e designated purchaser of- the property shall
cessed for eligibility for a 10 -interest rehabi-
1 loan throug either a Federal, State, or local
m 0 provide the financial assistance necessary
iieve the repairs to the property. If a locally
ed loan . s used the interes rate of the loan
, either three percent or up to nine percent with
rnbi household incomes of the applicant's
determining factor. 0 rehabilitation
ill be provided to the purchaser of the
ty.
OG
Prior to purchasing any property for the program
the Board sh II ha e determ ined that rehabilitation of
the property is structurally and financially feasible.
The Board shall prepare a rehabilitation analysis
hich details the nature of the work to be performed,
JS ell as estimates the cost increases hich may take.
place (due to inflation) during the course of the
rehabilitation. That analysis shall be available to all
interested appl icants.
As conditions for participation in urban home­
steading, the following requirements exist:
1.
The homesteader must agree to complete all
required rehabilitation work within a specifi­
ed period of time. This period of time shall be
negotiated between the Board and the home­
steader, but in no case shall that ttime exceed
eighteen (18) months from the date on which
the property is occupied by the homesteader.
As a general guideline, particularly in cases
where all the repairs are beinq performed
under contract(s), all ork must be complet­
ed with in six months of the execution of the
"Horneste der's Agreement." Extensions to
. this six-month period shall be granted depend­
. ing on the extent of the purchaser's personal
involvement in the rehabilitation of the
property through "s eat equity."
2. Work shall begin within 30 days f the
execution of "Homesteader's Agreement."
3.
. The property shall be exempt from the
enforcement of the City's Housing Main­
tenance Code (except for items relating to
plumbing, heating, electrical and environ­
mental conditions once occupancy has
commenced) until a certificate of comple­
tion is ussued. The homeSteader must agree
to permit periodic inspections at mutually
agreed upon times by City .Inspectors and/
or City Rehabilitation Counselors for the
purpose of determining the quality and
progress of the work.
5. After completion of the scheduled rehabili­
tation work in accordance with the "Home­
steader's Agreement", the homesteader shall
be issued a certificate of completion and
granted fee simple title to the property from
the City for 1.00.
c
To reduce the potential financial burden, each
homesteader shall be encouraged to perform some
of he work. In the event "sweat equity" is being
performed, neighborhood orqanizatlons shall be
encouraged to seek .out, on behalf of the home­
steader, technical expertise in various aspects of the
rehabilitation: The Board will develop a working
arrangement ith the City of Benton Harbor
Inspections Department or other appropriate
agency(s) to assist homesteaders in making correct
and sound repairs.
ajor code items such as plum bing, hea ing,
and electrical shall be corrected with in 90
days from the date of work commencement. In the event of a hardship, the City/Board may
Occupancy may not commence until those waive the repayment provision upon the recommen­
items re ating to the health and safety of the dation of the Board.
pu rchaser have been corrected and an occu- .
pancy certificate issued by the City. (9) In the event the homesteader should be
requ ired to vacate the property prior to
obtaining fea simple title, the City/Board shall
make every effort to ensure that the home­
steader is able to recover expenses encounter­
ed relating to the progress that the home­
steader achieved toward rehabilitating the
o
u
(6) The homesteader shall be encouraged to
occupy the property for a period of three
years after obtaining fee simple title.
(7) Because this program is intended to provide
homeownership opportunities, the home­
steader may not vacate the property and
retain ownership of the property and utilize
it to produce income .•
(8) In the event the homesteader sells the proper­
ty within three years from the date on which
the homesteader shall pay to the City a per­
centage of any increased value the homestead­
er may receive upon the sale of that property.
The amount to which that percentage would
be applied would be derived by subtracting
the indebtedness which the homesteader
originally incurred at the time of property
purchase .. (total of mortgage principal, if
any, and rehabilitation loan principal) plus
any expenses incurred by the homesteader to
market the property from the price at wh ich
the homesteader sold the property. The per­
centage paid to the City shall be based upon
the following schedule:
a. If sold within first year since obtaining
title, 90%;
b. If sold during second year since obtaining
title, 60%;
c. If sold during third year since' obtaining
title, 30%.
structure.
(10) I n cases where properties are received by the
Benton Harbor Housing Commission through
Section 810 of the Housing and Community
Deveiopment Act of 1974, provisions No.8
and No. 9 as cited above Shall not apply. In
these cases the homesteader shall be required
to occupy the property for a period of three
(3) years commencing with the date on which
the property is occupied by the homesteader,
subject to the following conditions:
a. I f the homesteader vacates the property
prior to receiving_ title, the Board Shall
s
. -
To further reduce the potential financial burd
to the homesteader, the first payment on a loan being
provided through the City's Housing Rehabilitation
Program shall not be requ ired until the second mon h
following the date on which the-Board certifies that
the structure is ready for occupancy or as a maximum
six months after the execution of the "Homesteader's
Agreement."
then either ( 1) re-market the property
through urban homesteading and the
subsequent homesteader shall be proces­
sed for assumption of the initial rehabili­
tation loan or (2) complete the rehabilita­
tion work. re-market the property with
permanent mortgage financing and repay
the remaining balance of the initial rehabi­
litation oan.
b. I f the homesteader vacates the property
after receiving title, but prior to the
expiration of the three-year occupancy
period, title to the property shall revert
to the City. The Board shall then either
(1) re-market the property through urban
homesteading and the subsequent home­
steader shall be processed for assumption
of the initial rehabilitation loan or (2)-.......·-,--'-_ ..
re-market the property with permanent
mortgage financing and repay the remain­
ing balance of the initial rehabilitation
loan.
{ll)The homesteader shall agree to maintain the
dwelling after completion of rehabilitation so
as to satisfy all electrical, plumbing, building,
fire prevention, and related codes.
(12)During the rehabilitation period, the City
shall maintain adequate "all perils" insurance
on the property. Once receiving title to the
property, the homesteader shall agree to carry
adequate perils and liability insurance on the
structure at all times. The City shall be
named as co-insured on such coverage as long
s the Ci"ty is maintained as the mortgagee.
(13) I n the event the homesteader is an owner­
occupant of the property in which the home­
steader currently resides, the homesteader
shall be required to sell the pre iously occu­
pied property after assuming occupancy of
the homestead property in order to relieve
the potential burden pf owning and maintain­
ing both properties.
(14)The homesteader shall agree to comply with
such additional reasonable terms as the Board
may designate in order to insure that the
rehabilitation of the property is successfu lIy
completed.
(IS) If, during any time while the agreed upon
rehabilitation is being performed: an insp -
tion reveals the homesteader's inabil ity or
unwillingness to complete the required work,
the homesteade may be required to contract
the work (either with a contractor or a
neighborhood group) or to vacate the proper­
ty under the remedies provided in the "Home­
steader's Agreement ...
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