2. Application Workshop for NSP-1, NSP-2 and NSP-4. 1

3.  Neighborhood Stabilization Program (NSP)  Enacted under Title III of Division B of the Housing and Economic Recovery Act of 2008 (HERA).  Created for the purpose of assisting in the redevelopment of abandoned and foreclosed homes under the heading of Emergency Assistance for Redevelopment of Abandoned and Foreclosed Homes. 2

4.  NSP Resources  www.rivcoeda.org  >Departments  >Housing  >Neighborhood Stabilization Programs  >NSP Resources link 3

5.  Tier 1.  Tier 2.  Tier 3.  Tier 4. 4

6.  Tier 1. Foreclosed vacant single-family properties in need of modest to substantial rehabilitation and marketed for resale to LMMI First-Time Homebuyers. (NSP-1)  Tier 2. Same as Tier 1, but marketed for rent with preference to Special Needs Households - Permanent Supportive Housing (not for shelters and transitional housing) for households with incomes at or below 50% AMI. (NSP-2) 5

7.  Tier 3. Foreclosed vacant single-family properties in need of relatively minor repairs. Ideal for first- time homebuyers. Neighborhood Stabilization Homeownership Program. (NSHP or NSP-3)  Tier 4. Foreclosed vacant multi-family properties in need of rehabilitation or completion of construction for rent to households with incomes at or below 50% AMI. (NSP-4) 6

8.  Step #1 7

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13.  Link to Target Area Maps 12

14.  Download and pinpoint location 13

15.  Print out and indicate location. 14

16.  Zoom In to identify streets.  Print “Current View”. 15

17. NSP-1 and NSP-2. Public and private non-profit organizations NSP-4. Public and private non-profit and for-profit organizations  Experience and competency in all tasks  Financial capacity and working capital  5 years of housing experience  Professional development experience  Able to obtain sufficient financing  Non-profits may apply with a locality, Public Housing Authority (PHA) or Community Redevelopment Agency (CRA) as a Joint Applicant with jurisdiction over the areas in which the Target Areas are located.  PHA’s may apply on behalf of cities with TAs. 16

18.  Teams of entities must demonstrate as a group the capacity to perform all the necessary services.  One entity is to be designated as the Lead Entity.  Non-profit organizations may partner with a for-profit organization, but the non-profit organization must be the Lead Entity. 17

19.  The Lead Entity must:  Hold title to the property between acquisition and sale;  Enter into an agreement with the County;  Enter into letters of agreement, memorandums of understanding, or similar agreements with the other entities in the team in order to provide the needed services for the program;  Perform all rehabilitation work pursuant to the County’s requirements;  Receive and be responsible for all funds under the program; and  Take responsibility for all required compliance and reporting. 18

20. NSP-1. No, a partial list is sufficient. Submit a revised list with changes and/or additions at Stage Two. All properties must meet eligibility requirements. NSP-2 and NSP-4. Yes, the project site must be identified. All properties must meet eligibility requirements. 19

21.  The purchase price limit cannot exceed the actual 95 percent of the area median sales price for Riverside County or FHA 203(b) limit, whichever is lower, as published by HUD.  As of March 17, 2009, the maximum program purchase price for the property limit should not exceed $292,686. 20

22.  (NSP-1 and NSP-2) Any single-family home, condominium or town home  (NSP-4) Multi-family property  Properties must meet all of the following minimum criteria:  Foreclosed or abandoned and bank-owned or REO.  Currently vacant for a period of at least 90 days prior to application initial offer. *URA relocation and displacement requirements apply.  Constructed post-1978 and must not be listed on, or eligible for listing on, the National Register of Historic Places.  Assessed in accordance with the provisions of the National Environmental Policy Act of 1969 (NEPA).  Single-Family homes with in-ground pools or spas are eligible for acquisition. 21

23. 22 Loan Committee Review (1 week) Pre-Approval Letter Initial Notice & Offer (Open Escrow, PTR) Appraisal (15 days or more) Final Notice (negotiation required?) Final Offer (PTR, PSA, escrow instructions) Prepare Loan Agreement Board Approval of Loan Agreement Close Escrow SHPO (30 days) NEPA Review – Environmental Assessment Public Noticing for FONSI/NOI-RROF (15 days) Board Approval of FONSI/RROF Request for Release of Funds from HUD (15 days)

24. Loan Committee Review (1 week) Loan Agreement (NSP Allocation) Board Approval of Loan Agreement (2 to 3 weeks) Property submission/re-submission Eligibility and NEPA Review (SHPO 30 days starts)  Categorical Exclusion pending answers to questionnaire.  Converts to Exempt if no impacts.  No public noticing, No FONSI, No RROF, No amend OYAP. Initial Notice & Offer (Open Escrow) Appraisal (10 days) Final Notice (Re-negotiation required?) Final Offer (PTR, PSA, & Escrow Instructions) SHPO cleared? If so, EXEMPT. Close Escrow 23

25.  Stage One – Applicant and Project Identification  Stage Two – Acquisition Initial Notice and Offer  Stage Three – Acquisition Final Notice and Offer  Stage Four – Rehabilitation or Construction  Stage Five NSP-1. Resale to First-Time Homebuyer NSP-2 and NSP-4. Rental of Affordable Units. 24

26.  Application Applicant Information Development Team Project Summary Location Maps and Photographs Project Timeline Rehabilitation Plan Marketing Strategy Certification, Disclosure Questionnaire Letter of Support from the City* Initial Project Budget 25

27.  Letter of Pre-Approval Conditionally approves funding amount subject to meeting NSP requirements. EDA reserves the right to reject any or all proposals, in whole or in part. As the funding is time-sensitive, EDA reserves the right to re-allocate any returned funds, unobligated or unused funds during the project and set funds aside for performance based developers.  Loan Agreement Funding disbursements will be contingent upon meeting all NSP requirements including Environmental Review. 26

28.  NSP Assistance will be in the form of zero percent (0%) interest loans.  Loan Term: NSP-1 and NSP-2: Fifteen (15) months. NSP-4: Fifty-five (55) years. 27

29.  NSP-1: 15 yrs from the close of escrow  NSP-2: 55 yrs from the certificate of occupancy  NSP-4: 55 yrs from the certificate of occupancy 28

30.  Appraisals  Preliminary title reports  Acquisition costs  Rehabilitation costs  Demolition  Reasonable sales commission  Customary closing costs  Homebuyer education  Reasonable developer fee  Carrying and delivery costs 29

31.  Ineligible under CDBG is ineligible under NSP.  Administration and Operating costs.  Foreclosure Prevention. 30

32. EDA will pay for appraisal costs as follows:  If the property’s purchase price does not meet the minimum 15% discount below the CMAV, then EDA will only pay up to $1,500 per property*, a maximum $15,000 per Applicant, of which will be paid by EDA. Beyond that amount, the Sub-recipient must pay for the cost of subsequent appraisals.  If the property’s purchase price does meet or exceed the minimum 15% discount below the CMAV, then the cost of appraisal will be paid from the closing costs budget for the project. 31

33.  $100k for Acquisition  $200k for Rehabilitation  Market Value $150k 32

34.  The Sub-recipient is required to sell each home to a Qualified Homebuyer and repay EDA with the proceeds from the sale.  The Resale Price of each property shall not exceed the lesser of (a) the fair market value; or (b) the total costs to acquire, rehabilitate and dispose the property per NSP regulations. 33

35.  Upon transfer of ownership to the Qualified Homebuyer, the amount of the Homebuyer Loan minus closing costs will be returned to EDA.  If necessary, a trust deed shall be recorded to secure the second mortgage loan  Repayment is required if the property is no longer the principal residence or the property is sold prior to the expiration of the affordability period.  NSP-3 assistance, or NHSP, cannot be used for first- time homebuyer assistance. 34

36.  Each Qualified Homebuyer will obtain a loan for up to the Resale Price (the “Homebuyer Loan”).  If the Homebuyer Loan is less than the Resale Price, then the Qualified Homebuyer will receive the difference as a “Silent Second Mortgage” from EDA.  The Silent Second Mortgage is limited to 30% of the resale price and capped for a maximum amount of $75,000. 35

37.  Application Revisions or Submission of New Properties Changes, deletions and/or additions to the list of properties. Must meet eligibility requirements Bulk purchases must identify purchase prices for each property. Revised Project Budget. The BOS approved NSP funding allocation cannot be exceeded. Changes to the Project Timeline, Rehabilitation Plan and/or Marketing Plan.  Completion of Environmental Review Questionnaire.  Property Eligibility Review  Initial Notice and Offer  Current Market Appraised Value 36

38. 1. Voluntary Acquisition of Foreclosed Property 2. Initial Notice – acknowledged & signed 3. Initial Offer – the initial purchase price 4. Appraisal 5. Final Notice – negotiation required? 6. Final Offer 37

39.  Final Notice and Offer  Closing of Escrow  Final Budget 38

40.  Reimbursement of rehabilitation costs is paid as costs are incurred.  Status Reports  Final Budget 39

41.  Market property. Marketing and outreach.  Homebuyer qualifications for approval.  Obtain homebuyer loan commitment.  Sell property and close escrow.  Return balance of funds to EDA. 40

42.  Market property. Provide evidence of marketing and outreach.  Sub-recipient must submit tenant qualifications for EDA approval. Tenant Checklist.  Obtain tenant lease commitment.  Return balance of funds to EDA. 41

43.  EDA will determine whether returned funds will be lent back to Sub-recipient for additional purchases. EDA has full discretion of funding to allocate.  As the funding is time-sensitive, EDA reserves the right to re-allocate any returned funds, un-obligated or unused funds during project implementation and set funds aside for performance based developers. 42