Sec. 05.04.06.11. Loan and Grant Approval and Disapproval

A. Initial Eligibility Determination.

(1) Each application shall be submitted to the local administrator for an initial review to make a preliminary determination of the eligibility of the applicant and the project.

(2) If an applicant is determined preliminarily to be eligible for a loan or grant, an appropriate verification form shall be distributed and credit reports shall be obtained.

(3) If an applicant is determined preliminarily to be eligible for a grant or loan, the applicant may be provided with a letter from the local administrator in the form approved by the Program acknowledging receipt of the application and notifying the applicant of the ongoing review process.

(4) If the applicant is ineligible for a grant or loan, the applicant shall be informed in writing of the determination and the reasons for the determination.

B. Building Evaluation. Each building for which an application is received shall be inspected for the purpose of determining structural and mechanical soundness and evaluating the adequacy of lead hazard reduction proposals submitted by the applicant. The inspection shall be performed by:

(1) The Department;

(2) The local administrator; or

(3) Another inspector acceptable to the Department.

C. Loan and Grant Approval.

(1) Upon receipt and approval of all acceptable contractor's proposals, and all other data the Program considers relevant or necessary, the local administrator originating a:

(a) Loan shall undertake an analysis of each loan as to loan amount, interest rate, repayment provisions, and other loan terms and conditions; and

(b) Grant shall undertake an analysis of the grant amount and other grant terms and conditions.

(2) After completing the steps described in §C(1) of this regulation, a Level I local administrator, or a Level II local administrator evaluating Program financing for more than $60,000, shall forward the application package and the analysis of the loan or grant, or both, to the Department for approval, disapproval, or modification.

(3) Approval to make a loan, grant, or combination of loan and grant shall be as follows:

(a) Program financing in an amount of $60,000 or less may be approved by:

(i) The Level II local administrator, when the Level II local administrator originates the loan or grant; or

(ii) The Program Director when a Level I local administrator or the Department originates a loan or grant;

(b) Program financing in an amount over $60,000 and up to $250,000 may be approved by the Director;

(c) Program financing in amounts over $250,000 shall be submitted to the Housing Finance Review Committee in accordance with COMAR 05.01.07; and

(d) In an emergency, when urgent action is required, the Secretary may approve loans and grants by written determination without the recommendation of the Housing Finance Review Committee.

(4) Before a Level II local administrator gives final approval and issues a commitment for Program funding in the amount of $60,000 or less, the Level II local administrator shall contact the Program and receive confirmation that funds are available.

D. Loan and Grant Commitments.

(1) A commitment for a loan and grant shall be made on the form provided by the Program.

(2) A commitment shall specify a time limit for closing the loan or grant. The time limit may be extended at the discretion of the loan administrator with the approval of the Program.

(3) If the closing does not occur within the time limit, the local administrator shall notify the applicant that the commitment is officially canceled.

E. Rejection. If an application is rejected, the Department, or local administrator, as the case may be, shall notify the applicant in writing of the rejection and the reasons for it.

F. Reconsideration. An applicant who is rejected may request reconsideration of a rejection in accordance with the procedures contained in the Program guidelines. An initial decision or reconsideration of a decision is not a contested case within the meaning of the Administrative Procedure Act or COMAR 05.01.01.

G. Withdrawal of Application. An applicant may withdraw an application at any time before closing by delivering written notice to the Department or the local administrator originating the loan or grant. The applicant shall bear any costs incurred for items other than internal processing, including, but not limited to, title examinations, credit reports, and appraisals.

H. Cancellation of Application.

(1) The Program or the local administrator may cancel an application at any time during processing if the applicant fails to provide any information requested.

(2) Notification of the cancellation of an application, and the reasons for it, shall be in writing.

(3) A canceled application may be reinstated upon the applicant's written request within 60 days following the date of the cancellation.