[HISTORY: Adopted by the Borough Council of the Borough of
Middletown 9-9-2008 by Ord. No.
1239, approved 9-9-2008.[1] Amendments noted where applicable.]
GENERAL REFERENCES
Uniform Construction Code — See Ch. 114.
Property maintenance — See Ch. 210.
Rental property — See Ch. 219.
Taxation — See Ch. 243.
[1]
Editor's Note: Section 2 of this ordinance provided that Res.
No. 240 of 1993 is codified as part of this ordinance and all existing
loans under the Homestead Loan Program or any preexisting loan programs
shall continue under the terms and conditions of the documents signed
by the parties at the time. To the extent that no documents exist,
this ordinance shall control.
A program of the Borough of Middletown has been created known
as the "Homestead Loan Program." The purpose of the program is the
improvement of housing stock in Middletown; to promote an increased
vitality of neighborhoods; and to provide decent, safe, sanitary,
single-family housing that is in conformance with the Code of Ordinances
of the Borough of Middletown and the Borough's Comprehensive Plan,
as may be amended from time to time.
As used in this chapter, the following terms shall have the
meanings indicated:
A person who holds the legal or equitable title to any parcel
of real estate located in the Borough of Middletown or who holds the
equitable or legal title to any improvements on real estate or any
building located in the Borough of Middletown but does not maintain
primary residence at that real estate.
The Borough of Middletown, Dauphin County, Pennsylvania.
That employee of the Borough appointed to the position of
Secretary pursuant to the Borough Code.
The Code Enforcement Officer of the Borough of Middletown,
Dauphin County, Pennsylvania.
The creation of a single-family dwelling in a property that
was previously a multifamily dwelling.
The Finance Director of the Borough of Middletown, Dauphin
County, Pennsylvania.
The lending of funds in exchange for a mortgage agreement
and promissory note.
A dwelling having more than one household or more than one
independent outside access to separate living areas not otherwise
easily accessible, or more than one party wall in common with adjoining
dwellings.
A dwelling having only one household from ground to roof,
independent outside access, one side yard and not more than one party
wall in common with an adjoining dwelling.
A person who has the use, either by himself or with others,
of a dwelling unit owned by a person other than himself.
The funding for the Homestead Loan Program is derived from residential,
rehabilitation loan repayments for loans previously granted through
federally funded projects. All monies accrued through loan repayments
and/or interest earnings shall be set aside in a special account,
referred to as the Homestead Program Account for the specific purpose
of supporting community redevelopment through the Homestead Loan Program
in accordance with the policies herein. The Finance Director shall
be the custodian of these funds.
Authority to approve loans shall be vested in the Homestead
Loan Program Executive Committee. Said Committee will consist of one
member of Council who will serve as the Chairperson and four members
of the general public, each of whom shall serve a four-year term.
Those members having been appointed pursuant to Resolution Number
240 of 1993, the predecessor to this chapter, shall continue in said
capacity for the balance of their terms.
A.
It shall be the goal of this type of loan to provide low-and moderate-income
property owners with low-interest-rate loans so that single-family
dwellings in the Borough may be brought into compliance with building,
electric, sewer, or other codes as defined by the Middletown Code
of Ordinances.
B.
All loans shall be to low-and moderate-income persons (as determined
by the Section 8 income guidelines of the U.S. Department of Housing
and Urban Development for the Harrisburg-Lebanon-Carlisle Pennsylvania
MSA; or any successor housing program as administered by the Dauphin
County Housing Authority).
C.
Loans to absentee landlords shall be governed by the requirement
that all tenants within the structure for which the loan is being
applied must fall within the low-and moderate-income limits; and tenants
must continue to maintain income eligibility for the balance of the
loan term.
D.
Loans shall be in accordance with the following guidelines:
|
Loan Applicant
|
Maximum Loan
|
Annual Interest Rate
|
Maximum Term
|
|---|---|---|---|
|
Low income
|
$10,000
|
1% per annum
|
15 years
|
|
Moderate income
|
$10,000
|
2% per annum
|
10 years
|
|
Absentee landlord
|
$10,000
|
6% per annum
|
5 years
|
E.
Loans shall be awarded according to the following priorities:
|
Priority
|
Loan Category
|
|---|---|
|
1
|
Low-moderate income/code violation correction
|
|
2
|
Low-moderate income/housing renovation
|
F.
Loans shall be secured by a construction covenant agreement, promissory
note and open-ended mortgage. The costs of preparing these documents
shall be paid by the Borough. The Borrower shall be responsible for
the costs of recording the construction covenant agreement and mortgage,
which cost shall be added to the amount of the loan. The construction
covenant agreement shall place a restrictive covenant on the property
prohibiting the property from being used as anything other than a
single-family dwelling.
G.
All payments to contractors will be made directly by the Borough
on behalf of the loan recipients as submitted to the Borough Secretary.
H.
The Borough Secretary shall promulgate policies for the validation
of the applicant's credit worthiness and the appropriate cost of proposed
code or home improvements. The Borough Secretary is authorized to
request information necessary for the Executive Committee to make
a reasonable determination whether the loan should be approved.
I.
The Executive Committee may reasonably deny any request where incomplete
information has been supplied, or where, in its opinion, the total
income of the single-family residential household exceeds income eligibility,
or where the proposed code or home improvements do not meet with the
goals of this chapter.
J.
Loans shall not be made for construction activities that will convert
a single-family dwelling into a multifamily dwelling.
A.
Said loans shall be known as "conversion loans." It shall be the
goal of these loans to provide all property owners with an incentive
to convert multifamily buildings into single-family dwellings.
B.
The resulting single-family dwelling may be owner-occupied or a rental
unit but the proposed conversion project must result in a clear single-family
use, in the sole opinion of the Code Enforcement Officer.
C.
Loans can only be issued to property owners and all property owners
must consent to the borrowing.
D.
Loans shall be in accordance with the following guidelines:
|
Loan Applicant
|
Maximum Loan
|
Annual Interest Rate
|
Maximum Term
|
|---|---|---|---|
|
Property owner
|
$10,000
|
2% per annum
|
10 years
|
E.
Loans shall be secured by a construction covenant agreement, promissory
note and open-ended mortgage. The costs of preparing these documents
shall be paid by the Borough. The Borrower shall be responsible for
the costs of recording the construction covenant agreement and mortgage,
which cost shall be added to the amount of the loan. The construction
covenant agreement shall place a restrictive covenant on the property
prohibiting the property from being used as anything other than a
single-family dwelling.
F.
All payments to contractors will be made directly by the Borough
on behalf of the loan recipients as submitted to the Borough Secretary.
G.
The Code Enforcement Officer shall promulgate policies for the validation
of the applicant's conversion plan. The application shall describe
briefly the proposed work and shall give such additional information
and shall be accompanied by such drawings of the proposed work as
may be required by the Code Enforcement Officer for an intelligent
understanding of the work proposed. All permits must be issued prior
to payment of funds.
H.
The Executive Committee may reasonably deny any request where incomplete
information has been supplied, or where, in its opinion, the proposed
conversion does not meet with the goals of this chapter.
In those cases where it is necessary for the property owner
to obtain other financing sources, with permission of the Executive
Committee, the Borough Secretary may enter into a subordination agreement
whereby a junior or inferior lien position is taken with respect to
the loan mortgage. However, all costs associated with this agreement
or filing shall be the burden of the party requesting the Borough
subordinate its position.
A loan shall be considered delinquent where no payment has been
received for 30 calendar days. Upon said delinquency, a written notice
of delinquency shall be issued to the borrower. Whenever a loan becomes
delinquent for a period greater than 60 days, the Borough Secretary
shall issue a certified letter, return receipt requested, notifying
the borrower of said delinquency. A late charge of 1% per annum may
be charged to the loan for delinquent payments for mortgages issued
on or after the effective date of this chapter. Delinquent loans will
be collected upon the sale or transfer of the real estate.
The Borough Secretary shall maintain all the records associated
with this chapter.
