Sec. 05.12.02.07. Terms and Conditions of Financial Assistance

A. Occupancy Requirements and Income Restrictions.

(1) For residential rental projects, all of the residential rental units financed with FAF funds shall be rented only to very low-income households.

(2) For homeownership projects, the recipients of FAF Funds shall be very low-income households.

(3) For homeownership projects subsidized with FAF Funds, if the Administration makes ongoing grants or subsidies from FAF Funds, the Administration shall recertify every 2 years that the recipients continue to be very low-income households and continue to occupy the unit.

(4) Term of Income Restrictions.

(a) All residential rental projects subsidized with FAF Funds shall be income-restricted for a minimum of 10 years.

(b) All homeownership units subsidized with FAF Funds shall be owned and occupied by the recipient of the FAF funds at the time the financial assistance is received.

(5) Inspection by HUD. The sponsor shall agree to permit HUD to inspect the units financed with FAF funds at reasonable times during business hours and under reasonable conditions.

B. Repayment.

(1) Repayment shall be made as provided in the loan documents.

(2) Interest and principal repayment may be deferred at the discretion of the Department, in accordance with the terms and provisions of the loan documents.

C. Lien Priority. Except for liens held in connection with public purpose projects, any lien held by the Administration on property is a lien superior to all other liens on the property except liens for taxes owed to the State or any subdivision of the State, and earlier mortgage liens. The Administration, in its discretion, may require the release and repayment of any liens.