(a) A loan made under the program must be used to finance closing costs for the purchase of a single family residence by an eligible homebuyer.
(b) The maximum loan amount must not exceed the lesser of:
(1) 5 percent of the sale price of the single family residence; or
(2) $7,500.
(c) An eligible homebuyer must sign a promissory note for a loan. The Executive may require other security for a loan.
(d) A loan should include terms that the Executive considers necessary to make housing purchases affordable to eligible homebuyers. The Executive must establish by regulation an interest rate for loans based on a benchmark representing the County's cost of borrowing, such as the rate the County pays on a recent issue of County general obligation bonds.
(e) In approving a loan, the Executive must:
(1) consider the eligible homebuyer's financial resources, including savings available to pay the closing costs, in relation to the purchase price of the home and the down payment requirements of any other lender; and
(2) give a high priority to homebuyers of low income or who buy single family residences in areas with a low rate of homeownership, determined according to criteria in Executive regulations.
(f) The Executive must require that a loan becomes due and payable when the single family residence is sold or transferred or no longer serves as the eligible homebuyer's primary residence. The Executive may waive a requirement of this subsection if the requirement would impose financial hardship on an eligible homebuyer.
(g) If a borrower defaults on a loan, the Executive may modify the rate of interest, the time or amount of payment, or any other term of a loan to assure repayment of the loan and achieve the purpose of the program.
(h) A loan should comply with all applicable federal and State guidelines to enable sale of the underlying mortgage in the secondary market when the lender expects to sell the mortgage. (1990 L.M.C., ch. 17, § 1; 1997 L.M.C., ch. 6, § 1.)
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