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6 ; <br /> Recavture/Resale Provisions <br /> The HOME funds used to subsidize the acquisition, and/or rehabilitation of dwelling units for the <br /> purpose of facilitating affordable homeownership shall be recaptured out of the net proceeds from <br /> sale of the property during the period of affordability. If the net proceeds are not sufficient to <br /> recapture the full HOME investment plus enable the owner to recover the amount of the owner's <br /> down payment, principal payments, and any capital improvement investment (home <br /> improvements), recapture provisions for the HOME investment may be reduced. <br /> Additionally, the HOME investment amount will be reduced prorata based on the time the owner <br /> has owned and occupied the unit measured against the required Period of Affordability. Provided <br /> that the owner complies with the Terms of the Deed of Trust and Declaration of Deed <br /> Restrictions, and so long as the property is used for affordable housing as defined in 24 CFR <br /> 92.254, the HOME investment to be recaptured shall be forgiven at the end of the Period of <br /> Affordability. <br /> Any proceeds from the sale of the dwelling acquired, constructed and/or rehabilitated will be used <br /> to create other eligible HOME projects. <br /> Encumbrances <br /> The HOME Program Deed of Trust will take a second mortgage position to the first(primary) <br /> mortgage. Orange County will not permit any additional encumbrances against the property <br /> during the Period of Affordability. Should a family wish to refinance their mortgage, they would <br /> be required to repay the second mortgage. <br /> Maximum Amount of Subsidy <br /> The maximum subsidy a potential buyer may receive is 30% of the house sales price. <br /> Responsibilities of the 501 (c)(3) Non-Profit Organization <br /> The organization sponsoring, developing, or serving as an advocate for the potential homebuyer <br /> must provide: <br /> 1. Certification that the buyer meets all eligibility criteria; <br /> 2. Evidence that primary financing has been obtained by the homebuyer; <br /> 3. Copies of all building inspections reports; and a <br /> 4. Statement of property value. <br /> The organization must also provide written evidence signed by the homeowner applicant that the <br /> program guidelines have explained to the potential homebuyer including, but not limited to, the <br /> following documents: Declaration of Deed Restrictions; Deed of Trust; and Promissory Note. <br /> No final payments will be disbursed until this information is submitted and reviewed for <br /> compliance with the policies established in these guidelines. <br />