7.4. HRSR 02-07-2022 - Laserfiche WebLink

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Exhibit A Page 3 Agreement between Elk River HRA and Center for Energy and Environment Loan - to - Value Ratio: The ratio of all loans secured by the property, including the new loan, should not exceed 100% of the property value. Half of the improvement value may be added to the initial property value. Income Limit: No maximum income limit. Debt - to - Income Ratio: Applicant must have the ability to repay the loan. An applicant who has a debt to income ratio in excess of 43% will be ineligible to receive financing. Credit Score Requirement: All borrowers must have a minimum of a 620 credit score. Credit Requirements: 1) All mortgage payments must be current and reflect no 30 day late payments history in the past 12 month period (without reasonable explanation). 2) All real estate taxes must be current. 3) No outstanding judgements or collections. 4) Bankruptcy must have been discharged for at least 24 months prior to loan closing. 5) The redemption period on prior foreclosures must have occurred at least 24 months prior to the loan application date. 6) Generally, no more than two 30-day late payments on credit report in the past year (without reasonable explanation). Any 30 day late requires a documented explanation and reasonable reasons; medical, unemployment, divorce. 7) No defaulted government loans. Multiple Loans per Property: More than one loan per property is allowed, however, the outstanding balance(s) cannot exceed the maximum program limit and previous loans are current and have an acceptable payment history. Eligible Use of Funds: Loans may be used to finance most permanent interior and exterior improvements including, but not limited to: roofing, siding, doors/windows, plumbing, electrical, HVAC, insulation, solar, garage, driveways, sidewalks/steps, painting, flooring, additions, landscaping, etc. Ineligible Use of Funds: Payment for work initiated prior to the loan being approved and closed, unless due to emergency. Recreation or luxury projects (pools, lawn sprinkler systems, playground equipment, saunas, whirlpools, etc.), furniture, non-permanent appliances(unless part of a full kitchen remodel), and funds for working capital, debt service, homeowner labor or refinancing existing debts are NOT allowed. Bids: Only one estimate is required. All contractors must be properly licensed. Sweat Equity / Homeowner Labor: Work may be performed by property owners on a “sweat equity” basis. Loan funds may be used only for the purchase of materials and to rent tools/ equipment, but not to compensate for labor. Remodeling Advisor Visit (RAV): The Remodeling Advisor Visit provides rehabilitation and/or remodeling advice upon request of the resident. The intent is to help residents improve their homes by providing technical assistance before and during the bidding and construction process. All “Eligible Properties” are eligible for this service. This visit is not required and would be paid by the borrower(s).