RES 2001-1977 - Debt subordination agmt for 1122 S 15th Circle r 4• {4' /
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;o`° �a4, Planning Department
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Omaha,Nebraska 68183-0110
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''fD FE84�r August / , 2001 i�E.b A$K Telefax(402)444-6140
OMAN�.
City of Omaha Robert C.Peters
Mike Fahey,Mayor Director
Honorable President
and Members of the City Council,
Attached is a proposed Resolution authorizing the Mayor to execute a debt subordination
agreement regarding the City's interest in property located at 1122 South 15`h Circle. The terms
of the 1993 Deed of Trust securing this loan provided for the partial financing of the acquisition
of this property by Ann C. Moray, such financing consisting of a deferred payment loan in the
original amount of$10,000.00. This financing provided homeownership opportunities as part of
the redevelopment plan known as Pierce Point/Townview Terrace II (Ordinance 32490,
approved September 24, 1991).
The terms of the Agreement and Deferred Loan Promissory Note require the City's lien to be in
no less than second lien position. The terms, as modified by Council Resolution No. 363,
approved on January 23, 1998, also allow for the loan principal to depreciate 50% after ten years
from the date of the Note, June 24, 1993. Ms. Moray wishes to pay off the depreciated balance
of$5,000.00 now in return for the City's consent to subordinate the remaining $5,000.00 portion
of its loan interest to a new loan in an amount not to exceed the appraised value of the property.
The new lender is only willing to make this loan if its lien can be in first position.
Approval of this Resolution will allow for the subordination of the City's interest to a refinanced
amount not to exceed the appraised value of the property in exchange for early payment of the
$5,000.00 depreciated balance of the deferred loan. The balance of the deferred loan will remain
as a lien against the property until the expiration of the ten-year depreciation period, June 24,
2003, at which time the lien will be released. This proposed Resolution is consistent with the
precedent set on January 26, 1999, by Council Resolution No. 182.
Your favorable consideration of the attached Resolution is hereby requested.
Sincerely, Referred to City Council for Consideration:
4 1
Robert C. Peters Date Mayor's Offic /Title Date
Planning Director
P:\PLN1\2.1.11 sap.doc
EXHIBIT "A"
DEBT SUBORDINATION AGREEMENT
WHEREAS, Ann C. Moray, (hereinafter referred to as`Borrower") is now or hereafter
may be indebted to Commercial Federal Bank, (hereinafter referred to as "Bank") on account of a
loan in the amount of Sixty-five Thousand Nine Hundred and 00/100 Dollars ($65,900.00) which
indebtedness was incurred for the purpose of acquisition of property located at 1122 South 15
Circle, Omaha, Nebraska and legally described as:
Lot 3, Townview Terrace II, an Addition to the City of Omaha, as surveyed,platted and
recorded in Douglas County,Nebraska
WHEREAS, the Borrower's above-described indebtedness to the Bank is secured by a Deed of
Trust, which security interest was perfected on June 24, 1993, upon the filing of same with the
Douglas County Register of Deeds, same being recorded on June 29, 1993, in Book 4078 at Page
516; and,
WHEREAS, the Borrower is also indebted to the City of Omaha(hereinafter referred to
as "City")by virtue of a Homebuyer Program Deferred Loan made in the sum of Ten Thousand
and 00/100 Dollars ($10,000.00), which indebtedness was also incurred for the purposes of
partially financing the acquisition of the above-described property; and,
WHEREAS, the Borrower's above-described indebtedness to the City is secured by a
Deed of Trust and Promissory Note, which security interest was perfected on June 24, 1993,
upon the filing of same with the Douglas County Register of Deeds, same being recorded on June
29, 1993, in Book 4078 at Page 534; and,
WHEREAS, Residential Mortgage Services, Inc. (hereinafter referred to as "Lender")is
willing to make a loan sufficient to refinance the balance of the first mortgage/deed of trust,plus
consolidated other debts, in a total amount not to exceed the appraised value of the property,
including reasonable closing costs, the proceeds of which loan to be used solely for the
aforementioned purposes; and,
WHEREAS, the Lender is unwilling to make the above-described loan unless same could
be secured by a"first" mortgage/deed of trust; and,
WHEREAS, as authorized on l�/1
LtIL�t 7 , , 2001 by City Council
Resolution No. I t _] -7 , the City is willing to subordinate its position as a secured creditor to
that of the Lender.
NOW, THEREFORE, in consideration of the premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the Lender and the
City do hereby agree that the lien acquired by the Lender by virtue of a mortgage/deed of trust
executed in its favor by the Borrower to secure the above-referenced indebtedness shall be
deemed a first and prior lien upon the above-described property, which lien shall be superior to
the previously acquired lien of the City(as hereinabove described), as if the mortgage/deed of
trust executed in favor of the Lender had been filed with and duly recorded by the Register of
Deeds at some time prior to that of the City, further, that the City's lien shall therefore be deemed
a second lien upon said property, being subject and subordinate to that of the Lender.
IN WITNESS WHEREOF, the parties have executed this Debt Subordination Agreement
as of the date indicated below.
' i ,
ATTEST:: , '; CITY OF OMAHA, A Municipal Corporation
____aw_a% --, xia f-a/
G)°l177 CITY CLERK e MAYOR OF THE CI OF OMAHA
•
STATE OF .4 1_ EBRA:SKA )
, ) ss.
COUNTY OF DOUGLAS )
On this ' - day of , 2001, before me the undersigned, a
Notary Public in and for said County,personally came -)'h-(-Au- 4-
who executed the above document, and acknowledged the execution thereof to be their voluntary
act and deed as such officer and the voluntary act and deed of the City of Omaha, a Municipal
Corporation.
In testimony whereof I have hereunto set my hand and affixed by Notary Seal at Omaha
in Douglas County, on the day and date last above written.
- GENERAL NOTARY-State of Nebraska
CYNTHIA L FORD v
•'.Am. My Comm.Exp.Aug.16,2003
NOTAR PUBLIC
My Commission expires 11/ 6o/0 3
i
RESIDENTIAL MORTGAGE
SERVICES, INC.
By
WITNESS Title
Date
STATE OF NEBRASKA )
) ss.
COUNTY OF DOUGLAS )
On this day of , 2001, before me the undersigned, a
Notary Public in and for said County,personally came
to me known to be the person named in and who executed the foregoing instrument, and
acknowledged that he/she executed the same as his/her voluntary act and deed.
In testimony whereof I have hereunto set my hand and affixed by Notary Seal at Omaha
in Douglas County, on the day and date last above written.
NOTARY PUBLIC
My Commission expires
APPROVED AS TO FORM:
act
ASSISTANT CITY ATTORNEY
�c-25At ' CITY OF OMAHA
LEGISLATIVE CHAMBER
August 7, 2001
Omaha,Nebr
RESOLVED BY THE CITY COUNCIL OF THE CITY.OF OMAHA:
WHEREAS, on September 24, 1991, a Redevelopment Agreement was approved
by City Council Ordinance No. 32490; and,
WHEREAS, under the terms of that Agreement, eligible homebuyers received
partial financing for the acquisition of single family homes, such financing consisting of a
deferred payment loan the principal of which becomes due upon sale, lease or other transfer of
any kind or nature of the mortgaged property, or any part thereof; and,
WHEREAS, on June 24, 1993, Ann C. Moray executed a deferred payment loan
Deed of Trust and Promissory Note in the amount of $10,000.00 for the purpose of partially
funding the acquisition of her property located at 1122 South 15`h Circle, such documents being
recorded on June 29, 1993, with the Douglas County Register of Deeds in Book 4078 on Page
534; and,
WHEREAS, the terms of the Deed of Trust and Promissory Note, required that
the Deed of Trust securing such financing be in no less than second lien position; and,
WHEREAS, on February 3, 1998, the City Council passed Resolution No. 363
which authorized the depreciation of homebuyer deferred payment loans for newly constructed
properties by fifty percent(50%) after ten (10) years from the date of the Promissory Note; and,
WHEREAS, the principal balance of the above-referenced deferred payment loan
is scheduled to depreciate on June 24, 2003; and,
WHEREAS, Ms. Moray has been approved for a new loan in an amount sufficient
to refinance the balance of her first mortgage, repay the depreciated balance of the deferred
payment loan, refinance some additional debts, plus cover reasonable closing costs; and,
WHEREAS, the lender is willing to make such loan provided it can be secured by
a first mortgage/deed of trust; and,
WHEREAS, it is in the best interests of the citizens of the City of Omaha that the
Mayor execute a debt subordination agreement, in a form substantially the same as the attached
Exhibit A, in return for the payment of$5,000.00 as the early depreciated balance of the deferred
payment loan; and,
By
Councilmember
Adopted
City Clerk
Approved
Mayor
' C-25A0
C•ITV O F 4O;IVIAHA
LEGISLATIVE CHAMBER
Omaha,Nebr
PAGE -2- •
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WHEREAS, the balance of the deferred payment loan will remain as a lien
against the property until the completion of the ten (10) year term on June 24, 2003.•
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF OMAHA:
THAT, the Mayor is hereby authorized to execute a debt subordination agreement
as requested by the Borrower, Ann C. Moray, regarding the City's interest in property located at
1122 South 15th Circle, reflecting the terms and conditions set forth; in this resolution, in
substantially the same form as the proposed debt subordination attached hereto.
APPROVED AS TO FORM:
CITY ATTORNEY DATE
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