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HomeMy WebLinkAboutAgr 1993-11-01 (Kleinert)RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO F ^+•m• Town of Tiburon Str"t 1155 Tiburon Blvd. Add" Tiburon, CA 94920 City d st,t. L-Attention: Robert Ewing J TO 1538 A (1.84) SPACE ABOVE THIS LINE FOR RECORDER'S USE Escrow No. 513862-T.n NOTICE: THIS SUBORDINATION AGREEMENT RESULTS IN YOUR SECURITY INTEREST IN THE PROPERTY BECOMING SUBJECT TO AND OF LOWER PRIORITY THAN THE LIEN OF SOME OTHER OR LATER SECURITY INSTRUMENT. THIS AGREEMENT, made this 15t day of November 19 93 b Robert L. Kleinert and Trudy G. Kleinert y owner of the land hereinafter described and hereinafter referred to as "Owner" and Town of Tiburon, a Municipal Corporation - , present owner and holder of the deed of trust and note first hereinafter described and hereinafter referred to as "Beneficiary"; WITNESSETH THAT WHEREAS, Robert L. Kleinert and Trud G. Kleinert husband and wife did execute a deed of trust, dated December 14, 1983 'to Pacific Coast Title Company of Marin, a Corporation as trustee, covering: PARCEL ONE: Parcel 2, as shown upon that certain Parcel Map entitled "Parcel Map, Division of Lands of Town of Tiburon:, filed for record August 19, 1981 in Book 19 of Parcel Maps, at Page 70, Marin County Records. PARCEL TWO:, An easement for utility purposes over that certain "10' Utility Easement for Parcel 2", as shown upon that certain Map entitled, "Parcel Map, Division of Lands of Town of Tiburon", filed for record August 19, 1981 in Book 19 of Parcel Maps, at Page 70, Marin County Records. A.P. No. 38-302-02 to secure a note in the sum of $ 125 , 000.00 , dated December 14, 1983 Town of Tiburon, a Munici al Cor oration , in favor d of trust was recorded February 1, 1983 , which deed , in of said county; and Series No. 83-005168 book N A page N A Official Records WHEREAS, Owner has executed, or is about to execute, a deed of trust and note in the sum of $ , dated in favor of hereinafter referred to as "Lender", payable with interest and upon the terms and conditions described therein, which deed of trust is to be recorded concurrently herewith; and WHEREAS, it is a condition precedent to obtaining said loan that said deed of trust last above mentioned shall unconditionally be and remain at all times a lien or charge upon the land hereinbefore described, prior and supericr to the lien or charge of Uhl- deed of trust first above.meationed; and WHEREAS, Lender is willing to make said loan provided the deed of trust securing the same is a lien or charge upon the above described property prior and superior to the lien or charge of the deed of trust first above mentioned and provided that Beneficiary will specifically and unconditionally subordinate the lien or charge of the deed of trust first above mentioned to the lien or charge of the deed of trust in favor of Lender; and WHEREAS, it is to the mutual benefit of the parties hereto that Lender make such loan to Owner; and Beneficiary is willing that the deed of trust securing the same shall, when recorded, constitute a lien or charge upon said land which is unconditionally prior and superior to the lien or charge of the deed of trust first above mentioned. NOW, THEREFORE, in consideration of the mutual benefits accruing to the parties hereto and other valuable consideration, the receipt and sufficiency of which consideration is hereby acknowledged, and in order to induce Lender to make the loan above referred to, it is hereby declared, understood and agreed as follows: (I) That said deed of trust securing said note in favor of Lender, and any renewals or extensions thereof, shall unconditionally be and remain at all times a lien or charge on the property therein described, prior and superior to the lien or charge of the deed of trust first above mentioned. SUBORnINATInNI [?Grnoncn ncr.,~ yr 1 vai iU ur,r,u Ur TRUST TO RECORD- 62-LD (2) That Lender would not make its loan above described without this subordination agreement. (3) That this agreement shall be the whole and only agreement with regard to the subordination of the lien or charge of the deed of trust first above mentioned to the lien or charge of the deed of trust in favor of Lender above referred to and shall supersede and cancel, but only insofar as would affect the priority between the deeds of trust liereinbefore specifically described, any prior agreements as to such subordination, including, but not limited to, those provisions, if any, contained in the deed of trust first above mentioned, which provide for the subordination of the lien or charge thereof to another deed or deeds of trust or to another mortgage or mortgages. Beneficiary declares, agrees and acknowledges that (a) He consents to and approves (i) all provisions of the note and deed of trust in favor of Lender above referred to, and (ii) all agreements, including but not limited to any loan or escrow agreements, between Owner and Lender for the disbursement of the proceeds of Lender's loan; (b) Lender in making disbursements pursuant to any such agreement is under no obligation or duty to, nor has Lender represented that it will, see to the application of such proceeds by the person or persons to whom Lender disburses such proceeds and any application or use of such proceeds for purposes other than those provided for in such agreement or agreements shall not defeat the subordina- tion herein made in whole or in part; (c) He intentionally and unconditionally waives, relinquishes and subordinates the lien or charge of the deed of trust first above mentioned in favor of the lien or charge upon said land of the deed of trust in favor of Lender above referred to and understands that in reliance upon, and in consideration of, this waiver, relinquishment and subordination specific loans and advances are being and will be made and, as part and parcel thereof, specific monetary and other obligations are being and will be entered into which would not be made or entered into but for said reliance upon this waiver, relinquishment and subordination; and (d) An endorsement has been placed upon the note secured by the deed of trust first above mentioned that said deed of trust has by this instrument been subordinated to the lien or charge of the deed of trust in favor of Lender above referred to. NOTICE: THIS SUBORDINATION AGREEMENT CONTAINS A PROVISION WHICH ALLOWS THE PERSON OBLIGATED ON YOUR REAL PROPERTY SECURITY TO OBTAIN A LOAN, A PORTION OF WHICH MAY BE EXPENDED FOR OTHER PURPOSES THAN IMPROVEMENT OF THE LAND. TOWN OF-TIBURON, A Municipal Corporation BY: y Beneficiary Robert L. Kleinert Trudy G. einert Owner (ALL SIGNATURES MUST BE ACKNOWLEDGED) IT IS RECOMMENDED THAT, PRIOR TO THE EXECUTION OF THIS SUBORDINATION .AGREEMENT, THE PARTIES CONSULT WITH THEIR ATTORNEYS WITH RESPECT THERETO. (CLTA SUBORDINATION FORM "A") ;•I f Cdr"Cbtl~ LC L) r-V I'-l / 1 u ~t d C- ~ E L._ C_ , GC !L C.I ~C c~ c...~'L d ~ ~l ~ ~~1~ ~ PART V: MORTGAGE ELIGIBITTTY F KI N CHAPTER 2: CONVENTIONAL MORTGAGES (08/15/91) 215: MORTGAGES SUBJECT TO SUBORDINATE FINANCING (06/30/90) Generally, we will purchase or securitize first mortgages that are subject to subordinate financing held by another investor as long as the lien is recorded and clearly subordinate to our mortgage lien. However, we will not purchase or securitize a cooperative share loan that is subject to subordinate financing. If subordinate financing involves the use of a home equity line of credit, the property must be an owner- occupied principal residence. Lenders must disclose subordinate financing repayment terms to us, the appraiser, and the mortgage insurer. 215.01: REPAYMENT TERMS (06/30/90) The repayment terms for any type of subordinate financing must provide for regular payments that cover at least the interest due so that negative amortization will not occur. Generally, the terms of the subordinate financing should require interest at a market rate, although financing by the property seller may be at a below-market rate. (For subordinate financing that does not involve a home equity line of credit, a market rate is one that is no more than 2% below the posted net yield we have in effect for second mortgages at the time the subordinate financing is closed.) In addition, the subordinate financing must permit prepayment at any time without penalty. If the first mortgage is an adjustable-rate mortgage, a graduated- payment mortgage, or a fixed-rate mortgage that is subject to an interest rate buydown plan, the payment for the subordinate financing must be for a fixed amount. In other instances, payments acceptable. When the repayment terms for subordinate than that related to home equity lines of credit) provide for a interest rate, the monthly payment must remain constant for month period over the term of the mortgage. Then, the change in the monthly payment at the end of each 12-month period cannot represent more than a 1% increase in the interest rate. If the subordinate financing will not fully amortize under a level monthly spearlier than ayment plan, it may not is have a maturity or balloon payment date that maturity or balloon payment date of less than five years. Variable payments are also acceptable for most subordinate financing that involves a home equity line-of-credit loan that is clearly subordinate to the first mortgage that is being delivered to us. However, if the first mortgage that is being delivered to us is an adjustable-rate mortgage that has a combined the first mortgage and the line-of-credit loan) greater than 80%, variable payments will not be acceptable for an equity line-of-credit loan that will be used to help finance the purchase of the property. CHAPTER 14: HOME MORTGAG~ ELIGIBILITY REQUIREMENTS: FINANCING, SECONDARY FINANCING, CREATIVE FINANCING, SECOND HOMES, AND INCLUSIONARY ZONING (06/25/93) I- H LJAC. 1402: PURCHASE MORTGAGES WITH SECONDARY FINANCING (06/25/93) Secondary financing secured by a lien junior to a mortgage delivered to Freddie Mac is permitted if the following requirements are met: (a) Maximum LTV and TLTV ratios. See section 1303 {See ALLREGS 3-4-31 for maximum LTV and TLTV ratios. (b) Maturity date. The maturity date or amortization basis of the junior lien must not be less than five years after the date of the note delivered to Freddie Mac, unless the junior lien is fully amortizing. If the junior lien contains a balloon or call option within the five-year period, the first mortgage is ineligible for purchase. (c) Prepayment. The junior lien must allow prepayment in full or in part at any time without a prepayment premium. (d) Scheduled payments. Terms of the secondary financing must provide for regular monthly payments sufficient to meet the interest due. Payments must be fixed if the first.mortgage is an ARM, or if the first mortgage is affected by a buydown plan. Refer to subsection (e) of this section if the secondary financing is an equity line. Terms of the secondary financing may provide for a variable interest rate if the interest rate of the first mortgage is fixed and both of the following additional conditions are met: * The monthly payment must remain constant for each 12-month period over the term of the junior lien. * The change in the monthly payment at the end of a 12-month period cannot represent more than a 1 percent increase in the interest rate. (e) Equity lines. Equity line junior liens must meet the secondary financing requirements in subsections (a), (b) and (c) of this section. However, total financing must be calculated using the amount of the equity line limit rather than the outstanding balance of the equity line. The requirements to be met regarding scheduled payments for equity line liens include * The terms of the equity line financing must provide for regular monthly payments sufficient to meet the interest due. * Variable payments are allowed if any of the following conditions exists: The interest rate of the first mortg, j~e is fixed. F F Equity line funds are not used to help finance the P 2 of z purchase of the property. The TLTV is 80 percent or less. Terms of the secondary financing must be disclosed to Freddie Mac on Form 65, to the appraiser, and to the mortgage insurer. Payments on the secondary financing must be included in the borrower's monthly housing expense. 1402.1: REFINANCE MORTGAGES WITH SECONDARY FINANCING (06/25/93) Junior liens (including equity lines) that are not paid off from the proceeds of the refinance mortgage delivered to Freddie Mac are permitted if the following requirements are met: * The existing junior lien must be subordinated to the first mortgage established by the refinance. * The junior lien must have scheduled payments sufficient to meet the interest due. Terms of the secondary financing must be disclosed to Freddie Mac on Form 65, to the appraiser, and to the mortgage insurer. Payments on the secondary financing must be included in the borrower's monthly housing expense. Refer to sections 1401 and 1401.1 {See ALLREGS 3-2-66, 3-2-7 and 3-2-81 for specific requirements pertaining to refinance mortgages. Refer to section 1303 ISee ALLREGS 3-4-31 for specific requirements pertaining to maximum LTV and TLTV ratios.