HomeMy WebLinkAboutGalvan, Norma; 2024-08-28;Recording Requested by:
Fidelity National Title
San Diego Office
Recording requested by
and when recorded mail to:
City of Carlsbad
Housing Services Manager
1200 Carlsbad Village Drive
Carlsbad, CA 92008
No fee for recording pursuant to
Government Code Section 27383
DOC# 2024-0250575
111111111111 lllll 111111111111111111111111111111111111111111111 IIII IIII
Sep 17, 2024 01 :49 PM
OFFICIAL RECORDS JORDAN Z. MARKS,
SAN DIEGO COUNTY RECORDER
FEES: $0.00 (SB2 Atkins: $0.00)
PCOR: N/A
PAGES: 13
DEED OF TRUST AND SECURITY AGREEMENT
(City of Carlsbad Affordable Housing Resale Program)
Note to Borrower: This Deed of Trust contains provisions prohibiting assumption
THIS DEED OF TRUST AND SECURITY AGREEMENT (the "Deed of Trust")
is made as of this 281:li day of August , 2024, among Norma Galvan, a single woman,
("Borrower"), as Trustor, and Fidelity National Title & Escrow ("Trustee"), as trustee, and the
City of Carlsbad, a municipal corporation ("City"), as beneficiary.
*Borrower Address: 2671 Leighton Circle, Carlsbad, CA 92009
---· The Borrower, in consideration of the promises herein recited and the trust herein
created, irrevocably grants, transfers, conveys and assigns to the Trustee, in trust, with power
of sale, the real property located in the City of Carlsbad, State of California, described in the
attached Exhibit A (the "Property");
TOGETHER with all the improvements now or hereafter erected on the real property
described in Exhibit A, and all easements, rights, appurtenances, and all fixtures now or hereafter
attached to the property, all of which, including replacements and additions thereto, shall be
deemed to be and remain a part of the property covered by this Deed of Trust (collectively, the
"Property"); and
TOGETHER with all articles of personal property or fixtures now or hereafter attached
to or used in and about the building or buildings now erected or hereafter to be erected on the
Property which are necessary to the complete and comfortable use and occupancy of such
building or buildings for the purposes for which they were or are to be erected, including all
other goods and chattels and personal property as are ever used or furnished in operating a
building, or the activities conducted therein, similar to the one herein described and referred to,
and all renewals or replacements thereof or articles in substitution therefore, whether or not the
same are, or shall be attached to said building or buildings in any manner; and all of the
foregoing, together with the Property, is herein referred to as the "Security";
To have and to hold the Security together with acquittances to the Trustee, its successors
and assigns forever;
1010\17\2045536.2
THIS DEED OF TRUST IS SECOND
AND SUBSEQUENT TO A DEED OF
TRUST RECORDING CONCURRENTLY
HEREWITH
~ Exempt from fee per GC27388.1 due to
being recorded in connection with
concurrent transfer that is subject to the
imposition of documentary transfer tax.
TO SECURE to the City the repayment of the sums evidenced by a promissory note
in the amount FOUR HUNDRED SIXTY-EIGHT THOUSAND SIX HUNDRED FIFTY-
SEVEN DOLLARS ($468,657) executed by the Borrower in favor of the City as of the date of
this Deed of Trust ("Note");
TO SECURE to the City the payment of all other sums, with interest thereon, advanced
in accordance herewith to protect the security of this Deed of Trust; and the performance of the
covenants and agreements of the Borrower herein contained;
TO SECURE to the City the performance of the covenants and agreements of Borrower
contained in that certain Declaration of Restrictive Covenants Regarding Restrictions on
Transfer of Property, Occupancy Restrictions, Refinancing Restrictions and Option to Purchase
executed by and between the Borrower and the City of even date herewith and recorded against
the Property on, or about, the date this Deed of Trust is recorded as a lien against the Property
(the "Resale Restriction Agreement") and to secure the payment of Excess Sales Proceeds (as
defined in the Resale Restriction Agreement) and Unauthorized Rental Proceeds (as defined in
the Resale Restriction Agreement) that may become due by Borrower to City; and
TO SECURE the performance of any obligations of Borrower in any other agreements
with respect to the financing of the Property or the Security the failure of which would adversely
affect Beneficiary, whether or not Beneficiary is a party to such agreements.
BORROWER AND CITY COVENANT AND AGREE AS FOLLOWS:
1. Borrower's Estate. That the Borrower is lawfully seized of the estate hereby
conveyed and has the right to grant and convey the Security, that other than this Deed of Trust,
the Security is encumbered only by: (a) that deed of trust executed by the Borrower in
connection with a loan made to the Borrower by ~1:0,ss<::cr~:q!:fYoi-its successors and assigns
(the "First Lender"), dated Sep'hember 13 , 2024, executed by the Borrower in favor of
First Lender, and recorded in the County of San Diego on r~ngf½fE$¥WO_, and assigned
Recorder's Serial No. _______ ("First Lender Deed of Trust"), securing a promissory
note executed by the Borrower in favor of the First Lender ("First Lender Note"), to assist in the
purchase of the Property; and (b) the Resale Restriction Agreement. The Borrower agrees to
warrant and defend generally the title to the Security against all claims and demands, subject to
any declarations, easements or restrictions listed in a schedule of exceptions to coverage in any
title insurance policy insuring the City's interest in the Security. (As used in this Deed of Trust,
the term "First Lender" shall include all successors and assigns of the First Lender.)
2. Repayment of Loan; Prohibition on Assumptions. The Borrower will promptly
repay, when due, the principal, interest and other sums required by the Note and Resale
Restriction Agreement, including all principal and interest on the Homebuyer Loan (as defined in
the Note) and the Excess Sales Proceeds and Unauthorized Rental Proceeds due under the Resale
Restriction Agreement. Among other things, the Note contains the following provisions
concerning repayment of the loan under certain conditions:
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Limitations on Assumption of Note. The Borrower acknowledges that this Note
is given in connection with the purchase of the Property as part of a program of
the City to assist in the purchase of homes by very low and low income
households. Consequently, this Note is only assumable by Eligible Purchasers
(as defined in the Resale Restriction Agreement). This Note is due in full upon
all other Transfers. In the event this Note is assumed by an Eligible Purchaser,
the Eligible Purchaser shall execute a new note, which shall be in an amount
equal to the principal and Contingent Interest owed by Borrower, a new deed of
trust and a new resale restriction agreement with a restarted term in forms
approved by the City.
3. First Lender Loan. The Borrower will observe and perform all of the covenants
and agreements of the First Lender Note, First Lender Deed of Trust, and related First Lender
loan documents.
4. Resale Restriction Agreement. The Borrower will observe and perform all of the
covenants and agreements of the Resale Restriction Agreement. Among other things, the Resale
Restriction Agreement requires the Borrower to utilize the Property as the Borrower's principal
residence, and restricts: (i) the Borrower's ability to transfer the Property, or the obligations
under the Note; (ii) the Borrower's ability to refinance the First Lender Note; and (iii) the
Borrower's ability to use the Property as security for additional loans or financing. The
Borrower's failure to comply with the requirements of the Resale Restriction Agreement
constitutes a default under this Deed of Trust.
5. Charges; Liens. The Borrower will pay all taxes, assessments and other charges,
fines and impositions attributable to the Security which may attain a priority over this Deed of
Trust, by the Borrower making any payment, when due, directly to the payee thereof. The
Borrower will promptly furnish to the City all notices of amounts due under this paragraph, and
in the event the Borrower makes payment directly, the Borrower will promptly discharge any
lien which has priority over this Deed of Trust; provided, that the Borrower will not be required
to discharge the lien of the First Lender Deed of Trust or any other lien described in this
paragraph so long as the Borrower will agree in writing to the payment of the obligation secured
by such lien in a manner acceptable to the City, or will, in good faith, contest such lien by, or
defend enforcement of such lien in, legal proceedings which operate to prevent the enforcement
of the lien or forfeiture of the Security or any part thereof.
6. Insurance. The Borrower will keep the Security insured with a standard fire and
extended coverage insurance policy in at least an amount equal to the replacement cost of the
Security, but in no event less than the amount necessary to prevent the Borrower from becoming
a co-insurer under the terms of the policy.
The insurance carrier providing this insurance shall be licensed to do business in the State
of California and be chosen by the Borrower subject to approval by the City; provided, that such
approval will not be withheld if the insurer is also approved by the First Lender, the Federal
Home Loan Mortgage Corporation, Fannie Mae, Freddie Mac, the United States Department of
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Housing and Urban Development, the United States Department of Veterans Affairs, or any
successor thereto.
All insurance policies and renewals thereof will be in a form acceptable to the City and
will include a standard mortgagee clause with standard lender's endorsement in favor of the
holder of the First Lender Note and the City as their interests may appear and in a form
acceptable to the City. The City shall have the right to hold, or cause its designated agent to
hold, the policies and renewals thereof, and the Borrower shall promptly furnish to the City, or
its designated agent, the original insurance policies or certificates of insurance, all renewal
notices and all receipts of paid premiums. In the event of loss, the Borrower will give prompt
notice to the insurance carrier and the City or its designated agent. The City, or its designated
agent, may make proof of loss if not made promptly by the Borrower. The City shall receive ten
(10) days advance notice of cancellation of any insurance policies required under this section.
Unless the City and the Borrower otherwise agree in writing, insurance proceeds, subject
to the rights of the First Lender, will be applied to restoration or repair of the Security damaged,
provided such restoration or repair is economically feasible and the Security of this Deed of
Trust is not thereby impaired. If such restoration or repair is not economically feasible or if the
security of this Deed of Trust would be impaired, the insurance proceeds will be used, subject to
the rights of the First Lender, to repay the Note and all sums secured by this Deed of Trust, with
the excess, if any, paid to the Borrower. If the Security is abandoned by the Borrower, or if the
Borrower fails to respond to the City, or its designated agent, within thirty (30) days from the
date notice is mailed by either of them to the Borrower that the insurance carrier offers to settle a
claim for insurance benefits, the City, or its designated agent, is authorized, subject to the rights
of the First Lender, to collect and apply the insurance proceeds at the City's option either to
restoration or repair of the Security or to repay the Note and all sums secured by this Deed of
Trust.
If the Security is acquired by the City, all right, title and interest of the Borrower in and to
any insurance policy and in and to the proceeds thereof resulting from damage to the Security
prior to the sale or acquisition will pass to the City to the extent of the sums secured by this Deed
of Trust immediately prior to such sale or acquisition subject to the rights of the First Lender.
7. Preservation and Maintenance of Security. The Borrower will keep the Security
in good repair and will not commit waste or permit impairment or deterioration of the Security.
If there arises a condition in contravention of this section, and if the Borrower has not cured such
condition within thirty (30) days after receiving a City notice of such a condition, then in
addition to any other rights available to the City, the City shall have the right (but not the
obligation) to perform all acts necessary to cure such condition, and to establish or enforce a lien
or other encumbrance against the Security to recover its cost of curing.
8. Protection of the City's Security. If the Borrower fails to perform the covenants
and agreements contained in this Deed of Trust, the Resale Restriction Agreement, the First
Lender Note, the First Lender Deed of Trust, or if any action or proceeding is commenced which
materially affects the City's interest in the Security, including, but not limited to, default under
the First Lender Deed of Trust, the First Lender Note, eminent domain, insolvency, code
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enforcement, or arrangements or proceedings involving a bankrupt or decedent, then the City, at
the City's option, upon notice to the Borrower, may make such appearances, disburse such sums
and take such action as it determines necessary to protect the City's interest, including but not
limited to, disbursement ofreasonable attorney's fees and entry upon the Security to make
repairs.
Any amounts disbursed by the City pursuant to this paragraph, with interest thereon, will
become an indebtedness of the Borrower secured by this Deed of Trust. Unless the Borrower
and City agree in writing to other terms of payment, such amount will be payable upon notice
from the City to the Borrower requesting payment thereof, and will bear interest from the date of
disbursement at the lesser often percent (10%) or the highest rate permissible under applicable
law. Nothing contained in this paragraph will require the City to incur any expense or take any
action hereunder.
9. Inspection. The City may make or cause to be made reasonable entries upon and
inspections of the Security; provided that the City will give the Borrower reasonable notice of
inspection.
10. Forbearance by the City Not a Waiver. Any forbearance by the City in exercising
any right or remedy will not be a waiver of the exercise of any such right or remedy, nor shall
acceptance by the City of any payment provided for in the Note constitute a waiver of the City's
right to require prompt payment of any remaining principal and interest owed. The procurement
of insurance or the payment of taxes or other liens or charges by the City will not be a waiver of
the City's right to accelerate the maturity of the indebtedness secured by this Deed of Trust.
11. Hazardous Substances. Borrower shall not cause or permit the presence, use,
disposal, storage, or release of any Hazardous Substances on or in the Property. Borrower shall
not do, nor allow anyone else to do, anything affecting the Property that is in violation of any
Environmental Law. The preceding two sentences shall not apply to the presence, use, or storage
on the Property of small quantities of Hazardous Substances that are generally recognized to be
appropriate to normal residential uses and to maintenance of the Property.
"Hazardous Substances" shall mean those substances defined as toxic or hazardous
substances or hazardous waste under any Environmental Law, and the following substances:
gasoline, kerosene, other flammable or toxic petroleum products, toxic pesticides and herbicides,
volatile solvents, materials containing asbestos or formaldehyde, and radioactive materials.
"Environmental Law" shall mean all federal and state of California laws that relate to
health, safety or environmental protection.
Borrower shall promptly give City written notice of any investigation, claim, demand,
lawsuit or other action by any governmental or regulatory agency or private party involving the
Property and any Hazardous Substance or Environmental Law of which Borrower has actual
knowledge. If Borrower learns, or is notified by any governmental or regulatory authority, that
any removal or other remediation of any Hazardous Substance affecting the Property is
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necessary, Borrower shall promptly take all necessary remedial actions ·in accordance with
Environmental Law.
12. Remedies Cumulative. All remedies provided in this Deed of Trust are distinct
and cumulative to any other right or remedy under this Deed of Trust or any other document, or
afforded by law or equity, and may be exercised concurrently, independently or successively.
13. Successors and Assigns Bound. The covenants and agreements herein contained
shall bind, and the rights hereunder shall inure to, the respective successors and assigns of the
City and the Borrower subject to the provisions of this Deed of Trust.
14. Joint and Several Liability. All covenants and agreements of the Borrower shall
be joint and several.
15. Notice. Except for any notice required under applicable law to be given in
another manner, all notices required in this Deed of Trust shall be sent by certified mail, return
receipt requested or express delivery service with a delivery receipt, or personally delivered with
a delivery receipt obtained, and shall be deemed to be effective as of the date shown on the
delivery receipt as the date of delivery, the date delivery was refused, or the date the notice was
returned as undeliverable as follows:
To the Owner:
2671 Leighton Circle
Carlsbad, CA 92009
To the City:
City of Carlsbad
Housing Services Manager
1200 Carlsbad Village Drive
Carlsbad, CA 92008
Attn: Affordable Housing Resale Program
The parties may subsequently change addresses by providing written notice of the change
in address to the other parties in accordance with this section.
16. Controlling Law. This Deed of Trust shall be construed in accordance with and
be governed by the laws of the State of California.
17. Invalid Provisions. If any one or more of the provisions contained in this Deed of
Trust, Resale Restriction Agreement or the Note shall for any reason be held to be invalid, illegal
or unenforceable in any respect, then such provision or provisions shall be deemed severable
from the remaining provisions, and this Deed of Trust, the Resale Restriction Agreement and the
Note shall be construed as if such invalid, illegal or unenforceable provision had never been
contained in this Deed of Trust, Resale Restriction Agreement or the Note.
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18. Captions. The captions and headings in this Deed of Trust are for convenience
only and are not to be used to interpret or define the provisions hereof.
19. Nonliability for Negligence, Loss, or Damage. Borrower acknowledges,
understands and agrees that the relationship between Borrower and the City is solely that of a
borrower and the administrator of a municipal inclusionary housing program, and that the City
does not undertake or assume any responsibility for or duty to Borrower to select, review,
inspect, supervise, pass judgment on, or inform Borrower of the quality, adequacy or suitability
of the Security or any other matter. The City owes no duty of care to protect Borrower against
negligent, faulty, inadequate or defective building or construction or any condition of the
Security and Borrower agrees that neither Borrower, or Borrower's heirs, successors or assigns
shall ever claim, have or assert any right or action against the City for any loss, damage or other
matter arising out of or resulting from any condition of the Security and will hold City harmless
from any liability, loss or damage for these things.
20. Indemnity. Borrower agrees to defend, indemnify, and hold the City harmless
from all losses, damages, liabilities, claims, actions, judgments, costs, expenses and reasonable
attorneys' fees that the City may incur as a direct or indirect consequence of:
a. Borrower's failure to perform any obligations as and when required by the
Note, Resale Restriction Agreement, and this Deed of Trust; or
b. the failure at any time of any of Borrower's representations or warranties
to be true and correct.
This provision shall survive the term of this Agreement.
21. Default; Remedies. Upon the Borrower's breach of any covenant or agreement of
the Borrower in the Note, Resale Restriction Agreement or this Deed of Trust, including, but not
limited to, the covenants to pay, when due, any sums secured by this Deed of Trust, the City,
prior to acceleration, will send, in the manner set forth in Section 15 of this Deed of Trust, notice
to the Borrower specifying: (1) the breach; (2) if the breach is curable, the action required to
cure such breach; (3) a date, not less than thirty (30) days from the date the notice is effective as
set forth in Section 15 of this Deed of Trust, by which such breach, if curable, is to be cured; and
(4) if the breach is curable, that failure to cure such breach on or before the date specified in the
notice may result in acceleration of the sums secured by this Deed of Trust and sale of the
Security. Notice shall be effective as of the date shown on the delivery receipt as the date of
delivery, the date delivery was refused or the date the notice was returned as undeliverable. The
notice will also inform the Borrower of the Borrower's right to reinstate after acceleration and the
right to bring a court action to assert the nonexistence of default or any other defense of the
Borrower to acceleration and sale.
If the breach is not curable or is not cured on or before the date specified in the notice, the
City, at the City's option, may: (a) declare all of the sums secured by this Deed of Trust to be
immediately due and payable without further demand and may invoke the power of sale and any
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other remedies permitted by California law; (b) either in person or by agent, with or without
bringing any action or proceeding, or by a receiver appointed by a court, and without regard to
the adequacy of its security, enter upon the Security and take possession thereof ( or any part
thereof) and of any of the Security, in its own name or in the name of the Trustee, and do any
acts which it deems necessary or desirable to preserve the value or marketability of the Security,
or part thereof or interest therein, increase the income therefrom or protect the security thereof.
The entering upon and taking possession of the Security shall not cure or waive any breach
hereunder or invalidate any act done in response to such breach and, notwithstanding the
continuance in possession of the Security, the City shall be entitled to exercise every right
provided for in this Deed of Trust, or by law upon occurrence of any uncured breach, including
the right to exercise the power of sale; ( c) commence an action t~ foreclose this Deed of Trust as
a mortgage, appoint a receiver, or specifically enforce any of the covenants hereof; ( d) deliver to
the Trustee a written declaration of default and demand for sale, pursuant to the provisions for
notice of sale found at California Civil Code Sections 2924, et seq., as amended from time to
time; or ( e) exercise all other rights and remedies provided herein, in the instruments by which
the Borrower acquires title to any Security, or in any other document or agreement now or
hereafter evidencing, creating or securing all or any portion of the obligations secured hereby, or
provided by law.
The City shall be entitled to collect all reasonable costs and expenses incurred in pursuing
the remedies provided in this paragraph, including, but not limited to, reasonable attorney's fees.
22. Acceleration. Upon the occurrence of a default under the Note, the Resale
Restriction Agreement, this Deed of Trust, the First Lender Note, or the First Lender Deed of
Trust, the City shall have the right to declare the full amount of the principal along with any
interest under the Note immediately due and payable. Any failure by the City to pursue its legal
and equitable remedies upon default shall not constitute a waiver of the City's right to declare a
default and exercise all of its rights under the Note, the Resale Restriction Agreement, and this
Deed of Trust. Nor shall acceptance by the City of any payment provided for in the Note
constitute a waiver of the City's right to require prompt payment of any remaining principal and
interest owed.
23. Borrower's Right to Reinstate. Notwithstanding the City's acceleration of the
sums secured by this Deed of Trust, the Borrower will have the right to have any proceedings
begun by the City to enforce this Deed of Trust discontinued at any time prior to five (5) days
before sale of the Security pursuant to the power of sale contained in this Deed of Trust or at any
time prior to entry of a judgment enforcing this Deed of Trust if: (a) the Borrower pays City all
sums, if any, which would be then due under this Deed of Trust and no acceleration under the
Note has occurred; (b) the Borrower cures all breaches of any other covenants or agreements of
the Borrower contained in the Note, Resale Restriction Agreement or this Deed of Trust; (c) the
Borrower pays all reasonable expenses incurred by City and the Trustee in enforcing the
covenants and agreements of the Borrower contained in the Note, Resale Restriction Agreement
or this Deed of Trust, and in enforcing the City's and the Trustee's remedies, including, but not
limited to, reasonable attorney's fees; and (d) the Borrower takes such action as City may
reasonably require to assure that the lien of this Deed of Trust, City's interest in the Security and
the Borrower's obligation to pay the sums secured by this Deed of Trust shall continue
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unimpaired. Upon such payment and cure by the Borrower, this Deed of Trust and the
obligations secured hereby will remain in full force and effect as if no acceleration had occurred.
24. Reconveyance. Upon payment of all sums secured by this Deed of Trust, the City
will request the Trustee to reconvey the Security and will surrender this Deed of Trust and the
Note to the Trustee. The Trustee will reconvey the Security without warranty and without
charge to the person or persons legally entitled thereto. Such person or persons will pay all costs
of recordation, if any.
25. Substitute Trustee. The City, at the City's option, may from time to time remove
the Trustee and appoint a successor trustee to any trustee appointed hereunder. The successor
trustee will succeed to all the title, power and duties conferred upon the Trustee herein and by
applicable law.
26. Subordination to First Lender Mortgage. Notwithstanding any other provision
hereof, the provisions of this Deed of Trust shall be subordinate to the lien of the First Lender
Deed of Trust and shall not impair the rights of the First Lender, or the First Lender's suc.cessor
or assign, to exercise its remedies under the First Lender Deed of Trust in the event of default
under the First Lender Deed of Trust by the Borrower. Such remedies under the First Lender
Deed of Trust include the right of foreclosure or acceptance of a deed or assignment in lieu of
foreclosure. After such foreclosure or acceptance of a deed or assignment in lieu of foreclosure,
or upon assignment of the First Lender Deed of Trust to the Secretary of the United States
Department of Housing and Urban Development (the "Secretary"), this Deed of Trust shall be
forever tenninated and shall have no further effect as to the Property or any transferee thereafter;
provided, however, if the holder of such First Lender Deed of Trust acquired title to the Property
pursuant to a deed or assignment in lieu of foreclosure, or if the First Lender's Deed of Trust is
assigned to the Secretary, this Deed of Trust shall automatically terminate upon such acquisition
of title or assignment to the Secretary provided that: (i) the City has been given written notice of
default under such First Lender Deed of Trust; and (ii) the City shall not have cured or
commenced to cure the default within such thirty (30) day period and given its firm commitment
to complete the cure in the form and substance acceptable to the First Lender. Borrower agrees
to record any necessary documents to effect such termination, if applicable.
Remainder of Page Left Intentionally Blank
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IN WITNESS WHEREOF, the Borrower has executed this Deed of Trust as of the date
first written above.
Note to Borrower: This Deed of Trust contains provisions prohibiting assumption
;;;~~
Signature
~a<~ ~V'----
Print Name
<?;/4i. <r:"/~02----4
Date
BORROWER:
Signature
Print Name
Date
(Proper Notarial Acknowledgement of Execution by Borrower Must Be Attached)
SEE ATTACHED CERTIFICATE
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EXHIBIT A
LEGAL DESCRIPTION OF PROPERTY
Address: 2671 Leighton Circle, Carlsbad, CA 92009
Assessor Parcel No.: 213-190-05-22
1010\17\2045536.2
For APN/Parcel ID(s): 213-190-05-22
EXHIBIT A
Legal Description
THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF CARLSBAD, COUNTY OF SAN DIEGO,
STATE OF CALIFORNIA AND IS DESCRIBED AS FOLLOWS:
A CONDOMINIUM COMPRISED OF:
PARCEL 1 (COMMON AREA INTEREST):
AN UNDIVIDED FRACTIONAL INTEREST AS TENANT IN COMMON IN AND TO THE COMMON AREA OF PHASE 3
AS DESCRIBED ON THE MULBERRY AT BRESSI RANCH CONDOMINIUM PLAN (THE "CONDOMINIUM PLAN")
RECORDED ON FEBRUARY 11, 2005, AS DOCUMENT NO. 2005-117224, IN THE OFFICE OF THE COUNTY
RECORDER OF SAN DIEGO COUNTY, CALIFORNIA, BEING A PORTION OF LOT 1 OF CARLSBAD TRACT MAP CT
03-03, IN THE CITY OF CARLSBAD, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP
THEREOF NO. 14800 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY ON MAY 21,
2004. THE UNDIVIDED FRACTIONAL INTEREST HEREBY CONVEYED IS THE RECIPROCAL OF THE NUMBER OF
LIVING UNITS SHOWN ON THE CONDOMINIUM PLAN AS BEING WITHIN PHASE 3 OF THE CONDOMINIUM PLAN.
EXCEPTING THEREFROM ALL LIVING UNITS SHOWN ON THE CONDOMINIUM PLAN.
ALSO EXCEPTING THEREFROM, ALL OIL, OIL RIGHTS, MINERALS, MINERAL RIGHTS, NATURAL GAS RIGHTS,
AND OTHER HYDROCARBONS BY WHATSOEVER NAME KNOWN, GEOTHERMAL STEAM AND ALL PRODUCTS
DERIVED FROM ANY OF THE FOREGOING, THAT MAY BE WITHIN OR UNDER THE ABOVE DESCRIBED LAND
("LAND"), TOGETHER WITH THE PERPETUAL RIGHT OF DRILLING, MINING, EXPLORING AND OPERATING
THEREFOR AND STORING IN AND REMOVING SAME FROM SAID LAND OR ANY OTHER LAND, INCLUDING THE
RIGHT TO WHIPSTOCK OR DIRECTIONALLY DRILL AND MINE FROM LANDS OTHER THAN THE LAND, OIL OR
GAS WELLS, TUNNELS AND SHAFTS INTO, THROUGH OR ACROSS THE SUBSURFACE OF THE LAND
HEREINABOVE DESCRIBED, AND TO BOTTOM SUCH WHIPSTOCKED OR DIRECTIONALLY DRILLED WELLS,
TUNNELS AND SHAFTS UNDER AND BENEATH OR BEYOND THE EXTERIOR LIMITS THEREOF, AND TO REDRILL,
RETUNNEL, EQUIP, MAINTAIN, REPAIR, DEEPEN AND OPERATE ANY SUCH WELLS OR MINES WITHOUT,
HOWEVER THE RIGHT TO DRILL, MINE, STORE, EXPLORE OR OPERATE THROUGH THE SURFACE OR THE
UPPER 500 FEET OF THE SUBSURFACE OF THE LAND, AS RESERVED BY BRESSI GARDENLANE, LLC, BY DEED
RECORDED JANUARY 25, 2005, AS DOCUMENT NO. 2005-61440, OFFICIAL RECORDS.
PARCEL 2 (LIVING UNIT):
LIVING UNIT NO. 62, AS SHOWN UPON THE CONDOMINIUM PLAN.
PARCEL 3 (EXCLUSIVE USE AREAS):
THE EXCLUSIVE RIGHT TO USE ANY EXCLUSIVE USE AREA SHOWN ON THE CONDOMINIUM PLAN AS BEING
APPURTENANT TO THE LIVING UNIT DESCRIBED IN PARCEL 2 ABOVE.
PARCEL 4 (EASEMENT OVER ASSOCIATION PROPERLY):
A NON-EXCLUSIVE EASEMENT FOR USE AND ENJOYMENT OF AND ACCESS OVER THE ASSOCIATION
PROPERTY ("ASSOCIATION PROPERTY" IS DEFINED IN THE DECLARATION OF COVENANTS, CONDITIONS AND
RESTRICTIONS AND RESERVATION OF EASEMENTS FOR MULBERRY AT BRESSI RANCH DESCRIBED BELOW),
EXCEPTING ANY EXCLUSIVE USE AREA. THE EASEMENT HEREBY RESERVED, WHICH IS APPURTENANT TO
THE LIVING UNIT DESCRIBED ABOVE, IS FOR ACCESS AND USE OF THE ASSOCIATION PROPERTY, SUBJECT
TO THE PROVISIONS OF THE DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS AND
RESERVATION OF EASEMENTS FOR MULBERRY AT BRESSI RANCH AND THE RULES AND REGULATIONS OF
THE MULBERRY AT BRESSI RANCH HOMEOWNERS ASSOCIATION, A CALIFORNIA NONPROFIT MUTUAL
BENEFIT CORPORATION.
$468,657
PROMISSORY NOTE
Secured by Deed of Trust
Carlsbad, California
August 26, 2024
Notice to Borrower: This Note is not assumable
FOR VALUE RECEIVED, the undersigned Norma Galvan, ("Borrower"), promises to
pay to the City of Carlsbad, a municipal corporation ("City"), at the Housing and Homeless
Services Department, 1200 Carlsbad Village Drive, Carlsbad, California 92008, or such other
place as the City may designate in writing, the principal sum of FOUR HUNDRED SIXTY-
EIGHT THOUSAND SIX HUNDRED FIFTY-SEVEN DOLLARS ($468,657)plus Contingent
Interest calculated pursuant to Section 4 below, plus any amounts due the City as Unauthorized
Rental Proceeds or Excess Sales Proceeds pursuant to the Declaration of Restrictive Covenants
Regarding Restrictions on Transfer of Property, Occupancy Restrictions, Refinancing Restrictions
and Option to Purchase ("Resale Restriction Agreement ") by and between Borrower and City of
even date herewith.
1. Purpose of Loan. Borrower is purchasing the real property more particularly
described in Exhibit A to the Deed of Trust and the improvements thereon located at 2671
Leighton Circle, Carlsbad, CA 92009 in the City of Carlsbad ("Property"). In connection with
the Affordable Housing Resale Program and in fulfillment of its inclusionary obligation pursuant
to an Affordable Housing Agreement ("Affordable Housing Agreement") between the Lennar
Bressi Ranch Venture, LLC, a California limited liability company entered into February 20,
2003. Developer made a subsidy loan ("Homebuyer Loan") to allow for the purchase of a home
by a low-income household located in Carlsbad, California on that certain real property and more
particularly described in Exhibit A ("Property") and then assigned the Homebuyer Loan to the
City. The Homebuyer Loan is in an amount equal to the difference between the fair market value
of the Property and the price affordable to Borrower, who is a lower income household.
Because the home is being made affordable to Borrower as part of the City's affordable
housing program, Borrower is required and has agreed to execute the Resale Restriction
Agreement. Among other things, the Resale Restriction Agreement restricts the price of the
Property upon resale and requires the Borrower to pay any Excess Sales Proceeds (as defined
below) at resale to the City. This Note evidences both: (a) the obligation of Borrower to repay
the Homebuyer Loan; and (b) the obligation of Borrower to pay any Unauthorized Rental
Proceeds (as defined below) and Excess Sales Proceeds to the City pursuant to the Resale
Restriction Agreement.
2. Definitions. The terms set forth in this section shall have the following meanings
in this Note.
1010/17/2045538.2
(a) "Appreciation Amount" shall mean the amount calculated by subtracting
the Original Affordable Purchase Price of the Property from one of the following amounts, as
applicable: (i) in the event of a sale of the Property to the City or City designee pursuant to the
City Option, the Affordable Sales Price; or (ii) in the event of a sale of the Property to an Eligible
Purchaser (as defined in the Resale Restriction Agreement) during the Initial Period (as defined
in the Resale Restriction Agreement), the Affordable Sales Price; or (iii) in the event of any other
sale, the amount received by the Borrower as the sale price of the Property, as certified by the
Borrower; or (iv) in the event of a prepayment of this Note, a Transfer other than sale of the
Property, or in the event of a default, the Fair Market Value of the Property; or (v) in the event a
creditor acquires title to the Property through a deed in lieu of foreclosure, a trustee's deed upon
sale, or otherwise, the amount paid for the Property at a creditor's sale of the Property; or (vi) in
the event of payment at the expiration of the Term the Fair Market Value of the Property. The
provisions of this Section 2(b)(iv) shall be subject to Section 16 of the Resale Restriction
Agreement which requires that when Excess Sales Proceeds are paid to the City that the
Appreciation Amount is calculated by subtracting the Original Affordable Purchase Price from
the Maximum Restricted Resale Price.
(b) "Contingent Interest" shall mean the percentage of the Appreciation
Amount set out in Section 4.
( c) "Excess Sales Proceeds" shall have the meaning set forth in Section 16 of
the Resale Restriction Agreement.
(d) "Fair Market Value" shall be determined by a real estate appraisal made
by an independent residential appraiser designated by the City. If possible, the appraisal shall be
based upon the sales prices of comparable properties sold in the market area during the preceding
three (3)-month period. The cost of the appraisal shall be paid by the Borrower. Nothing in this
subparagraph shall preclude the Borrower and the City from establishing the Fair Market Value
of the Property by mutual agreement in lieu of an appraisal.
( e) "First Mortgage" shall mean the promissory note and deed of trust
evidencing and securing the first mortgage loan for the Property.
(f) "Maximum Restricted Resale Price" shall have the same meaning as set
forth in Section 14 of the Resale Restriction Agreement.
(g) "Original Affordable Purchase Price" shall TWO HUNDRED THIRTY-
SIX THOUSAND THREE HUNDRED FORTY-THREE DOLLARS ($236,343), the affordable
price paid by Borrower to the Seller for the purchase of the Property. The Original Affordable
Purchase Price is the effective price of the Property. The "Full Purchase Price" of the Property
(as defined in the Resale Restriction Agreement) is equal to the Original Affordable Purchase
Price plus the amount of this Promissory Note.
(h) "Property" shall mean the land and improvements thereon encumbered by
the deed of trust executed in connection with this Note.
1010/17/2045538.2
(i) "Resale Restriction Agreement" shall mean the Declaration of Restrictive
Covenants Regarding Restrictions on Transfer of Property, Occupancy Restrictions, Refinancing
Restrictions and Option to Purchase executed by the Borrower and the City in connection with
the Homebuyer Loan.
G) "Transfer" shall mean any sale, assignment or transfer, voluntary or
involuntary, of any interest in the Property, including, but not limited to, a fee simple interest, a
joint tenancy interest, tenancy in common interest, a life estate, a leasehold interest, or an interest
evidenced by a land contract by which possession of the Property is transferred and the Borrower
retains title. Any Transfer without satisfaction of the provisions of this Note is prohibited. A
transfer: (i) to an existing spouse who is also an obligor under the Note; (ii) by a Borrower to a
spouse where the spouse becomes the co-owner of the Property; (iii) between spouses as part of a
marriage dissolution proceeding; (iv) to an existing spouse or child of the Borrower by devise or
inheritance following the death of the Borrower; (v) by the Borrower into an inter vivos
revocable trust in which the Borrower is the trustor; or (vi) by refinance of the First Mortgage
meeting the requirements of Section 11, shall not be considered a Transfer for the purposes of
this Note; provided, however, that the Borrower shall continue to occupy the Property as his or
her principal place of residence ( except where the transfer occurs pursuant to subsection (iii) or
(iv) above, in which event the transferee shall owner-occupy the Home and affirmatively assume
Owner's obligations under this Note and the City Deed of Trust, and the Resale Restriction
Agreement) and the Borrower shall provide written notice of such transfer to the City pursuant to
Section 8 of the Resale Restriction Agreement.
(k) "Unauthorized Rental Proceeds" shall have the meaning set forth in
Section 4 of the Resale Restriction Agreement.
3. Security. This Note is secured by a second deed of trust dated the same date as
this Note (the "Deed of Trust").
4. Contingent Interest. The Borrower shall pay contingent interest equal to Bfly
Percent (50%) of the Appreciation Amount (the "Contingent Interest"). No interest other than
Contingent Interest shall be due hereunder. The Contingent Interest shall be paid to the City at
the time set forth in Section 6 below. Borrower acknowledges that the Contingent Interest
percentage amount is equal to the Homebuyer Loan principal amount as a percentage of the total
purchase price of the Property paid by the Borrower at the time of purchase (which includes the
amount of this Note), multiplied by seventy-five one hundredths (.75). Borrower acknowledges
that this calculation of the percentage of the Appreciation Amount due to the City as Contingent
Interest includes a twenty-five percent (25%) discount to Borrower to account for any capital
improvements Borrower may make to the Property. City has agreed that the Contingent Interest
percent shall not exceed fifty percent (50%).
5. Term. The Term of this Note shall mean the period commencing on the date of
this Note and expiring on the date thirty (30) years thereafter (the "Term").
6. Repayment. The total amount of the principal and any Contingent Interest owed
under this Note (including Unauthorized Rental Proceeds and Excess Sales Proceeds due to the
1010/17/2045538.2
City pursuant to the Resale Restriction Agreement) shall immediately become due and payable:
(a) in the event of a default by the Borrower under this Note, the Resale Restriction Agreement,
the Deed of Trust, or the First Mortgage; (b) on the date Transfer is made whether voluntarily,
involuntarily, or by operation of law and whether by deed, contract of sale, gift, devise, bequest
or otherwise; ( c) in the event Borrower ceases to occupy the Property as his or her principal
place ofresidence; or (d) at the end of the Term of this Note as described above in Section 5.
Failure to declare such amounts due shall not constitute a waiver on the part of the City to
declare them due in the event of a subsequent Transfer.
7. Late Payment Fees. If any payment due hereunder is not paid within five ( 5) days
from the date such becomes due, Borrower shall pay a reasonable late or collection charge equal
to five percent (5%) of the amount so unpaid. The City and Borrower agree that the actual
damages and costs sustained by the City due to the failure to make timely payments would be
extremely difficult to measure and that the charges specified in this paragraph represent a
reasonable estimate by Borrower and the City of a fair average compensation for such damages
and costs. Such charges shall be paid by Borrower without prejudice to the right of the City to
collect any other amounts provided to be paid under this Note, the Resale Restriction Agreement
or the Deed of Trust or, with respect to late payments, to declare a default.
8. Prepayments. The Borrower may prepay all or part of the balance due under this
Note including principal and Contingent Interest. In the event the entire amount of principal due
under this Note is prepaid, all Contingent Interest, calculated as of the date of prepayment, shall
also be due at the time of prepayment. In the event of partial prepayment, the amount of
Contingent Interest due upon prepayment shall be determined at the time of any partial
prepayment based on the Fair Market Value of the Property. Partial prepayments shall be
allocated between payment of Contingent Interest and payment of principal in the same
proportion as the ratio of each to the total amount due (principal and interest) at the time of
prepayment. Following a prepayment, the percentage of Contingent Interest due the City shall
be recalculated to reflect the paydown in principal owed the City. The recalculated Contingent
Interest shall equal the outstanding principal amount of the Note divided by Full Purchase Price.
Notwithstanding any prepayment of amounts due under this Note, the Resale Restriction
Agreement shall continue in full force and effect for the period of time set forth in Section 25 of
the Resale Restriction Agreement.
9. Limitations on Assumption of Note. The Borrower acknowledges that this Note
is given in connection with the purchase of the Property as part of a program of the City to assist
in the purchase of homes by low-income households. Consequently, this Note is only assumable
by Eligible Purchasers (as defined in the Resale Restriction Agreement). This Note is due in full
upon all other Transfers. In the event this Note is assumed by an Eligible Purchaser, the Eligible
Purchaser shall execute a new note, which shall be in an amount equal to the principal and
Contingent Interest owed by Borrower, a new deed of trust and a new resale restriction
agreement with a restarted term in forms approved by the City.
10. Maintenance; Taxes; Insurance. Borrower shall maintain the Property in good
repair and in a neat, clean and orderly condition. Borrower shall promptly pay all property taxes
1010/17/2045538.2
due on the Property prior to any delinquency and shall comply with the insurance requirements
set forth in the Deed of Trust and Resale Restriction Agreement.
11. Refinance of First Mortgage Loan. The outstanding principal and interest on this
Note shall not be due upon prepayment and refinance of the First Mortgage, and the Resale
Restriction Agreement and Deed of Trust shall be subordinated to the refinanced loan, provided
that: (a) such refinancing is approved by the City; (b) the amount refinanced does not exceed the
outstanding principal balance of the First Mortgage at the time ofrefinance plus reasonable costs
of refinance; and ( c) the refinance does not result in higher monthly payments on the First
Mortgage Loan than were due prior to the refinance.
12. Default.
(a) The Borrower shall be in default under this Note if he or she is in default
under the First Mortgage following the expiration of First Mortgage cure periods, or if, after the
notice and cure period provided by the City to the Borrower pursuant to the notice and cure
provisions of the Deed of Trust, the Borrower: (i) fails to pay any money when due under this
Note; (ii) breaches any representation or covenant made in this Note or Resale Restriction
Agreement in any material respect; or (iii) breaches any provision of the Deed of Trust.
(b) Upon the Borrower's breach of any covenant or agreement of the
Borrower in this Note, the Resale Restriction Agreement or the Deed of Trust, including, but not
limited to, the covenants to pay, when due, any sums secured by the Deed of Trust, the City,
prior to acceleration, will send, in the manner set forth in Section 17, notice to the Borrower
specifying: (i) the breach; (ii) if the breach is curable, the action required to cure such breach;
(iii) a date, not less than thirty (30) days from the date the notice is effective, by which such
breach, if curable, is to be cured; and (iv) if the breach is curable, that failure to cure such breach
on or before the date specified in the notice may result in acceleration of the sums secured by the
Deed of Trust and foreclosure by the City. The notice will also inform the Borrower of the
Borrower's right to reinstate after acceleration and the right to bring a court action to assert the
nonexistence of default or any other defense of the Borrower to acceleration and sale.
13. Acceleration. Upon the occurrence of a default under this Note, the Resale
Restriction Agreement, the Deed of Trust, or the First Mortgage, the City shall have the right to
declare the full amount of the principal along with any Contingent Interest under this Note
immediately due and payable. Any failure by the City to pursue its legal and equitable remedies
upon default shall not constitute a waiver of the City's right to declare a default and exercise all
of its rights under this Note, the Resale Restriction Agreement, and the Deed of Trust. Nor shall
acceptance by the City of any payment provided for herein constitute a waiver of the City's right
to require prompt payment of any remaining principal and interest owed.
14. No Offset. The Borrower hereby waives any rights of offset it now has or may
later have against the City, its successors and assigns, and agrees to make the payments called for
in this Note in accordance with the terms of this Note.
1010/17/2045538.2
15. Waiver; Attorney Fees and Costs. The Borrower and any endorsers or guarantors
of this Note, for themselves, their heirs, legal representatives, successors and assigns,
respectively, severally waive diligence, presentment, protest, and demand, and notice of protest,
dishonor and non-payment of this Note, and expressly waive any rights to be released by reason
of any extension of time or change in terms of payment, or change, alteration or release of any
security given for the payments hereof, and expressly waive the right to plead any and all statutes
oflimitations as a defense to any demand on this Note or agreement to pay the same, and jointly
and severally agree to pay all costs of collection when incurred, including reasonable attorney
fees. If an action is instituted on this Note, the Borrower promises to pay, in addition to the costs
and disbursements allowed by law, such sum as a court may adjudge reasonable as attorneys'
fees in such action.
16. No Waiver by the City. No waiver of any breach, default or failure of condition
under the terms of this Note shall be implied from any failure of the City to take action with
respect to such breach, default or failure or from any previous waiver of any similar or unrelated
breach, default or failure.
17. Notices. All notices required in this Note shall be sent by certified mail, return
receipt requested, or express delivery service with a delivery receipt, or personally delivered with
a delivery receipt obtained and shall be deemed to be effective as of the date shown on the
delivery receipt as the date of delivery, the date delivery was refused, or the date the notice was
returned as undeliverable as follows:
To the Borrower:
2671 Leighton Circle
Carlsbad, CA 92009
To the City:
City of Carlsbad
Housing Services Manager
1200 Carlsbad Village Drive
Carlsbad, CA 92008
Attn: Affordable Housing Resale Program
The parties may subsequently change addresses by providing written notice of the change
in address to the other parties in accordance with this section.
18. Joint and Several Obligations. This Note is the joint and several obligations of all
makers, sureties, guarantors and endorsers, and shall be binding upon them and their successors
and assigns.
19. Nonliability for Negligence, Loss, or Damage. Borrower acknowledges,
understands and agrees that the relationship between Borrower and the City is solely that of
1010/17/2045538.2
borrower and lender, and that the City does not undertake or assume any responsibility for or
duty to Borrower to select, review, inspect, supervise, pass judgment on, or inform Borrower of
the quality, adequacy or suitability of the Property or any other matter. The City owes no duty of
care to protect Borrower against negligent, faulty, inadequate or defective building or
construction or any condition of the Property and Borrower agrees that neither Borrower, or
Borrower's heirs, successors or assigns shall ever claim, have or assert any right or action against
the City for any loss, damage or other matter arising out of or resulting from any condition of the
Property and will hold the City harmless from any liability, loss or damage for these things.
20. Termination of Restrictions. Any legal restrictions on conveyance of the Property
(as defined in 24 CFR 203.41(a)(3)) included in this Note shall terminate upon transfer of the
Property by foreclosure, deed in lieu of foreclosure, or assignment to the Secretary of the United
States Department of Housing and Urban Development.
21. Controlling Law. This Note shall be construed in accordance with and be
governed by the laws of the State of California.
22. Assignment by City. The City may assign its right to receive the proceeds under
this Note to any person and upon notice to the Borrower by the City all payments shall be made
to the assignee.
23. Invalid Provisions. If any one or more of the provisions contained in this Note
shall for any reason be held to be invalid, illegal or unenforceable in any respect, then such
provision or provisions shall be deemed severable from the remaining provisions contained in
this Note, and this Note shall be construed as if such invalid, illegal or unenforceable provision
had never been contained in this Note.
24. Entire Agreement. This Note (along with the Resale Restriction Agreement and
Deed of Trust) sets forth the entire understanding and agreement of the City and the Borrower
and any amendment, alteration or interpretation of this Note must be in writing signed by both
the City and the Borrower.
Remainder of page left intentionally blank
1010/17/2045538.2
Recording Requested by:
Fidelity National Title
San Diego Office
Recording requested by and
when recorded mail to:
City of Carlsbad
Housing Services Manager
1200 Carlsbad Village Drive
Carlsbad, CA 92008
No fee for recording pursuant to
Government Code Section 27383
DOC# 2024-0250574
111111111111 lllll 111111111111111111111111111111111111111111111 IIII IIII
Sep 17, 2024 01 :49 PM
OFFICIAL RECORDS
JORDAN Z. MARKS,
SAN DIEGO COUNTY RECORDER FEES: $0.00 (SB2 Atkins: $0.00)
PAGES: 34
DECLARATION OF RESTRICTIVE COVENANTS REGARDING RESTRICTIONS ON
TRANSFER OF PROPERTY, OCCUPANCY RESTRICTIONS, REFINANCING
RESTRICTIONS, AND OPTION TO PURCHASE
(City of Carlsbad Affordable Housing Resale Program)
Owners: Norma Galvan
Address of Property: 2671 Leighton Circle
Carlsbad, CA 92009
Note to Owner: This document contains provisions restricting your ability to sell this
property and obtain junior financing.
This Declaration of Restrictive Covenants Regarding Restrictions on Transfer of Property,
Occupancy Restrictions, Refinancing Restrictions and Option to Purchase ("Resale Restriction
Agreement") is entered into as of this 28thday of August , 2024, by and between the
City of Carlsbad, a municipal corporation (the "City"), and Norma Galvan, a single woman
("Owner").
RECITALS
A. The City has developed a second mortgage program designed to assist qualified
lower income households purchase their homes located within the City of Carlsbad ("Affordable
Housing Resale Program ").
B. In connection with the Affordable Housing Resale Program and in fulfillment of
its inclusionary obligation pursuant to an Affordable Housing Agreement ("Affordable Housing
Agreement") Lennar Bressi Ranch Venture, LLC, a California limited liability company entered
into February 20, 2003. Developer made a subsidy loan ("Homebuyer Loan") to allow for the
purchase of a home by a low-income household located in Carlsbad, California on that certain
real property and more particularly described in Exhibit A ("Property") and then assigned the
Homebuyer Loan to the City.
C. As used herein, the term "Property" includes both the real property and all
improvements now or hereafter erected thereon (including, but not limited to the residential
dwelling unit), and all easements, rights, appurtenances, and all fixtures now or hereafter
attached thereto.
~ Exempt from fee per GC27388.1 due to
·f'\ being recorded in connection with
concurrent transfer that is subject to the
impcs:tion of c.:,cum-Jn1ary t,:.rder ~w,.
D. The "Original Affordable Purchase Price" of the Property is TWO HUNDRED
THIRTY-SIX THOUSAND THREE HUNDRED FORTY-THREE DOLLARS ($236,343). The
Original Affordable Purchase Price is the effective price of the Property paid by the Owner. The
actual price of the Property is equal to the Original Affordable Purchase Price plus the amount of
the Promissory Note ("Full Purchase Price"). Owner is a low-income household.
E. The Homebuyer Loan is FOUR HUNDRED SIXTY-EIGHT THOUSAND SIX
HUNDRED FIFTY-SEVEN DOLLARS ($468,657). The Homebuyer Loan is evidenced by a
promissory note in the amount of the Loan ("City Note"). This Agreement and the City Note
shall be secured by a deed of trust ("City Deed of Trust") subordinate to the lien of First Lender
Deed of Trust.
F. The purpose of this Agreement is to place resale controls on the Property, to
provide the City an option to purchase the Property at a restricted price, and to ensure that the
Owner complies with the Affordable Housing Resale Program requirements.
G. This Agreement and the City Note require repayment of the Homebuyer Loan
plus contingent interest and, in certain instances, payment of excess proceeds of sale. This
Agreement will remain in full effect as an encumbrance on the Property after any
prepayment of the City Note by the Owner.
NOW, THEREFORE, in consideration of the benefits received by the Owner and the
City, the Owner and the City agree, as follows:
1. DEFINITIONS AND EXHIBITS
A The following terms are specifically defined for this Agreement and their
definitions can be found in the Sections indicated below:
(1) "Affordable Sales Price" -Section 14A(l).
(2) "Agreement" -first sentence of the Agreement on page 1.
(3) "City" -first sentence of the Agreement on page 1.
(4) "City Deed of Trust" -Recital F.
(5) "City Designated Purchaser" -Section 12B.
(6) "City Note" -Recital F.
(7) "City Option" -Section 12A.
(8) "City Response Notice" -Section 10.
(9) "Default" -Section 18
(10) "Eligible Purchaser" Section 15B.
(11) "Excess Sales Proceeds" -Section 16.
(12) "Fair Market Value" -Section 14B.
(13) "First Lender" -Recital E.
(14) "First Lender Deed of Trust" or "First Mortgage"-Recital E.
(15) "First Lender Loan" -Recital E.
(16) "Full Purchase Price" -Recital D.
(17) "Full Sales Price" -Section 14A.
(18) "Homebuyer Loan" -Recital B.
(19) "HUD" -Section 30.
(20) "Market Purchaser" -Section 1 0C.
(21) "Maximum Restricted Resale Price" -Section 14.
(22) "Median Income" -Section 14A.
(23) "Official Records" -Recital E.
(24) "Original Affordable Purchase Price" -Recital D.
(25) "Owner" -first sentence of the Agreement on page 1.
(26) "Owner's Notice of Intent to Transfer" -Section 8.
(27) "Property" -Recital B.
(28) "Proposed Purchaser" -Section 15A.
(29) "Transfer" -Section 7.
(30) "Unauthorized Rental Proceeds" -Section 4.
B. The following Exhibits are attached to this Agreement:
(1)
(2)
Exhibit A:
Exhibit B:
Legal Description of Property
Form of Owner Occupancy Certification
(3)
(4)
(5)
(6)
Exhibit C:
Exhibit D:
Exhibit E:
Exhibit F:
Form of Owner's Notice of Intent to Transfer
Form of City Response Notice
Form of Owner Acknowledgement of City Response
Notice
Form of Owner Request for City Subordination to
Refinanced First Lender Loan
2. OWNER CERTIFICATIONS
The Owner certifies that: (i) the financial and other information previously provided in
order to qualify to purchase the Property is true and correct as of the date first written above; (ii)
the Owner is an Eligible Purchaser; (iii) the Owner has disclosed all individuals that shall reside
at the Property; and (iv) the Owner shall occupy the Property as the Owner's principal place of
residence.
3. OCCUPANCY OF PROPERTY
The Owner shall occupy the Property as the Owner's principal place ofresidence within
sixty (60) days after the close of escrow on the Homebuyer Loan. Failure by the Owner to
occupy the Property as the Owner's principal place of residence shall constitute a Default under
this Agreement for which the City may exercise its option to purchase pursuant to Section 21
below. The Owner shall be considered as occupying the Property if the Owner is residing at the
Property for at least ten (10) months out of each calendar year. The Owner shall provide an
annual written certification in the form shown in the attached Exhibit B, to the City that the
Owner is occupying the Property as his or her principal place of residence and listing all
occupants residing at the Property. No later than ten (10) days after receipt of the City's written
request, the Owner shall provide any additional information and documents which the City
requests including but not limited to tax returns and bank statements, which may evidence
whether the Owner is occupying the Property. Failure to provide any additional information or
documentation requested shall constitute a Default under this Agreement.
4. NO LEASING OF PROPERTY
The Owner shall not lease all, or any portion of, the Property to another party. Any lease,
sublease, or any other renting of the Property to a third-party is prohibited and shall be a Default
under this Agreement and the City Deed of Trust. For the avoidance of doubt, the City and the
Owner agree and acknowledge that: (i) the Property (or any portion of the Property) is prohibited
from being used a "short-term vacation rental" (as such term is defined in Chapter 5.60 of the
City of Carlsbad Municipal Code, as may be amended from time to time); (ii) no portion of the
Property may be used for tourist or transient use, or any other short-term rental of the Property;
and (iii) listing the Property on any "hosting platform" (as defined in California Business &
Professions Code 22590, as may be amended from time to time), including, but not limited to
any Internet-based "hosting platform", such as "airbnb.com", or any similar service, is
prohibited. All proceeds derived from any leasing, subleasing, or any other activity prohibited
by this Section are defined as "Unauthorized Rental Proceeds". In addition to all other available
rights and remedies set forth in this Agreement, in the event of violation of this Section, the
Owner shall pay to the City all Unauthorized Rental Proceeds in accordance with Section 19.
5. HOMEBUYER EDUCATION CLASS
The Owner successfully completed a homebuyer education course offered by Fannie
Mae's Home View Course.
6. MAINTENANCE AND INSURANCE PROCEEDS
A. The Owner shall maintain the Property, including landscaping, in good repair and
in a neat, clean and orderly condition and will not commit waste or permit deterioration of the
Property. Failure by the Owner to maintain the Property shall constitute a Default under this
Agreement for which the City may exercise the City Option to purchase the Property pursuant to
Section 21 below.
B. The Owner shall maintain a standard fire and extended coverage home insurance
policy equal to the replacement value of the Property (adjusted every five (5) years by appraisal,
ifrequested by City), naming the City as an additional insured. Additional insurance •
requirements are set forth in Section 6 of the City Deed of Trust.
7. TRANSFER AND SALE RESTRICTIONS
Any Transfer of the Property will be subject to the provisions of this Agreement
including, without limitation, exercise of the City Option pursuant to Section 12 below.
"Transfer" shall mean any sale, assignment or transfer, voluntary or involuntary, of any interest
in the Property, including, but not limited to, a fee simple interest, a joint tenancy interest,
tenancy in common interest, a life estate, a leasehold interest, an interest evidenced by a land
contract by which possession of the Property is transferred and Owner retains title. Any Transfer
without satisfaction of the provisions of this Agreement is prohibited. A Transfer shall not
include a transfer: (i) to an existing spouse who is also an obligor under the City Note; (ii) by the
Owner to a spouse where the spouse becomes the co-owner of the Property; (iii) between
spouses as part of a marriage dissolution proceeding; (iv) to an existing spouse of Owner by
devise or inheritance following the death of Owner; (v) by Owner into an inter vivos revocable
trust in which Owner is the Trustor; or (vi) refinance of the First Mortgage meeting the
requirements of Section 28 of this Agreement; provided, however, that Owner shall provide
written notice of all such transfers to City pursuant to Section 8 below; and Owner shall continue
to occupy the Property as his or her principal place of residence ( except where the transfer occurs
pursuant to subsection (iii) or (iv) above, in which event the transferee shall owner-occupy the
Property and affirmatively assume Owner's obligations under this Agreement, the City Note and
the City Deed of Trust).
8. NOTICE OF INTENDED TRANSFER
A. In the event the Owner intends to transfer (including without limitation all
"Transfers" as defined in Section 7) or vacate the Property, the Owner shall promptly give the
City written notice of such intent (the "Owner's Notice of Intent to Transfer") in the form shown
in the attached Exhibit C. The Owner shall give the City the Owner's Notice of Intent to
Transfer prior to notifying real estate brokers or lenders of Owner's intent to Transfer the
Property and prior to listing of the Property on the Multiple Listing Service. The Owner's Notice
of Intent to Transfer shall be sent to the City in the manner and at the address provided in Section
32 of this Agreement. The Owner's Notice of Intent to Transfer shall include the information
necessary for the City to determine the Maximum Restricted Resale Price of the Property,
including the following information:
( 1) the address of the Property;
(2) the date of purchase of the Property by the Owner;
(3) the Original Affordable Purchase Price of the Property;
(4) the Full Purchase Price of the Property (which is the Original Affordable
Purchase Price plus the original amount of the Home buyer Loan).
(5) a copy of the HUD-1 Settlement Statement or equivalent document from
the close of escrow on the Owner's purchase of the Property;
( 6) the date on which Owner intends to vacate Property;
(7) the name and phone number of the person to contact to schedule
inspection of the Property by the City.
9. OWNER PREPARATION OF PROPERTY FOR SALE
A. The Owner may not wish to contract with a real estate broker to sell the Property
until the Owner has received the City Response Notice pursuant to Section 10 below, as the
services of a broker will not be required if the City exercises the City Option to purchase the
Property pursuant to Section 12 below.
B. Following delivery to the City of the Owner's Notice oflntent to Transfer, the
Owner shall prepare the Property for sale, as follows:
(1) within thirty (30) days of delivery of the Owner's Notice of Intent to
Transfer, the Owner shall obtain and deliver to the City a current written report of inspection of
the Property by a licensed structural pest control operator;
(2) within the sooner of: (a) sixty (60) days from the date of delivery of the
Owner's Notice of Intent to Transfer; or (b) prior to close of escrow on the Transfer, the Owner
shall repair all damage noted in the pest report including damage caused by infestation or
infection by wood-destroying pests;
(3) within thirty (30) days of the date of the Owner's Notice oflntent to
Transfer, the Owner shall allow the City to inspect the Property to determine its physical
condition;
(4) if the Property is vacant, the Owner shall maintain utility connections until
the close of escrow on the Transfer; and
(5) the Owner shall not remove any kitchen appliances prior to vacating the
Property without the City approving such removal; in the event the City approves the removal of
any kitchen appliances the Owner shall replace said appliances with new and comparable
appliances; and
( 6) in the event of purchase of the Property by the City or City Designated
Purchaser, the Owner shall permit a final walk-through of the Property by the City or City
Designated Purchaser, in the final three (3) days prior to close of escrow on the Transfer.
10. CITY RESPONSE TO OWNER'S NOTICE OF INTENDED TRANSFER
City shall respond in writing (the "City Response Notice") to the Owner's Notice of Intent
to Transfer. The form of City Response Notice is attached as Exhibit D. The City Response
Notice shall inform the Owner of the City's election to proceed under one (I) of the following
two (2) alternatives:
A. City Exercise of City Purchase Option. The City Response Notice may notify the
Owner that the City or a City Designated Purchaser elects to exercise the City Option to purchase
the Property. The City Response Notice shall be sent within thirty (30) days of City receipt of
Owner's Notice of Intent to Transfer and shall include the City's calculation of the: (i) Maximum
Restricted Resale Price pursuant to Section 14 below to be paid by the City or a City Designated
Purchaser; and (ii) the transaction fee to be paid by the Owner pursuant to Section 12 below;
B. Owner Sale at a Restricted Sales Price to Eligible Purchaser. Alternatively, the
City Response Notice may notify the Owner that the City or a City Designated Purchaser will not
exercise the City Option to purchase the Property. In this case, the City Response Notice shall
inform the Owner that the Owner may proceed to sell the Property to an Eligible Purchaser at a
price not to exceed the Maximum Restricted Resale Price, as set forth in Section 14 and pursuant
to the procedure set forth in Section 14 below. In this event, the City Response Notice shall
include the following information: (1) the maximum qualifying income for an Eligible
Purchaser (which shall be the same income category as the Owner at the time of the Owner's
purchase); (2) the certifications required of an Eligible Purchaser; (3) the Maximum Restricted
Resale Price the Owner may receive for the Property, calculated by the City pursuant to
Section 14 below; (4) whether Affordable Housing Resale Program assistance from the City may
be available to an Eligible Purchaser; and (5) Owner's repayment obligation as required by
Section 13; and
11. OWNER ACKNOWLEDGEMENT OF CITY RESPONSE NOTICE
No later than seven (7) days following the date of the City Response Notice, the Owner
shall acknowledge in writing to the City, in the form shown in the attached Exhibit E, that he/she
has received the City Response Notice and still intends to Transfer the Property.
12. CITY PURCHASE OPTION
A. The Owner agrees that if the Owner decides to Transfer the Property, the City
shall have the option to purchase the Property for the Maximum Restricted Resale Price
calculated pursuant to Section 14 of this Agreement (the "City Option"). The Owner shall pay
the City a transaction fee up to six percent (6%) of the Maximum Restricted Resale Price if the
City or a City Designated Purchaser exercises the City Option and purchases the Property. The
City Option may be exercised by the City or by a City Designated Purchaser in the City
Response Notice. If the City Response Notice notifies the Owner that the City or a City
Designated Purchaser will exercise the City Option to purchase the Property, the City or the City
Designated Purchaser shall purchase the Property within ninety (90) days of the date of the City
Response Notice and title shall be delivered by the Owner to the City by grant deed free and
clear of any mortgage or other liens, unless approved in writing by the City.
B. The City may assign the City Option to another public agency, a nonprofit
corporation, or an Eligible Purchaser selected by the City (any of which shall be referred to
herein as a "City Designated Purchaser"). If the City assigns the City Option to a City
Designated Purchaser, the City Response Notice shall be executed by the City Designated
Purchaser and shall notify the Owner that a City Designated Purchaser is exercising the City
Option in lieu of the City.
C. In the event of exercise of the City Option and purchase of the Property by the
City or a City Designated Purchaser, the Owner shall permit a final walk-through of the Property
by the City or the City Designated Purchaser in the final three (3) days prior to close of escrow
on the Transfer.
13. REPAYMENT OF CITY NOTE
Upon any Transfer of the Property, the outstanding principal and interest due under the
City Note shall be repaid pursuant to the City Note unless: (i) such principal and interest is
assumed by an Eligible Purchaser in accordance with Section 9 of the City Note; or (ii) the City
exercises the City Option to purchase the Property, in which event the outstanding amount of
principal and Contingent Interest due under the City Note shall be paid to the City in the form of
a credit against the purchase price to be paid by the City to the Owner. Repayment of the City
Note shall not affect Owner's obligation to comply with this Agreement, which shall remain in
full force and effect following any repayment of the City Note.
14. DETERMINATION OF MAXIMUM RESTRICTED RESALE PRICE
The maximum sales price that the Owner shall receive from the resale of the Property to
the City or City Designated Purchaser, or from other sale or Transfer by the Owner when the
Owner sends the Notice oflntent to Transfer (the "Maximum Restricted Resale Price") shall be
the Full Sales Price or the Fair Market Value, whichever is less.
A. Full Sales Price.
(1) The Full Sales Price of the Property means: (a) the Affordable Sales Price;
plus (b) the principal and contingent interest then due on the City Note. The Affordable Sales
Price means the Original Affordable Purchase Price, as set forth in Recital D to this Agreement,
increased by the percentage of increase in the Median Income from the date of the original
purchase of the Property by the Owner to the date of receipt by the City of the Owner's Notice of
Intent to Transfer. "Median Income" shall refer to the median yearly income, adjusted for a
household size of four, in San Diego County, as published by the California Department of
Housing and Community Development ("HCD"), or, in the event such income determination is
no longer published by HCD, or has not been updated for a period of at least eighteen (18)
months, the City may use or develop such other reasonable method as it may choose in order to
determine the median yearly income in San Diego County. As of the date of Owner's purchase
of the Property, the Median Income for a household of four persons is ONE HUNDRED
NINTEEN THOUSAND AND FIVE HUNDRED DOLLARS ($119,500).
(2) The Affordable Sales Price shall include a downward adjustment, where
applicable, in an amount necessary to repair any violations of applicable building, plumbing,
electric, fire or housing codes or any other provisions of the City of Carlsbad Building Code, as
well as any other repairs needed to put the Property into a "sellable condition". Items necessary
to put a Property into sellable condition shall be determined by the City, and may include
cleaning, painting and making needed structural, mechanical, electrical, plumbing and fixed
appliance repairs and other deferred maintenance repairs.
B. Fair Market Value. In certain circumstances it may be necessary to determine the
fair market value of the Property without taking account of the resale restrictions imposed by this
Agreement (the "Fair Market Value"). These circumstances include but are not limited to: (1)
where the parties wish to determine if the Full Sales Price exceeds the Fair Market Value in
order to determine the Maximum Restricted Resale Price pursuant to this section; (2) where the
parties wish to determine if the sales price of the Property to a Market Purchaser is comparable
to the Fair Market Value; and (3) to calculate the amount due under the City Note at the end of
the term of the City Note or upon prepayment. If it is necessary to determine the Fair Market
Value of the Property, it shall be determined by a certified MAI or other qualified real estate
appraiser approved in advance by the City. If possible, the appraisal shall be based upon the
sales prices of comparable properties sold in the market area during the preceding three (3)
month period. The cost of the appraisal shall be paid by the Owner, unless the appraisal is
obtained from a new purchaser. Nothing in this section shall preclude the Owner and the City
from establishing the Fair Market Value of the Property by mutual agreement in lieu of an
appraisal pursuant to this section.
15. SALE BY OWNER IF CITY DOES NOT EXERCISE OPTION TO PURCHASE
In the event the City Response Notice notifies the Owner to proceed to sell the Property
to an Eligible Purchaser at a price not exceeding the Maximum Restricted Resale Price, the
Owner may proceed to sell the Property in compliance with the following requirements:
A. Marketing. The Owner shall use bona fide good faith efforts to sell the Property
to an Eligible Purchaser in compliance with this section, including listing the Property on the
Multiple Listing Service, keeping the Property in an orderly condition, making the Property
available to show to agents and prospective buyers, and providing buyers with Eligible Purchaser
requirements, including income qualifications and the City's form of disclosure statement
summarizing the terms of the buyer's occupancy and resale restriction agreement with option to
purchase. A proposed purchaser ("Proposed Purchaser") who the Owner believes will qualify as
an Eligible Purchaser shall be referred to the City for an eligibility determination. If the
Proposed Purchaser qualifies as an Eligible Purchaser the City will also determine if such
Eligible Purchaser is eligible for City housing-related financial assistance that may be available
at the time of resale.
B. Eligible Purchaser. A Proposed Purchaser shall qualify as an "Eligible Purchaser"
if he or she meets the following requirements, as determined by the City:
(1) Income Eligibility. The combined maximum income for all household
members of the Proposed Purchaser shall not exceed the income level designated by the City in
the City Response Notice.
(2) Intent to Owner Occupy. The Proposed Purchaser shall certify that he or
she will occupy the Property as to his or her principal place of residence throughout his or her
ownership. Co-signers who will not occupy the property are prohibited.
(3) Agreement to Sign Resale Restriction Agreement and to Cooperate with
the City. The Proposed Purchaser shall agree to sign a resale restriction agreement restricting
future resale of the Property and shall agree to cooperate fully with the City in promptly
providing all information requested by the City to assist the City in monitoring the Proposed
Purchaser's compliance with the resale restriction agreement.
C. Maximum Restricted Resale Price. The purchase price for the sale of the Property
by the Owner to the Eligible Purchaser shall not exceed the Maximum Restricted Resale Price
calculated by the City pursuant to Section 14 above, as set forth in the City Response Notice.
The closing costs paid by the Eligible Purchaser shall not exceed reasonable customary buyer's
closing costs in the County of San Diego. Pursuant to Section 13 of this Agreement and Section
9 of the City Note, the Eligible Purchaser may assume the Home buyer Loan and the effective
purchase price that the Eligible Purchaser will pay for the Property is anticipated to be the
Affordable Sales Price.
D. Disclosure and Submittals. The Owner and the Proposed Purchaser shall provide
the following information and documents to the City:
(1) The name, mailing address, telephone number, and email address in
writing of the Proposed Purchaser.
(2) A signed financial statement of the Proposed Purchaser in a form
acceptable to the City and any other supporting documentation requested by the City. The
financial information shall be used by the City to determine the income eligibility of the
Proposed Purchaser.
(3) The proposed sales contract and all other related documents which shall
set forth all the terms of the sale of the Property. Said documents shall include at least the
following terms: (a) the sales price; and (b) the price to be paid by the Proposed Purchaser for the
Owner's personal Property, if any, for the services of the Owner, if any, and any credits,
allowances or other consideration, if any.
(4) A written certification, from the Owner and the Proposed Purchaser in a
form acceptable to the City that the sale shall be closed in accordance with the terms of the sales
contract and other documents submitted to and approved by the City. The certification shall also
provide that the Proposed Purchaser or any other party has not paid and will not pay to the
Owner, and the Owner has not received and will not receive from the Proposed Purchaser or any
other party, money or other consideration, including personal property, in addition to what is set
forth in the sales contract and documents submitted to the City. The written certification shall
also include a provision that in the event a Transfer is made in violation of the terms of this
Agreement or false or misleading statements are made in any documents or certification
submitted to the City, the City shall have the right to foreclose on the Property or file an action at
law or in equity as may be appropriate. In any event, any costs, liabilities or obligations incurred
by the Owner and the Proposed Purchaser for the return of any moneys paid or received in
violation of this Agreement or for any of the Owner's and/or the Proposed Purchaser's costs and
legal expenses, shall be borne by the Owner and/or the Proposed Purchaser and they shall hold
the City harmless and reimburse the City's expenses, legal fees and costs for any action they
reasonably take in good faith in enforcing the terms of this Agreement.
(5) An executed buyer's resale restriction agreement and deed of trust to the
City from the Proposed Purchaser in forms provided by the City. If the Proposed Purchaser is
receiving assistance from the Affordable Housing Resale Program, a promissory note to the City
shall also be required. The recordation of the new deed of trust and buyer's resale restriction
agreement shall be a condition of the City's approval of the proposed sale.
(6) The name of the title company escrow holder for the sale of the Property,
the escrow number, and name, address, and phone number of the escrow officer.
(7) Upon the close of the proposed sale, certified copies of the recorded City
deed of trust and buyer's resale restriction agreement, a copy of the final sales contract,
settlement statement, escrow instructions, and any other documents which the City may
reasonably request.
16. PAYMENT TO CITY OF EXCESS SALES PROCEEDS
If the Owner makes a Transfer in violation of this Agreement at any time, the Owner
shall pay the Excess Sales Proceeds to the City. If the Owner Transfers the Property in violation
of this Agreement, the Appreciation Amount (as such term is defined in the City Note) shall be
calculated using the Maximum Restricted Resale Price of the Property, rather than the actual
sales price. For purposes of this Agreement, "Excess Sales Proceeds" shall mean ninety-four
percent (94%) of the amount by which the gross sales proceeds received by the Owner from the
new purchaser exceed the Maximum Restricted Resale Price for the Property. This amount shall
be a debt of the Owner to the City, further evidenced by the City Note, and secured by the City
Deed of Trust. The Owner acknowledges that the City shall have no obligation to cause the
release and termination of this Agreement, or the reconveyance of the City Deed of Trust, until
the Excess Sales Proceeds are paid to the City. The City shall utilize the Excess Sales Proceeds
for City affordable housing programs. The Owner and the City acknowledge that the formula for
calculation of the amount of Excess Sales Proceeds due from the Owner to the City is intended to
cause the Owner to receive the same net sales proceeds (following payment by Owner of a
standard broker's commission) from sale of the Property at an unrestricted price to a market
purchaser (in violation of this Agreement) as the Owner would receive from sale of the Property
to the City, City Designated Purchaser or to an Eligible Purchaser at the Maximum Restricted
Resale Price.
17. DEFAULTS
A. A Default by the Owner is any failure to comply with the requirements of this
Agreement, the City Note or the City Deed of Trust, whether by commission or omission which
includes, but is not limited to the following:
(I) The City determines that the Owner has made a misrepresentation to
obtain the benefits of purchase of the Property or in connection with its obligations under this
Agreement.
(2) The Owner fails to owner occupy the Property, as required pursuant to
Section 3 above, and such failure continues following written notice by the City and sixty (60)
days opportunity to cure following the date of such notice.
(3) The Owner rents all or a portion of the Property in violation of Section 4
above, and such failure continues following written notice by the City and sixty ( 60) days
opportunity to cure.
(4) The Owner fails to provide information or documents to the City that the
City deems necessary to determine Owner's compliance with the requirements of this
Agreement.
(5) The Owner makes a Transfer in violation of this Agreement.
( 6) A notice of default is issued under First Lender Loan.
(7) A lien is recorded in the Official Records against the Property other than
the First Mortgage.
(8) Owner records a deed of trust against the Property in the Official Records,
or otherwise places a mortgage on the Property in violation of Section 28 below.
(9) Owner declares bankruptcy or makes an assignment of assets for the
benefit of creditors.
B. Upon a declaration of Default by the City under this Agreement, the City may
exercise any remedies at law or in equity, including without limitation, any or all of the
following:
(1) Declare all Excess Sales Proceeds immediately due and payable without
further demand, accelerate payments due under the City Note and invoke the power of sale under
the City Deed of Trust;
(2) Apply to a court of competent jurisdiction for such relief at law or in
equity as may be appropriate, including, but not limited to specific performance.
(3) Declare a Default under the City Note and the City Deed of Trust and
pursue all City remedies under the City Note and the City Deed of Trust; and
(4) Exercise the City Option upon Default as described in Section 21, below.
Owner acknowledges that any breach in Owner's performance of Owner's obligations under this
Agreement shall cause irreparable harm to the City. Therefore, Owner agrees that the City is
entitled to equitable relief in the form of specific performance upon its exercise of the City
Option set forth in Section 21, below, and that an award of damages may not be adequate to
compensate the City for Owner's failure to perform according to the terms of this Agreement.
The City, in its sole and absolute discretion, may elect the appropriate remedy for Owner's
default under this Agreement.
18. NOTICEANDCURE
Upon a violation of any of the provisions of this Agreement, the City Note or the City
Deed of Trust, the City shall give written notice to the Owner specifying the nature of the
violation and demanding a cure. If the violation is not corrected to the satisfaction of the City
within a reasonable period of time, not longer than thirty (30) days from the date the notice is
mailed, or within such further time as the City determines is necessary to correct the violation, or
if the Owner is in default under the First Mortgage, the City may declare a Default under this
Agreement. If the violation is failure to occupy the Property, as set forth in Section 3, or any
rental of the Property or any other act prohibited by Section 4, then Owner shall be given sixty
(60) days from the date the notice is mailed to correct that violation, and, to the extent applicable,
remit all Unauthorized Rental Proceeds to the City before the City may declare a Default.
The City shall notify First Lender at the address provided by the First Lender to the City
in the manner set forth in Section 33 of this Agreement, if the City has declared a Default under
this Agreement or under the City Note or City Deed of Trust.
19. NOTICE TO CITY OF DEFAULT
A request for notice of default and any notice of sale under any deed of trust or mortgage
with power of sale encumbering the Property shall be recorded by the 'City in the Official
Records for the benefit of the City. The City may declare a default under this Agreement upon
receipt of any notice given to the City pursuant to Civil Code Section 2924b and may exercise its
rights as provided in Sections 18 and 21.
In the event of default and foreclosure under the First Lender Loan or any other mortgage
loan on the Property, the City shall have the same right as the Owner to cure defaults and redeem
the Property prior to the foreclosure sale. Nothing herein shall be construed as creating any
obligation of the City to cure any such default, nor shall this right to cure and redeem operate to
extend any time limitations in the default provisions of the underlying deed of trust or mortgage.
If the City failed to file the request for notice of default, the City's right to purchase the
Property shall commence from the date a notice of default is given by the City to the Owner.
20. PURCHASE OPTION UPON DEFAULT
A. Purchase Option. Notwithstanding, and in addition to, the remedies provided the
City in Section 18, and the City Purchase Option provided in Section 12, the Owner hereby
grants to the City or the City Designated Purchaser the option to purchase the Property effective
upon the declaration of a Default by the City pursuant to Section 18 and Section 19 above, and
subject to notice and cure rights set forth in Section 19.
B. Exercise of Option. The option to purchase may be exercised upon a Default
under this Agreement or upon default under any promissory note, deed of trust or any other lien,
including a judgment lien, recorded against the Property. The City shall have thirty (30) days
after a Default is declared to notify the Owner and the First Lender of its decision to exercise its
option to purchase. Not later than ninety (90) days after the notice is given by the City to the
Owner of the City's intent to exercise its option, the City shall purchase the Property for the
Maximum Restricted Resale Price set forth in Section 14. The City may assign its rights to
purchase the Property under this section to a City Designated Purchaser.
21. NONLIABILITY OF THE CITY
A. No Obligation to Exercise Option. The City shall have no obligation to exercise
any option granted it under this Agreement. In no event shall the City become in any way liable
or obligated to the Owner or any successor-in-interest to the Owner by reason of its option to
purchase under Sections 12 and 21 nor shall the City be in any way obligated or liable to the
Owner or any successor-in-interest to the Owner for any failure to exercise its option to
purchase.
B. Nonliability for Negligence, Loss, or Damage. Owner acknowledges,
understands and agrees that the relationship between Owner and the City is solely that of an
owner and an administrator of a City inclusionary housing program, and that the City does not
undertake or assume any responsibility for or duty to Owner to select, review, inspect, supervise,
pass judgment on, or inform Owner of the quality, adequacy or suitability of the Property or any
other matter. The City owes no duty of care to protect Owner against negligent, faulty,
inadequate or defective building or construction or any condition of the Property and Owner
agrees that neither Owner, or Owner's heirs, successors or assigns shall ever claim, have or assert
any right or action against the City for any loss, damage or other matter arising out of or
resulting from any condition of the Property and will hold the City harmless from any liability,
loss or damage as set forth in Section 22( c ). Any review by the City of any documents submitted
by the Owner to the City pursuant to this Agreement, including, but not limited to any purchase
and sale agreement for the Property, is solely to confirm compliance with the requirements of
this Agreement and shall not be deemed to be a representation of any kind of the validity or legal
enforceability of such document(s).
C. Indemnity. Owner agrees to defend (with counsel reasonably selected by the
City), indemnify, and hold the City harmless from all losses, damages, liabilities, claims, actions,
judgments, and costs, including expenses, and reasonable attorneys' fees that the City may incur,
as a direct or indirect consequence of: (1) Owner's default, performance, or failure to perform
any obligations as and when required by this Agreement, the City Note, or the City Deed of
Trust; or (2) the failure at any time of any of Owner's representations to the City to be true and
correct. This provision shall survive the termination or expiration of this Agreement, and the
reconveyance of the City Deed of Trust.
22. RESTRICTIONS ON FORECLOSURE PROCEEDS
If a creditor acquires title to the Property through a deed in lieu of foreclosure, a trustee's
deed upon sale, or otherwise, the Owner shall not be entitled to the proceeds of sale to the extent
that such proceeds otherwise payable to the Owner when added to the proceeds paid or credited
to the creditor exceed the Maximum Restricted Resale Price. The Owner shall instruct the holder
of such excess proceeds (in addition to other amounts due to the City pursuant to the City Note
and this Agreement) to pay such proceeds to the City in consideration of the benefits received by
the Owner through purchase of the Property under this Agreement.
23. RESTRICTION ON INSURANCE PROCEEDS
If the Property is damaged or destroyed and the Owner elects not to rebuild or repair the
Property, the Owner shall pay the City the portion of any insurance proceeds received by the
Owner for such destruction or damage which is in excess of the Maximum Restricted Resale
Price calculated pursuant to Section 14 above.
24. TERM OF AGREEMENT
All the provisions of this Agreement, including the benefits and burdens, run with the
land and the Property and this Agreement shall bind, and the benefit hereof shall inure to, the
Owner, his or her heirs, legal representatives, executors, successors in interest and assigns, and to
the City and its successors until the earlier of: (i) thirty (30) years from the date ofrecordation of
this Agreement in the Official Records; or (ii) the date of Transfer of the Property to the City or
another purchaser in compliance with this Agreement (including execution by the purchaser of a
new resale restriction agreement for the benefit of the City).
25. SUPERIORITY OF AGREEMENT
The Owner covenants that he or she has not, and will not, execute any other agreement
with provisions contradictory to or in opposition to the provisions of this Agreement hereof, and
that, in any event, this Agreement is controlling as to the rights and obligations between and
among the Owner, the City and their respective successors.
26. SUBORDINATION
Notwithstanding any other provision hereof, the provisions of this Agreement shall be
subordinate to the lien of the First Lender Loan and shall not impair the rights of the First
Lender, or the First Lender's successor or assign, to exercise its remedies under the First Lender
Deed of Trust in the event of default under the First Lender Deed of Trust by the Owner. Such
remedies under the First Lender Deed of Trust include the right of foreclosure or acceptance of a
deed or assignment in lieu of foreclosure. After such foreclosure or acceptance of a deed or
assignment in lieu of foreclosure, this Agreement shall be forever terminated and shall have no
further effect as to the Property or any transferee thereafter; provided, however, if the holder of
such First Lender Deed of Trust acquired title to the Property pursuant to a deed or assignment in
lieu of foreclosure, this Agreement shall automatically terminate upon such acquisition of title,
provided that: (i) the City has been given written notice of default under such First Lender Deed
of Trust; and (ii) the City shall not have cured or commenced to cure the default within such
thirty (30) day period and given its firm commitment to complete the cure in the form and
substance acceptable to the First Lender. Owner agrees to record any necessary documents to
effect such termination, if applicable.
27. REFINANCE OF FIRST LENDER LOAN
The outstanding principal on the City Note shall not be due upon prepayment and
refinancing of the First Lender Loan, and this Agreement and the City Deed of Trust shall be
subordinated to the refinanced First Lender Loan, provided that: (i) such refinancing is approved
by the City; (ii) the amount refinanced does not exceed the outstanding principal balance of the
First Mortgage at the time ofrefinance plus reasonable costs ofrefinance; and (iii) the refinance
does not result in higher monthly payments on the First Lender Loan than were due prior to the
refinance. Mortgage loans or equity lines of credit junior in lien priority to the City Deed of
Trust are not permitted. Owner acknowledges that such prohibition on junior liens was
granted in consideration for the receipt of the Home buyer Loan on favorable terms that have
assisted the Owner acquire the Property for Original Affordable Purchase Price, and that without
such financial assistance from the City, the Owner would not be able to pay the Original
Affordable Purchase Price, or otherwise acquire the Property. The City and the Owner agree that
the requirements of this section are necessary to ensure the continued affordability of the
Property to Owner and to minimize the risk of loss of the Property by Owner through default and
foreclosure of mortgage loans. Owner further acknowledges that violation of the provisions of
this section shall constitute a Default under this Agreement. A form for use by the Owner in
requesting City subordination to a refinanced First Lender Loan is attached hereto as Exhibit F.
28. NONDISCRIMINATION
The Owner covenants by and for itself and its successors and assigns that there shall be
no discrimination against or segregation of a person or of a group of persons on account of race,
color, religion, creed, age, disability, sex, sexual orientation, marital status, ancestry or national
origin in the sale, transfer, use, occupancy, tenure or enjoyment of the Property, nor shall the
Owner or any person claiming under or through the Owner establish or permit any such practice
or practices of discrimination or segregation with reference to the use, occupancy, or transfer of
the Property. The foregoing covenant shall run with the land.
29. RIGHTS OF BENEFICIARIES UNDER DEEDS OF TRUSTS
This Agreement shall not diminish or affect the rights of the City under the City Note and
the City Deed of Trust.
Notwithstanding any other provision in this Agreement to the contrary, this Agreement
shall not diminish or affect the rights of the California Housing Finance Agency ("CalHF A"), the
United States Department of Housing and Urban Development ("HUD"), the Federal National
Mortgage Association ("FNMA"), or the Veterans Administration ("VA") under the First Lender
Deed of Trust or any subsequent First Lender deeds of trust hereafter recorded against the
Property in compliance with Section 28 above.
30. HUD FORBEARANCE RELIEF
Notwithstanding other provisions of this Agreement, the Option shall not be exercised by
the City when a deed of trust insured by HUD is secured by the Property, and: (i) the Owner is
undergoing consideration by HUD for assignment forbearance relief; or (ii) the Owner is
undergoing consideration for relief under HUD's Temporary Mortgage Assistance Payment
(TMAP) program.
31. INVALID PROVISIONS
If any one or more of the provisions contained in this Agreement shall for any reason be
held to be invalid, illegal or unenforceable in any respect, then such provision or provisions shall
be deemed severable from the remaining provisions contained in this Agreement, and this
Agreement shall be construed as if such invalid, illegal or unenforceable provision had never
been contained herein.
32. NOTICES
All notices required herein shall be sent by certified mail, return receipt requested or
express delivery service with a delivery receipt or personally delivered with delivery receipt
obtained and shall be deemed to be effective as of the date shown on the delivery receipt as the
date of delivery, or the date delivery was refused as indicated on the return receipt, or the date
Notice was returned as undeliverable as follows:
To Owner:
2671 Leighton Circle
Carlsbad, CA 92009
To the City:
City of Carlsbad
Housing Services Manager
1200 Carlsbad Village Drive
Carlsbad, CA 92008
Attn: Affordable Housing Resale Program
The parties may subsequently change addresses by providing written notice of the change in
address to the other parties in accordance with this section.
33. INTERPRETATION OF AGREEMENT
The terms of this Agreement shall be interpreted so as to avoid speculation on the
Property and to insure to the extent possible that the mortgage payments remain affordable to
lower-income households. Owner acknowledges that, pursuant to this Agreement, in addition to
other rights of the City set forth herein, the Owner has granted the City multiple options to
purchase the Property (as more particularly set forth in Section 12 and Section 21), and that each
option to purchase is given in consideration of the economic benefits received by the Owner
resulting from ownership of the Property made possible by the financial assistance provided by
the City to the Owner for the purchase of the Property. This Agreement shall not be construed as
if it had been prepared by one of the parties, but rather as if both parties had prepared it. The
parties have read and reviewed this Agreement and agree that any rule of construction to the
effect that ambiguities are to be resolved against the drafting party (including but not limited to
Civil Code Section 1654 as may be amended from time to time) shall not apply to the
interpretation of this Agreement. In the event of any conflict between the terms of this
Agreement, and the terms of the disclosure statement executed by the City and the Owner in
conjunction with this Agreement, the terms of this Agreement shall prevail.
34. CONTROLLING LAW; VENUE
The terms of this Agreement shall be interpreted under the laws of the State of California.
In the event any legal action is commenced to interpret or to enforce the terms of this Agreement
or to collect damages as a result of any breach thereof, the venue for such action shall be the
Superior Court of the County of San Diego.
35. ATTORNEYS' FEES
In the event any action or proceeding in court or other dispute resolution mechanism
permitted under this Agreement is commenced by either party to interpret or enforce the terms of
this Agreement, the prevailing party therein shall be entitled to recover from the non-prevailing
party all of the prevailing party's reasonable costs and expenses in connection therewith,
including on any appeal and including expert witness fees, document copying expenses, exhibit
preparation costs, carrier expenses and postage and communication expenses, and reasonable
attorneys' fees and costs for the services rendered to the prevailing party in such action or
proceeding (which shall include the reasonable costs for services of the City's in-house counsel).
36. TIME IS OF THE ESSENCE
In all matters under this Agreement, the parties agree that time is of the essence.
37. TITLE OF PARTS AND SECTIONS
Any titles of the articles, sections or subsections of this Agreement are inserted for
convenience of reference only and shall be disregarded in construing or interpreting any part of
its provision.
38. EXHIBITS
Any exhibits referred to in this Agreement are incorporated in this Agreement by such
reference.
39. INTERPRETATION
Where the context requires herein, the singular shall be construed as the plural, and
neuter pronouns shall be construed as masculine and feminine pronouns, and vice versa.
References in this Agreement to days shall be to calendar days. If the last day of any period to
give or reply to a notice, meet a deadline or undertake any other action occurs on a day that is not
a day of the week on which the City of Carlsbad is open to the public for carrying on
substantially all business functions (a "Business Day"), then the last day for giving or replying to
such notice, meeting such deadline or undertaking any such other action shall be the next
succeeding Business Day. In no event shall a Saturday or Sunday be considered a Business Day.
The use in this Agreement of the words "including", "such as" or words of similar import when
used with reference to any general term, statement or matter shall not be construed to limit such
statement, term or matter to the specific statements, terms or matters, unless language of
limitation, such as "and limited to" or words of similar import are used with reference thereto.
40. NON-WAIVER OF BREACH
Neither the failure of the City to insist upon strict performance of any of the covenants
and agreements of this Agreement, nor the failure by the City to exercise any rights or remedies
granted to the City under the terms of this Agreement shall be deemed a waiver or
relinquishment of: (i) any covenant contained in this Agreement, or of any of the rights or
remedies of the City under this Agreement; or (ii) the right in the future of the City to insist upon
and to enforce by any appropriate legal remedy a strict compliance with all of the covenants and
conditions of this Agreement.
41. OWNER'S ACKNOWLEDGEMENT OF RESALE RESTRICTION
Owner hereby acknowledges and agrees that:
A Owner hereby subjects the Property to the restrictions set forth above, and hereby
limits the price for which Owner may sell the Property and the persons to whom Owner may sell
the Property as set forth above. The resale price limitation and other provisions contained in this
Agreement restrict the full benefits of owning the Property. Owner may not enjoy the same
economic or other benefits from owning the Property that Owner would enjoy if this Agreement
did not exist.
B. Owner acknowledges that the City provided the Homebuyer Loan to the Owner
because of the Owner's income eligibility, and the Owner further acknowledges that this
Agreement requires that the Property be made available to Eligible Purchasers at an affordable
pnce.
C. Owner understands all of the provisions of this Agreement. In recognition of the
acknowledgments and agreements stated in this Section, Owner accepts and agrees to the
provisions of this Agreement with the understanding that this Agreement will remain in full force
and effect as to the Property following any Transfer of the Property throughout the Term.
D. OWNER UNDERSTANDS THAT THE DETERMINATION OF THE
MAXIMUM RESTRICTED RESALE PRICE OF THE PROPERTY TO AN ELIGIBLE
PURCHASER CAN BE MADE ONLY AT THE TIME OF THE PROPOSED TRANSFER,
TAKING INTO CONSIDERATION INCREASES IN MEDIAN INCOME AND OTHER
FACTORS THAT CANNOT BE ACCURATELY PREDICTED, AND THAT THE SALES
PRICE PERMITTED HEREUNDER MAY NOT INCREASE OR DECREASE IN THE SAME
MANNER AS OTH:ER SIMILAR REAL PROPERTY WHICH IS NOT ENCUMBERED BY
THIS AGREEMENT OR SUBJECT TO THE CITY'S AFFORDABLE HOUSING RESALE
PROGRAM. OWNER FURTHER ACKNOWLEDGES THAT AT ALL TIMES IN SETTING
THE SALES PRICE OF THE HOME, THE PRIMARY OBJECTIVE OF THE CITY AND
THIS AGREEMENT IS TO IMPLEMENT THE CITY'S AFFORDABLE HOUSING RESALE
PROGRAM IN ORDER TO PROVIDE HOUSING TO ELIGIBLE PURCHASERS AT AN
AFFORDABLE HOUSING COST. THE MAXIMUM RESTRICTED RESALE PRICE
COULD BE LESS THAN OTHER SIMILAR PROPERTIES THAT HAVE NO
RESTRICTIONS. NOTWITHSTANDING SUCH LIMITATIONS AND RESTRICTIONS
IMPOSED ON THE PROPERTY PURSUANT TO THIS AGREEMENT, OWNER DESIRES
TO OBTAIN THE HOMEBUYER LOAN AND HA VE THE PROPERTY SUBJECT TO THIS
AGREEMENT.
,-j.(o, I --(Initials of Owners)
42. COUNTERPARTS
This Agreement may be executed in multiple originals, each of which is deemed to be an
original, and may be signed in counterparts, which shall constitute one and the same agreement.
Remainder of Page Left Intentionally Blank
ll GOVERNMENT·CODE 27361.7 II
I CERTIFY UNDER PENALTY OF PERJURY THAT THE· NOTARY ·SEAL ON THE
DOCUMENT TO WHIC.H THIS.STATEMENT IS ATTACHED READS AS FOLLOWS:
Name of the N .• otary:_S_he_l_b.:...y_M_._N_e_ls_o_n _______________ _
Commission-Number: 237:3071 Date Commission Expires: B-31 -2025
County Where Bond is Filed:. __ S_a_n_D_ie-=g;....o _____________ _
NNA1 • Manufacturer or Vendor Number: _________________ _
(Located on both sides of the notary seal border)
Signature:---il',~~u~~Mh_~__.,_-------
Firm Name (if applicable) •·
Place of Execution: San Diego Date: 9-16-2024 ·------------
1 Rec. Form IIR IO (Rev. 7/961
EXHIBIT A
LEGAL DESCRIPTION OF PROPERTY
ADDRESS: 2671 Leighton Circle, Carlsbad, CA 92009
ASSESSOR PARCEL NO.: 213-190-05-22
A-1
For APN/Parcel ID(s): 213-190-05-22
EXHIBIT A
Legal Description
THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF CARLSBAD, COUNTY OF SAN DIEGO,
STATE OF CALIFORNIA AND IS DESCRIBED AS FOLLOWS:
A CONDOMINIUM COMPRISED OF:
PARCEL 1 (COMMON AREA INTEREST):
AN UNDIVIDED FRACTIONAL INTEREST AS TENANT IN COMMON IN AND TO THE COMMON AREA OF PHASE 3
AS DESCRIBED ON THE MULBERRY AT BRESSI RANCH CONDOMINIUM PLAN (THE "CONDOMINIUM PLAN")
RECORDED ON FEBRUARY 11, 2005, AS DOCUMENT NO. 2005-117224, IN THE OFFICE OF THE COUNTY
RECORDER OF SAN DIEGO COUNTY, CALIFORNIA, BEING A PORTION OF LOT 1 OF CARLSBAD TRACT MAP CT
03-03, IN THE CITY OF CARLSBAD, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP
THEREOF NO. 14800 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY ON MAY 21,
2004. THE UNDIVIDED FRACTIONAL INTEREST HEREBY CONVEYED IS THE RECIPROCAL OF THE NUMBER OF
LIVING UNITS SHOWN ON THE CONDOMINIUM PLAN AS BEING WITHIN PHASE 3 OF THE CONDOMINIUM PLAN.
EXCEPTING THEREFROM ALL LIVING UNITS SHOWN ON THE CONDOMINIUM PLAN.
ALSO EXCEPTING THEREFROM, ALL OIL, OIL RIGHTS, MINERALS, MINERAL RIGHTS, NATURAL GAS RIGHTS,
AND OTHER HYDROCARBONS BY WHATSOEVER NAME KNOWN, GEOTHERMAL STEAM AND ALL PRODUCTS
DERIVED FROM ANY OF THE FOREGOING, THAT MAY BE WITHIN OR UNDER THE ABOVE DESCRIBED LAND
("LAND"), TOGETHER WITH THE PERPETUAL RIGHT OF DRILLING, MINING, EXPLORING AND OPERATING
THEREFOR AND STORING IN AND REMOVING SAME FROM SAID LAND OR ANY OTHER LAND, INCLUDING THE
RIGHT TO WHIPSTOCK OR DIRECTIONALLY DRILL AND MINE FROM LANDS OTHER THAN THE LAND, OIL OR
GAS WELLS, TUNNELS AND SHAFTS INTO, THROUGH OR ACROSS THE SUBSURFACE OF THE LAND
HEREINABOVE DESCRIBED, AND TO BOTTOM SUCH WHIPSTOCKED OR DIRECTIONALLY DRILLED WELLS,
TUNNELS AND SHAFTS UNDER AND BENEATH OR BEYOND THE EXTERIOR LIMITS THEREOF, AND TO REDRILL,
RETUNNEL, EQUIP, MAINTAIN, REPAIR, DEEPEN AND OPERATE ANY SUCH WELLS OR MINES WITHOUT,
HOWEVER THE RIGHT TO DRILL, MINE, STORE, EXPLORE OR OPERATE THROUGH THE SURFACE OR THE
UPPER 500 FEET OF THE SUBSURFACE OF THE LAND, AS RESERVED BY BRESSI GARDENLANE, LLC, BY DEED
RECORDED JANUARY 25, 2005, AS DOCUMENT NO. 2005-61440, OFFICIAL RECORDS.
PARCEL 2 (LIVING UNIT):
LIVING UNIT NO. 62, AS SHOWN UPON THE CONDOMINIUM PLAN.
PARCEL 3 (EXCLUSIVE USE AREAS):
THE EXCLUSIVE RIGHT TO USE ANY EXCLUSIVE USE AREA SHOWN ON THE CONDOMINIUM PLAN AS BEING
APPURTENANT TO THE LIVING UNIT DESCRIBED IN PARCEL 2 ABOVE.
PARCEL 4 (EASEMENT OVER ASSOCIATION PROPERLY):
A NON-EXCLUSIVE EASEMENT FOR USE AND ENJOYMENT OF AND ACCESS OVER THE ASSOCIATION
PROPERTY ("ASSOCIATION PROPERTY" IS DEFINED IN THE DECLARATION OF COVENANTS, CONDITIONS AND
RESTRICTIONS AND RESERVATION OF EASEMENTS FOR MULBERRY AT BRESSI RANCH DESCRIBED BELOW),
EXCEPTING ANY EXCLUSIVE USE AREA. THE EASEMENT HEREBY RESERVED, WHICH IS APPURTENANT TO
THE LIVING UNIT DESCRIBED ABOVE, IS FOR ACCESS AND USE OF THE ASSOCIATION PROPERTY, SUBJECT
TO THE PROVISIONS OF THE DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS AND
RESERVATION OF EASEMENTS FOR MULBERRY AT BRESSI RANCH AND THE RULES AND REGULATIONS OF
THE MULBERRY AT BRESSI RANCH HOMEOWNERS ASSOCIATION, A CALIFORNIA NONPROFIT MUTUAL
BENEFIT CORPORATION.
EXHIBITB
FORM OF OWNER OCCUPANCY CERTIFICATION
To: City of Carlsbad ("City")
From: __________ [name of owner(s)] ("Owner(s)")
Address of Property: ____________ ("Property")
Date:
By signature below, I ______________ [insert name or names of
Owner(s)] hereby certify to the City under penalty of perjury that I/we occupy the home located
at _________________ [insert address] ("Property") as my/our
principal place of residence and that I/we have occupied the Property for _____ (_)
[insert number] months of the calendar year ______ [insert previous calendar year].
Attached to this letter is a copy of ____ [insert utility bill or driver's license] showing
my place of residence?
All of the occupants of the Property are listed as follows:
This Owner Occupancy Certification is signed on ________ , 20_, under penalty of
perJury.
By:
Owner signature
Date:
By:
Owner signature
Date:
Due Date: _____ of each calendar year.
Attach copy of utility bill or driver's license showing address of Property.
B-1
EXHIBIT C
FORM OF OWNER'S NOTICE OF INTENT TO TRANSFER
To: City of Carlsbad ("City")
From: __________ [name of owner(s)] ("Owner(s)")
Address of Property: ____________ ("Property")
Date:
Please be notified pursuant to Section 8 of the Resale Restriction Agreement and Option to
Purchase between Owner and City dated ______ that the Owner intends to transfer the
Property listed above.
A. The following information is provided to the City pursuant to Section 8 of the Resale
Agreement:
1. Address of Property: ---------------------
2. Date Owner purchased Property: ________________ _
3. Original Affordable Purchase Price: _______________ _
4. Original amount of Homebuyer Loan: _______________ _
5. Full Purchase Price: ---------------------
6. Date Owner intends to vacate Property: ---------------
7. Name and phone number of person for City to contact to schedule inspection:
and -----------------------(name) (phone number)
B. As required by Section 8 of the Resale Restriction Agreement, the following the HUD-1
Settlement Statement from Owner's purchase of the property is attached.
C. I have not listed the Property for sale with a multiple listing service, or contacted a
real estate broker or financial institution. I agree to prepare the Property for sale by:
1. obtaining a pest control report within thirty (30) days of the date of this notice;
C-1
2. repairing all damage noted in the pest report within the sooner of: (i) sixty ( 60)
days from the date of this notice; or (ii) two (2) weeks prior to close of escrow or the transfer of
the Property;
3. allowing the City or its designee to inspect the Property within thirty (30) days of
this notice;
4. maintaining utility connections until the Property is transferred;
5. not removing any kitchen appliances prior to vacating the Property without the
City approving such removal; and
6. permitting a walk through by the City prior to close of escrow or the transfer.
This Owner's Notice oflntent to Transfer is certified by Owner to be true and correct and
is signed on the date(s) below under penalty of perjury.
By:
Owner signature
Date:
By:
Owner signature
Date:
C-1
EXHIBITD
FORM OF CITY RESPONSE NOTICE
To: __________ ("Owner(s)")
From: City of Carlsbad ("City")
Address of Property: ____________ ("Property")
Date:
Thank you for delivering the Notice oflntent to Transfer. This letter is the City Response Notice
described in Section 10 of the Resale Restriction Agreement that was recorded against title to
your home. The City:
1. __ City will check this Sentence #1 and complete other information listed in #1 if the
City intends to exercise its option to purchase the Property or assign its option to the Property to
a Designated Purchaser at any point during the entire Term of Resale Restriction Agreement
A. Affordable Sales Price: $ --------
B. Amount owed on Homebuyer Loan: $ ________ _
C. Full Sales Price (add numbers in l(A) and l(B)): $ _____ _
D. Fair Market Value (as estimated by the City):$ ______ _
The Price for which you may sell your Property ( or the Maximum Restricted Resale
Price)
(The greater of l(C) and l(D)): $ ______ _
In connection with the City's Option, you will owe a $ ___ to City.
If the City has assigned its option, the name of Designated Purchaser is _____ _
The City or its Designated Purchaser will follow up with you to.complete the sale of your
Property. If a Designated Purchaser purchases your Property, that designated purchaser may
assume the amount you owe on the Homebuyer Loan. If the City purchases your Property, the
D-1
amount you owe on the Homebuyer Loan shall be credited against the purchase price paid by the
City.
2. ___ City will check this Sentence #2 and complete other information listed in #2 if
the City intends for Owner to sell the Property to an Eligible Purchase during years 1-30 of the
Resale Restriction Agreement.
A. Affordable Sales Price: $ --------
B. Amount owed on Homebuyer Loan: $ ________ _
C. Full Sales Price (add numbers in l(A) and l(B)): $ ____ _
D. Fair Market Value (as estimated by the City):$ _____ _
The total price for which you may sell your Property ( or the Maximum Restricted Resale
Price) (the greater of l(C) and l(D)): $ ______ _
As noted in 2(B) above, the amount owed on the Homebuyer Loan is$ ____ . An
Eligible Purchaser is likely to assume the City Note and will then agree to repay the
amount of the Home buyer Loan.
You must market your Property to an "Eligible Purchaser" as required by Section 15 of
the Resale Restriction Agreement.
The Maximum Qualifying Income of Eligible Purchaser is:
___ Very Low Income Household (50% of Area Median Income)
1 person household $ ______ _
2 person household $ ______ _
3 person household $ ______ _
4 person household $ ______ _
5 person household $ ______ _
6 person household $ ______ _
___ Low Income Household (80% of Area Median Income)
1 person household $ ______ _
D-2
EXHIBITE
FORM OF OWNER ACKNOWLEDGEMENT OF CITY RESPONSE NOTICE
Name:
Address of Property:
I (We), ____________ [insert name(s)] hereby acknowledge that I (We)
received the City Response Notice (as described in Section 10 of the Resale Restriction
Agreement on _____ [insert date(s)].
By:
Owner signature
Date:
By:
Owner signature
Date:
E-1
To:
From:
EXHIBIT F
FORM OF OWNER REQUEST FOR CITY SUBORDINATION
TO REFINANCED FIRST LENDER LOAN
City of Carlsbad ("City")
-----------------("Owner(s)")
Property Address: _________________ ("Property")
The Owner hereby requests the City to approve the Owner's refinance of the existing first
mortgage on the Property. The Owner provides the following information which it certifies to be
true and correct:
1. $ Original Affordable Purchase Price of Property: -------
2. Original Homebuyer Loan Amount
3. Full Purchase Price of Property (1 plus 2) $ ______ _
3. Original principal balance of existing First Lender Loan: $ ______ _
4. Interest rate of existing First Lender Loan: $ ______ _
5. Outstanding principal balance of existing First
Lender Loan: $ -------
6. Monthly payments due on existing First Lender Loan $ ______ _
7. Principal amount of proposed new First Lender Loan: $ -------
8. Interest rate of Proposed new First Lender Loan: $ ______ _
9. Monthly payments to be due on new First Lender Loan: $ ______ _
The Owner hereby certifies the above infonnation is true and correct and this Owner(s) Request
is executed under penalty of perjury on the date(s) below.
By:
Owner signature Date
By:
Owner signature Date
F-1
Recording Requested by:
Fidelity National Title
San Diego Office
RECORDING REQUESTED PURSUANT
TO GOVERNMENT
CODE SECTION 27383
When Recorded Mail To:
City of Carlsbad
Housing Services Manager
1200 Carlsbad Village Drive
Carlsbad, CA 92008
DOC# 2024-0250576
111111111111 lllll 111111111111111111111111111111111111111111111 IIII IIII
Sep 17, 2024 01 :49 PM
OFFICIAL RECORDS
JORDAN Z. MARKS,
SAN DIEGO COUNTY RECORDER FEES: $0.00 (SB2 Atkins: $0.00)
PAGES: 7
NOTICE OF AFFORDABILITY RESTRICTIONS ON TRANSFER OF PROPERTY
(City of Carlsbad Affordable Housing Resale Program)
NOTICE IS HEREBY GIVEN, that the City of Carlsbad ("City"), has required Norma Galvan, a
single woman ("Owner") to enter into certain affordability covenants and restrictions entitled,
Affordability Restrictions on Transfer of Property, Occupancy, and Refinancing Restrictions and
Option to Purchase ("Restrictions"), with reference to certain real property located at 2671 Leighton
Circle, Carlsbad, CA 92009, San Diego County ("Property"), and further described in Exhibit A,
incorporated herein by reference.
The affordability covenants and restrictions contained in the Restrictions include without limitation
and as further described in the Restrictions:
1. The Property is restricted for resale to a low-income household at a purchase price
affordable to a low-income household, except as set forth in the Restriction.
2. The Owner must occupy the Property as the Owner's principal residence.
3. The Owner must give notice to the City before resale of the Property.
4. The Owner has granted the City an option to purchase the Property upon resale or default.
5. The Owner's rights to pledge the Property as security for a debt are limited.
In the event of any conflict between this Notice of Affordability Restrictions on Transfer of Property
("Notice") and the Restrictions, the terms of the Restrictions shall prevail.
The Restrictions have been recorded concurrently herewith and shall remain in effect for thirty (30)
years commencing on the date of recordation of the Restrictions.
~ Exempt from fee per GC27388.1 due to
being recorded in connection with
concurrent transfer that is subject to the
imposition of documentary transfer tax.
I! GOVERNMENT'CODE 27361.7 ll
I CERTIFY UNDER PENAL TY OF PERJURY THAT THE· NOTARY ·SEAL ON THE
DOCUMENT TO WHICH THIS.STATEMENT IS ATTACHED READS AS FOLLOWS:
Name of the N.otary:_S_he_l_b.;;_y_M_._N_e_ls_o_n _______________ _
2373071 8-31-2025 Commission -Number: · Date Commission Expires: ____ _
County Where Bond is Filed: __ S_a_n_D_ie"""g_o _____________ _
NNA1 • Manufacturer or Vendor Number: _________________ _
(Located on both sides of the notary seal border)
Signature:----:r1~~111ol91f-l.-lA ~~:d-"--.--------
. Firm Name (if applicable) •·
Place of Execution: San Diego Date: 9-16-2024 ------------
I Rec. Form #R 1 0 (Rl!v. 7/961
EXHIBIT A
LEGAL DESCRIPTION
ASSESSOR PARCEL NO.: 213-190-05-22
For APN/Parcel ID(s): 213-190-05-22
EXHIBIT A
Legal Description
THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF CARLSBAD, COUNTY OF SAN DIEGO,
STATE OF CALIFORNIA AND IS DESCRIBED AS FOLLOWS:
A CONDOMINIUM COMPRISED OF:
PARCEL 1 (COMMON AREA INTEREST):
AN UNDIVIDED FRACTIONAL INTEREST AS TENANT IN COMMON IN AND TO THE COMMON AREA OF PHASE 3
AS DESCRIBED ON THE MULBERRY AT BRESSI RANCH CONDOMINIUM PLAN (THE "CONDOMINIUM PLAN")
RECORDED ON FEBRUARY 11, 2005, AS DOCUMENT NO. 2005-117224, IN THE OFFICE OF THE COUNTY
RECORDER OF SAN DIEGO COUNTY, CALIFORNIA, BEING A PORTION OF LOT 1 OF CARLSBAD TRACT MAP CT
03-03, IN THE CITY OF CARLSBAD, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP
THEREOF NO. 14800 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY ON MAY 21,
2004. THE UNDIVIDED FRACTIONAL INTEREST HEREBY CONVEYED IS THE RECIPROCAL OF THE NUMBER OF
LIVING UNITS SHOWN ON THE CONDOMINIUM PLAN AS BEING WITHIN PHASE 3 OF THE CONDOMINIUM PLAN.
EXCEPTING THEREFROM ALL LIVING UNITS SHOWN ON THE CONDOMINIUM PLAN.
ALSO EXCEPTING THEREFROM, ALL OIL, OIL RIGHTS, MINERALS, MINERAL RIGHTS, NATURAL GAS RIGHTS,
AND OTHER HYDROCARBONS BY WHATSOEVER NAME KNOWN, GEOTHERMAL STEAM AND ALL PRODUCTS
DERIVED FROM ANY OF THE FOREGOING, THAT MAY BE WITHIN OR UNDER THE ABOVE DESCRIBED LAND
("LAND"), TOGETHER WITH THE PERPETUAL RIGHT OF DRILLING, MINING, EXPLORING AND OPERATING
THEREFOR AND STORING IN AND REMOVING SAME FROM SAID LAND OR ANY OTHER LAND, INCLUDING THE
RIGHT TO WHIPSTOCK OR DIRECTIONALLY DRILL AND MINE FROM LANDS OTHER THAN THE LAND, OIL OR
GAS WELLS, TUNNELS AND SHAFTS INTO, THROUGH OR ACROSS THE SUBSURFACE OF THE LAND
HEREINABOVE DESCRIBED, AND TO BOTTOM SUCH WHIPSTOCKED OR DIRECTIONALLY DRILLED WELLS,
TUNNELS AND SHAFTS UNDER AND BENEATH OR BEYOND THE EXTERIOR LIMITS THEREOF, AND TO REDRILL,
RETUNNEL, EQUIP, MAINTAIN, REPAIR, DEEPEN AND OPERATE ANY SUCH WELLS OR MINES WITHOUT,
HOWEVER THE RIGHT TO DRILL, MINE, STORE, EXPLORE OR OPERATE THROUGH THE SURFACE OR THE
UPPER 500 FEET OF THE SUBSURFACE OF THE LAND, AS RESERVED BY BRESSI GARDENLANE, LLC, BY DEED
RECORDED JANUARY 25, 2005, AS DOCUMENT NO. 2005-61440, OFFICIAL RECORDS.
PARCEL 2 (LIVING UNIT):
LIVING UNIT NO. 62, AS SHOWN UPON THE CONDOMINIUM PLAN.
PARCEL 3 (EXCLUSIVE USE AREAS):
THE EXCLUSIVE RIGHT TO USE ANY EXCLUSIVE USE AREA SHOWN ON THE CONDOMINIUM PLAN AS BEING
APPURTENANT TO THE LIVING UNIT DESCRIBED IN PARCEL 2 ABOVE.
PARCEL 4 (EASEMENT OVER ASSOCIATION PROPERLY):
A NON-EXCLUSIVE EASEMENT FOR USE AND ENJOYMENT OF AND ACCESS OVER THE ASSOCIATION
PROPERTY ("ASSOCIATION PROPERTY" IS DEFINED IN THE DECLARATION OF COVENANTS, CONDITIONS AND
RESTRICTIONS AND RESERVATION OF EASEMENTS FOR MULBERRY AT BRESSI RANCH DESCRIBED BELOW),
EXCEPTING ANY EXCLUSIVE USE AREA. THE EASEMENT HEREBY RESERVED, WHICH IS APPURTENANT TO
THE LIVING UNIT DESCRIBED ABOVE, IS FOR ACCESS AND USE OF THE ASSOCIATION PROPERTY, SUBJECT
TO THE PROVISIONS OF THE DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS AND
RESERVATION OF EASEMENTS FOR MULBERRY AT BRESSI RANCH AND THE RULES AND REGULATIONS OF
THE MULBERRY AT BRESSI RANCH HOMEOWNERS ASSOCIATION, A CALIFORNIA NONPROFIT MUTUAL
BENEFIT CORPORATION.