CC PACKET 09242002 - Laserfiche WebLink

Home Browse Search

1 24 CITY OF ST. ANTHONY OWNER OCCUPIED REVOLVING LOAN PROGRAM September 9, 2002 SUBORDINATION DISCLOSURE You are receiving or have received an Owner Occupied Revolving Loan (loan) from the City of St. Anthony (City). If at some future date, you choose to obtain a new loan or other financing that uses your home as security (a mortgage is a financial instrument that pledges your house as security for a loan), there are some facts you should know about-your City loan that may guide and influence your decision. Most, if not all, lenders will want their new mortgage to have as high a lien position as possible — preferably a first lien position. If your new loan is a refinance of your current first mortgage, when your first mortgage is paid off, by Minnesota State law, the City loan (along with any other secured financing) automatically moves up in lien position. Regardless of the amount secured, the new mortgage takes the lowest lien position on the title of your property. The only way for your new mortgage lender to obtain a first lien position is to either include in your new mortgage loan some funds to pay off the existing (older) loans or for you and the new mortgage company to request and obtain the City's approval to have the City Loan subordinated to your new mortgage. Subordinated means that the City signs an agreement that says it will allow your new mortgage to move to a higher lien position, and moving the City loan mortgage to a lower lien position (behind your new mortgage). The City will consider a subordination request subject to the City of St. Anthony SUBORDINATION POLICY. A copy of the current policy is on the reverse side of this disclosure statement. The City will not approve a subordination request if any of the following conditions exist: ♦ The new financing is an open line of credit. ♦ The home is no longer owner-occupied. ♦ A request to subordinate a City Loan behind a transaction that includes additional debt being added into the new first mortgage (i.e. debt consolidation, cash out at closing, etc) Requests for approvals of subordination must be submitted in writing to the Greater Metropolitan Housing Corporation - Housing Resource Center from which the loan was obtained at least 30 days prior to the expected closing date of the new mortgage. The City, prior to closing of the new financing, must approve all loan subordination requests.. The City reserves the right to refuse any subordination request that (a) does not meet the City of St. Anthony SUBORDINATION POLICY or (b) is not in the City's best interest. There is a $50 processing fee charged for each subordination request. Please sign indicating that you have read and understand the Subordination Disclosure Statement and City Subordination Policy. Borrower: Borrower DRAFT Date City of St. Anthony ❖ ❖ St. Anthony ❖ Minnesota ❖ 55.1.43