Final Action: 11/3/2015
Agenda Date: 11/3/2015 Agenda Item Number: 7C
Notes: Title: ORDINANCE CREATING ARTICLE XII OF CHAPTER 17 OF THE CODE OF MIAMI-DADE COUNTY, FLORIDA, ESTABLISHING HOMEBUYER LOAN PROGRAM USING DOCUMENTARY SURTAX FUNDS; ESTABLISHING PROGRAM FOR CERTIFYING QUALIFIED LOAN OFFICERS TO APPROVE PARTICIPANT HOMEBUYERS FOR THE PROGRAM; ESTABLISHING PROGRAM FOR CERTIFYING QUALIFIED CLOSING AGENTS TO CLOSE HOMEBUYER LOANS; ESTABLISHING ESSENTIAL TERMS OF THE PROGRAM; AMENDING SECTION 29-7 OF THE CODE OF MIAMI-DADE COUNTY TO MAKE THE DOCUMENTARY SURTAX PROGRAM CONSISTENT WITH THE HOMEBUYER LOAN PROGRAM ESTABLISHED HEREIN; PROVIDING SEVERABILITY, INCLUSION IN THE CODE, AND AN EFFECTIVE DATE [SEE ORIGINAL ITEMS UNDER FILE NOS. 151592, 152377]
Indexes: LOAN PROGRAM
Sponsors: Jean Monestime, Prime Sponsor
  Daniella Levine Cava, Co-Sponsor
  Barbara J. Jordan, Co-Sponsor
Sunset Provision: No Effective Date: Expiration Date:
Registered Lobbyist: None Listed


Legislative History

Acting Body Date Agenda Item Action Sent To Due Date Returned Pass/Fail

Board of County Commissioners 11/3/2015 7C Adopted P
REPORT: First Assistant County Attorney Geri Bonzon-Keenan read the title of the foregoing proposed ordinance into the record. Hearing no questions or comments, the Board proceeded to vote on the foregoing proposed ordinance, as presented.

County Attorney 10/27/2015 Assigned Brenda Kuhns Neuman 10/27/2015

Economic Prosperity Committee 10/15/2015 2G SUB AMENDED Forwarded to BCC with a favorable recommendation with committee amendment(s) P
REPORT: Chairman Suarez introduced the foregoing proposed ordinance into the record and subsequently opened the public hearing; and upon seeing no one appear; closed the public hearing. Board of County Commissioners’ (BCC) Chairman Monestime explained the intent of the foregoing proposed ordinance. Assistant County Attorney Terrence Smith advised the Committee members that there was an amendment to the foregoing proposed item. Assistant County Attorney Brenda Kuhns Neuman stated that the foregoing proposed ordinance was amended to restore the words “and mortgage brokers” which was previously stricken from the language found on handwritten page 7; Section 17-161, Subsection B entitled “Qualifications of Borrowers.” Chairman Suarez reopened the public hearing to allow Mr. Albert Milo the opportunity to address the Committee members. 1. Mr. Albert Milo, Principal and Senior Vice President of Related Urban Development, 315 S. Biscayne Boulevard, Miami FL appeared in support of the foregoing proposed ordinance. Commissioner Sosa requested clarification regarding the funding source for the program. Mr. Michael Liu, Executive Director for Miami-Dade Public Housing and Community Development (PHCD) explained that funding for the program would be sourced from earmarked surtax funds. Commissioner Sosa offered a friendly amendment to divide funding among the 13 Commission Districts. BCC Chairman Monestime noted that the program was Countywide and did not target a specific Commission District. Commissioner Sosa voiced her concerns regarding the equitable division of funds and inquired in the program would be advertised to raise awareness and encourage community participation. BCC Chairman Monestime stated that he specifically included language regarding “non-target areas” to encourage potential buyers to participate in the program. Commissioner Sosa’s expressed concerns regarding the advertising process. Mr. Liu spoke about the existing homeownership program and acknowledged the limited reach of the program. He estimated that the existing program had only helped 500 owners over the past 10 years but voiced his optimism with regards to the foregoing proposed ordinance and stated that he believed the item would help expand and develop the homeownership program throughout the County. Commissioner Levine Cava requested to be added as a co-sponsor. She pointed out that the foregoing proposed ordinance was accompanied by a social equity impact statement, the first of its kind pursuant to recently passed legislation which requires a written social equity statement for all new ordinances. Commission Levine Cava requested future statements highlight and underscore the benefits the proposed legislation would bring to the community. Commissioner Barreiro commended BCC Chairman Monestime for his involvement with the foregoing proposed ordinance and recognized components of the program which he believed were particularly beneficial to the County and program participants. There being no further questions or comments, the Committee forwarded the foregoing proposed ordinance to the BCC with a favorable recommendation with Committee amendments to amend to restore the words “and mortgage brokers” which was previously stricken from the language found on handwritten page 7; Section 17-161, Subsection B entitled “Qualifications of Borrowers.”

Legislative Text


TITLE
ORDINANCE CREATING ARTICLE XII OF CHAPTER 17 OF THE CODE OF MIAMI-DADE COUNTY, FLORIDA, ESTABLISHING HOMEBUYER LOAN PROGRAM USING DOCUMENTARY SURTAX FUNDS; ESTABLISHING PROGRAM FOR CERTIFYING QUALIFIED LOAN OFFICERS TO APPROVE PARTICIPANT HOMEBUYERS FOR THE PROGRAM; ESTABLISHING PROGRAM FOR CERTIFYING QUALIFIED CLOSING AGENTS TO CLOSE HOMEBUYER LOANS; ESTABLISHING ESSENTIAL TERMS OF THE PROGRAM; AMENDING SECTION 29-7 OF THE CODE OF MIAMI-DADE COUNTY TO MAKE THE DOCUMENTARY SURTAX PROGRAM CONSISTENT WITH THE HOMEBUYER LOAN PROGRAM ESTABLISHED HEREIN; PROVIDING SEVERABILITY, INCLUSION IN THE CODE, AND AN EFFECTIVE DATE [SEE ORIGINAL ITEMS UNDER FILE NOS. 151592, 152377]

BODY
BE IT ORDAINED BY THE BOARD OF COUNTY COMMISSIONERS OF MIAMI-DADE COUNTY, FLORIDA:
Section 1. Article XII of Chapter 17 of the Code of Miami-Dade County, Florida, is hereby created and shall read as follows:1
>>Sec. 17-160 Legislative Intent and Purpose.

There is hereby created and established a homebuyer assistance program to be known as the �Homebuyer Loan Program,� which shall provide mortgage loan assistance to assist qualified low- and moderate-income individuals and families in the purchase of a primary residence.

This program is intended to assist low- and moderate-income individuals and families, to encourage young professionals and college graduates to invest in and remain in Miami-Dade County, and to encourage homeownership among low- and moderate-income families in order to facilitate the achievement of personal and familial wealth and stabilize communities. The program is also intended to encourage homeownership in the County�s Neighborhood Revitalization Strategy Areas (�NRSA�) and Neighborhood Outreach Areas (�NOA�), as defined in the County�s Five-Year Consolidated Plan filed with the United States Department of Housing and Urban Development (�U.S. HUD�) for federal Community Development Block Grant, Home Investment Partnerships Program and Emergency Solutions Grant funding.

The Homebuyer Loan Program shall be the mechanism for providing homebuyer mortgage loan assistance using Documentary Surtax funds. This Homebuyer Loan Program ordinance shall apply only to the use of Documentary Surtax funds and shall not govern the use of state or federal funds.


Section 17-161 Administration of the Homebuyer Loan Program.

(A) The Homebuyer Loan Program shall be administered through the County�s Public Housing and Community Development department (the �Department�), or successor department or other department as designated by the County Mayor. The Department shall develop the Homebuyer Loan Program Guidelines consistent with this ordinance, which guidelines may be revised by the County Mayor or County Mayor�s designee from time to time and which shall be made available on the Department�s website and provided to all Certified Loan Officers and Certified Closing Agents. The program rules described in this ordinance shall supersede any other homebuyer mortgage assistance program guidelines or legislation not in conformance herewith.

(B) Qualification of Borrowers. Qualification of borrowers shall be conducted by �Certified Loan Officers�, which shall mean loan originators<< >>and mortgage brokers<<2 >>licensed by the State of Florida who have received a certification of qualification by the County following a training program to be conducted by the County or other agency, as may be delegated by the Board of County Commissioners (the �Board�). There shall be no fees or costs charged by the Certified Loan Officers to either the County, applicants, or approved borrowers for processing loan applications or qualifying borrowers for the County�s Homebuyer Loan Program.

Certified Loan Officers shall submit the borrower�s completed Homebuyer Loan Program application package, including completed application forms, qualification letter, conditional underwriting approval, fully executed purchase and sale agreement (if executed), and conditional approval of the first lender along with supporting documentation to the Department. A full list of documents to be submitted to the Department shall be developed by the Department, or successor department, and provided to the Certified Loan Officers during the training program required herein. In order to expedite the home buying process, Certified Loan Officers may approve borrowers prior to the borrower�s execution of a purchase and sale agreement for a home.

(C) Loan Review and Approval. The Department shall conduct a quality control underwriting review to ensure completeness of the Homebuyer Loan Program application package and that each borrower meets the basic qualifications of the program. This review shall be completed no more than five (5) business days from the time the completed Homebuyer Loan Program application package is submitted to the Department.

(D) Loan Closing. The Department staff shall process the completed Homebuyer Loan Program application package through post-closing. During that time, the Department shall review the title policy, insurance and first lender loan commitment. The Department may establish additional items to be reviewed prior to closing. The Department shall issue a loan commitment for funding and process the request for funding to the Finance Department, or other funding department, for disbursement of the loan funds at the time of closing.

Loan closing shall be conducted by a �Certified Closing Agent,� which shall mean a title insurer, title insurance agent or agency, or attorney agent in the agent�s or agency�s capacity licensed by the State of Florida who has received a certification of qualification by the County following a training program conducted by the County or other agency, as may be delegated by the Board.

At loan closing, the borrower shall execute the County�s loan documents, which shall consist of a promissory note, a mortgage, and a restrictive covenant. The loan documents shall be provided to the Certified Closing Agents and may not be substantially modified without the consent of the Department. The Department shall provide instructions to Certified Closing Agents describing how the County�s loan documents are to be completed. All provisions regarding the terms of the loans shall be encompassed in the documents provided.

(E) The loans provided through the Homebuyer Loan Program (the �Homebuyer Loan�) shall include the following terms.

(1) Limitations on Use and Resale of Property. Borrower shall use the property as a primary residence. The property may not be rented, leased, or otherwise used as income or investment property for as long as the loan remains in effect. Violation of this provision shall cause the loan to be accelerated and the entire balance of the loan, including principal and interest, shall become immediately due and payable to the County. If the borrower sells, transfers, rents or vacates the property, the entire balance of the loan, including principal and interest, shall become due upon vacating, selling, renting or transferring the property.

A restrictive covenant shall be required as a part of the Homebuyer Loan Program, which covenant shall include the residency, resale restrictions and shared equity restrictions set forth in this ordinance as well as other terms included at the discretion of the Department not inconsistent with this ordinance.

(2) Subordination of the County�s Homebuyer Loan. The County�s loan provided through the Homebuyer Loan Program shall be a second mortgage loan in priority, subordinate to the first lender, so long as the first loan (a) is for an amount greater than the amount of the County�s Homebuyer Loan, (b) has a fixed interest rate considered to be a reasonable market rate, (c) has no balloon payment, and (d) has no pre-payment penalty. If the other loan(s) are for amounts less than the amount of County�s Homebuyer Loan, then the County�s Homebuyer Loan shall be the senior loan with priority over the other lender(s). The County�s loan provided through the Homebuyer Loan Program may be a third mortgage loan or lower in priority, at the discretion of the Department, so long as the senior lender is known to be a state, county, city, local housing agency, or nonprofit organization. All loans other than the first mortgage loan must be subordinate to the County�s Homebuyer Loan Program loan, unless the subordination is expressly consented to by the Department upon a finding that such subordination is in the best interest of the County.


(3) Loan Terms.

(a) Term of Loan. The Homebuyer Loan shall be for a term of 30 years, and interest and payments shall be calculated based upon a 30-year term.

(b) Interest rate. The Homebuyer Loan program shall encourage homeownership in the County�s NRSAs and NOAs by offering more favorable loan terms for Homebuyer Loans used to acquire homes in the NRSAs and NOAs.

(i) Target Area Loans. Homebuyer Loans used to acquire homes in the County�s NRSAs and NOAs shall have a one percent (1%) compounded interest rate and shall be recorded as satisfied after ten (10) years, so long as the Homebuyer Loan is not in default or in arrears at the time of satisfaction, Borrower has resided in the property for the entire life of the loan, and Borrower has demonstrated a general diligence and overall compliance with the loan terms. The County Mayor or County Mayor's designee shall publish standards by which the Borrower�s general diligence and overall compliance with the loan terms may be established.



(ii) Non-Target Area Loans. Homebuyer Loans used to acquire homes outside of the County�s NRSAs and NOAs shall have a 2 percent (2%) compounded interest rate and shall be recorded as satisfied after twenty (20) years, so long as the Homebuyer Loan is not in default or in arrears at the time of satisfaction, Borrower has resided in the property for the entire life of the loan, and Borrower has demonstrated a general diligence and overall compliance with the loan terms. The County Mayor or County Mayor's designee shall publish standards by which the Borrower�s general diligence and overall compliance with the loan terms may be established.

(c) Shared Equity. Following loan closing on the Homebuyer Loan, if borrower sells, transfers or otherwise conveys the property within six years after closing on the Homebuyer Loan (the �Shared Equity Period�), borrower shall share with the County a percentage of the proceeds of the resale in the following manner:

Shared Equity Period: Number of Years after Closing on Homebuyer Loan with the County
Percentage of Profit from Resale to be Paid to the County
1
100%
2
100%
3
100%
4
50%
5
50%
6 or more
0%

During the Shared Equity Period, Borrower shall not resell the property for less than fair market value, as determined by an appraisal from a licensed appraiser. In year five of the Shared Equity Period, if Borrower resells the property but purchases another home in Miami-Dade County within 180 days and resides in that home as Borrower�s primary residence, the profit retained by the County as shared equity shall be returned to the Borrower. The County shall hold its portion of the shared equity in escrow for 180 days, plus any reasonable extension of time permitted at the discretion of the County Mayor or County Mayor's designee. There shall be no maximum resale price. At any time, the borrower shall have the right to pay the County�s Homebuyer Loan in full, and upon the payment of all outstanding principal, interest and unpaid fees or costs, as set forth in the loan documents, the borrower and the property shall be released from all restrictions. As such, the borrower shall not be required to reside in the property for any set period of time, so long as the Homebuyer Loan is repaid in full and in accordance with the Shared Equity provisions set forth herein. There shall be no pre-payment penalties other than the Shared Equity provisions described in this ordinance.

(d) Maximum Loan Amount. The maximum loan amount for a Homebuyer Loan offered through this program shall be determined by the Certified Loan Officers, but in no event shall the amount of such loan be greater than $100,000.00 for Target Area Loans or $80,000.00 for Non-Target Area Loans.

In order to avoid borrowers being cost-burdened by housing expenses, the Homebuyer Loan shall be implemented in a manner so as to ensure that no more than 40 percent of the borrower�s gross household income is used to pay for �Housing Costs,� which means all mortgage payments, insurance and taxes. Borrower�s payments on the Homebuyer Loan shall be established at the time of loan closing and shall remain the same for the entire term of the homebuyer loan unless borrower and the County mutually agree on a loan modification.


(e) Down Payment Required. The County shall require a down payment of at least one percent (1%) of the purchase price, to be paid from the Borrower�s own funds.

(4) Purchase Price Maximum. The maximum purchase price for borrowers to purchase a home with a Homebuyer Loan shall be 90 percent of the area median purchase price, as determined using purchase price limits established by U.S. HUD for the Home Investment Partnerships (�HOME�) program (the �Maximum Purchase Price�). The Maximum Purchase Price shall be established using the most current data as of the date of execution of the contract for purchase and sale. With respect to the issuance of a Homebuyer Loan, the Maximum Purchase Price set forth in this ordinance shall supersede any other maximum purchase price set forth in any County resolution or ordinance. However, the Maximum Purchase Price established by other County programs or legislation, such as the Infill Housing Initiative Program, Workforce Housing Development Program, or the sale of County-owned properties, shall not be affected by this ordinance.

(5) Loan Servicing. The Department, or successor department or other department as designated by the County Mayor or County Mayor's designee, shall serve as the loan servicer on all Homebuyer Loans.


(6) Borrower Eligibility. Borrowers shall be �First Time Homebuyers,� as defined by the HOME program at 24 C.F.R. � 92.2, with household incomes not greater than the 140 percent of area median income, as established by U.S. HUD.

Further eligibility requirements shall be set forth in the Homebuyer Loan Program Guidelines, established by the Department, which shall be consistent with Section 125.0167 of the Florida Statutes and Section 29-7 of the Miami-Dade County Code of Ordinances.




(7) Inspections Required. Prior to loan closing, borrowers must obtain an inspection by a qualified home inspector of the home they intend to purchase. The breadth of the home inspection shall be sufficient to alert homebuyers to significant defects in the home, including structural problems, and identify whether the home is in compliance with the Miami-Dade County Building Code.

(8) Use of Repaid Loan Funds and Program Income. The Homebuyer Loan Program shall operate as a �revolving� loan fund. All repaid Homebuyer Loan funds or program income received through administration of the Homebuyer Loan Program shall be reallocated by the County back into the Homebuyer Loan Program to be used for additional Homebuyer Loans. The Department shall incorporate this policy into its action plans, Local Housing Assistance Plans, legislative items, and policy documents governing the County�s use of Documentary Surtax funds.<<


Section 2. Section 29-7 of the Code of Miami-Dade County, Florida, is hereby amended to read as follows:
Sec. 29-7. Documentary Stamps.

* * *


(E) Administration, collection and use.

* * *

(g) Subject to the limitations and requirements set forth above, the revenue shall be expended by the County only in accordance with the Miami-Dade County Affordable Housing Program Guidelines >>and the Homebuyer Loan Program established pursuant to Section 17-160, et. seq. of the Code of Miami-Dade County, Florida.<<

* * *


Section 3. If any section, subsection, sentence, clause or provision of this ordinance is held invalid, the remainder of this ordinance shall not be affected by such invalidity.
Section 4. It is the intention of the Board of County Commissioners, and it is hereby ordained that the provisions of this ordinance, including any sunset provision, shall become and be made a part of the Code of Miami-Dade County, Florida. The sections of this ordinance may be renumbered or relettered to accomplish such intention, and the word "ordinance" may be changed to "section," "article," or other appropriate word.
Section 5. This ordinance shall become effective ten (10) days after the date of enactment unless vetoed by the Mayor, and if vetoed, shall become effective only upon an override by this Board.

1 Words stricken through and/or [[double bracketed]] shall be deleted. Words underscored and/or >>double arrowed<< constitute the amendment proposed. Remaining provisions are now in effect and remain unchanged.
2 Committee amendments are indicated as follows: Words double stricken through and/or [[double bracketed]] are deleted, words double underlined and/or >>double arrowed<< are added.



Home  |   Agendas  |   Minutes  |   Legislative Search  |   Lobbyist Registration  |   Legislative Reports
2024 BCC Meeting Calendar  |   Miami-Dade County Code of Ordinances   |   ADA Notice  |  

Home  |  Using Our Site  |  About Phone Directory  |  Privacy  |  Disclaimer

E-mail your comments, questions and suggestions to Webmaster  

Web Site � 2024 Miami-Dade County.
All rights reserved.