Sec. 05.13.07.05. General Requirements

A. Financial assistance may be used for the development costs of a business project.

B. The Administration shall establish interest rates and fees for the financial assistance based on the underwriting of each project.

C. Terms for repayment of principal and interest shall be established based on the underwriting for each project.

D. A loan shall be evidenced by a promissory note and secured by deed of trust or other security agreement in the form acceptable to the Administration.

E. Financial assistance shall be disbursed in accordance with a draw schedule approved by the Administration, which may include releasing funds upon successful inspections.

F. Borrowers shall pay any servicing fees, loan insurance premiums, bond insurance premiums, late charges, or other fees that the Administration or the loan insurer may require and that are permitted by State law.

G. Escrow Accounts. The Administration may require the borrower to make monthly deposits with the Administration for real estate taxes, insurance, mortgage insurance premiums, a reserve for replacements, and other expenses of the project.

H. Appraisal. Borrowers may be required to provide or pay for an appraisal performed by an appraiser acceptable to the Administration which shows the current value of the property and the expected value of the property after completion of the improvements.

I. The Administration may require certified financial statements for all partners, corporate borrowers, or any other individuals or entities having an interest in the project, in a form acceptable to the Administration.

J. The recipient of financial assistance shall agree not to sell, cease to own, assign, transfer, or dispose of all or any part of the business project or their interest in it, without the prior written consent of the Administration.

K. Taxes and assessments against the property which are due and payable shall be paid at or before closing.