FAUQUIER HABITAT FOR HUMANITY LETTER OF NOTIFICATION AND ACCEPTANCE

Transcription

1 FAUQUIER HABITAT FOR HUMANITY LETTER OF NOTIFICATION AND ACCEPTANCE date Jane Dough 22 Lost Highway Hollowville, VA Dear, It is our pleasure to welcome you into partnership with Fauquier Habitat for Humanity. You have been selected to purchase a house that will be constructed by you and by Fauquier Habitat for Humanity (hereafter referred to as FHFH or Habitat ). During the recent visit to your home by FHFH representatives, Habitat s partnership housing program was explained to you and your family. This letter only serves to review those discussions. This letter is not a contract because it only states our mutual understanding and it lacks the specific elements needed to form a contract (i.e., price of the home, time when construction will be completed, specific plans for the house, etc.). Prior to Habitat s agreeing to build and sell you the house, you and your family will need to satisfy the following requirements: 1. DEFINITION OF HOMEOWNER AND IMMEDIATE FAMILY: Based on the application submitted, FHFH has accepted the following family members into a partnership: a. Name: Age: b. Name: Age: c. Name: Age: d. Name: Age: e. Name: Age: f. Name: Age: The purpose of this partnership is to provide a decent, affordable home to be purchased by the approved family. The home is to be the PRIMARY RESIDENCE for the homeowner and the immediate family as listed above. The home is not be utilized as an income property; no portion of the home may be rented without prior approval of FHFH. 2. DOWN PAYMENT: Habitat requires a $500 down payment to be paid once the Letter of Intent is signed by Fauquier Habitat and the Partner Family. The first $250 must be paid within 90 days of signing the Letter of Intent. The balance of Page 1 of 9

2 $250 must be paid prior to the start of construction of the Partner Family s home. This down payment is refundable if you and your family either fail to meet the requirements of the partnership housing program or choose to withdraw from the program. 3. SWEAT EQUITY: Families must work towards a minimum of 400 sweat equity hours. Each adult (18 years or older) must work at least 50 sweat-equity hours as a Habitat partner on their own house. When one or more Habitat homes is under construction, families must work a minimum of 30 hours per quarter. Family and friends of the family may contribute to the remaining hours by working on the jobsite or helping with mailings, publicity, fund raising, providing refreshments to other volunteers, or serving at any Fauquier Habitat function. Our volunteers work on construction normally on Saturdays from 8 AM to 2 PM and Mondays and Wednesdays from 8 AM to 12 Noon. You are welcome to work during these hours whether or not you are skilled in construction work. In addition, we may be able to provide opportunities for you to volunteer in other ways. To find out the current week s building schedule and other opportunities to work your required hours, you can call your volunteer partner or the FHFH office at HOMEOWNER WORKSHOPS: All prospective homeowners will attend a mandatory series of workshops that will cover many topics relating to home ownership, including, but not limited to, Partnership, Home Maintenance/Repair, Budgeting/Money Management, Interior and Exterior planning, and Community Living. Habitat will not begin construction of your house until you have worked at least 50 sweatequity hours and signed a Letter of Intent. In the event you decide not to continue working with FHFH, we will refund any down payment you have made. However, if for any reason you are no longer a Habitat partner family, we will not reimburse or otherwise pay you for any sweatequity hours. (Initial ) Your acceptance as a Habitat partner family is based on the information contained in your application. In the event Habitat determines that the information contained in your application was materially inaccurate or if there is a materially negative change in your financial situation, (such as the loss of employment), Habitat reserves the right to terminate your selection as a partner family. You should notify FHFH as soon as possible if there is a significant change in your financial situation, or if there is an increase or decrease in the number of family members expected to live in the home. Habitat is committed to working with its partner families when they experience difficulties. In addition, FHFH reserves the right to terminate your selection as a partner family if: a. You experience change negative in your financial situation; b. You experience a change in persons expected to live in the home and do not notify us; Page 2 of 9

3 c. You fail to attend the required homeowner workshops within 12 months of the date of this letter and no later than one month before settlement; d. You or the adult members of the household fail to complete required sweat equity hours; e. A potential resident is on the Sexual Offender list; f. You fail to make your complete down payment within 3 months of signing the Letter of Intent or before the beginning of construction, whichever comes first. (Initial ) This letter is to help you to understand what is involved in Habitat for Humanity s partnership ministry. In acknowledging this letter, you are indicating that you understand this partnership and that you will complete the above requirements. You are also agreeing to become involved as a partner in the ministry of Habitat. Fauquier Habitat will assign you a volunteer partner to help you through this process. By signing this letter, Habitat is indicating that we will work with you in developing a plan for a simple, decent house for you and your immediate family in accordance with the attached basic Habitat house description. At the appropriate time, we will begin to review with you the possible cost of construction of the house, the time when construction will begin, and hopefully be completed, and other matters. In addition, Fauquier Habitat will share where your new house will be built. Once there is a plan and once you have made the $500 cash down payment and worked the necessary 50 sweat-equity hours, you will sign a Letter of Intent (a contract) and Habitat will work with you to begin the construction of your house. Houses constructed by Fauquier Habitat are built with your labor and with volunteer labor. In addition, many materials and the money used to build your house have been donated. While Habitat will make reasonable efforts to complete the house in accordance with the plan, it is unable to promise that all houses will be built according to the plan or that all houses will be built. Therefore, Fauquier Habitat for Humanity cannot guarantee completion dates or the total construction costs of the houses it builds. Fauquier Habitat will agree to sell a house to you at cost and finance the purchase price with a no-interest mortgage. When you move into your new house, we will provide you with a schedule of monthly house payments which includes mortgage, insurance premium, property taxes, and (when applicable) Home Owners Association fee. Fauquier Habitat will hold a mortgage on the house that will be released when you have finished making all of your house payments. Your deed will contain a right of first refusal that will allow Fauquier Habitat to repurchase your house in the event you decide to sell it in the future. In addition, you will sign a second note and mortgage that provides in the event you sell the house you may have to give Fauquier Habitat a percentage of any profit you realize. A copy of Fauquier Habitat s resale policy is attached to this letter. You and Fauquier Habitat for Humanity both understand that we must complete the requirements set forth in this letter and that we need to live up to the spirit of Habitat for Humanity partnership housing program. If you are unable to meet these requirements, we will not be able to continue the partnership with you. Page 3 of 9

4 has agreed to be your volunteer Habitat partner. She/he should be your primary point of contact. She/he can be reached at. You can always telephone the Habitat office at Again, welcome to the Fauquier Habitat partnership. We wish you every success in your efforts to own a home of your own and look forward to working with you toward that goal. Sincerely, Brenda Drerenberger Executive Director Fauquier Habitat for Humanity Read, understood, and accepted this day of 20 Prospective homeowner Signature Prospective homeowner Signature Page 4 of 9

5 Fauquier Habitat for Humanity Standard House Plan All construction is to be in compliance with the building code for the jurisdiction where the home is built. Standard Home Approximate size, 1050 square feet, three bedrooms, one bath. Larger homes are built on recommendation of the Family Selection Committee and with the approval of the Board of Directors (900 square feet for a two bedroom house, 1150 square feet for a four bedroom house). Exterior Gable roof Steel clad entry doors, solid entry and up to nine lights for side or rear door. Vinyl siding and vinyl or aluminum fascia. Fiberglass roof shingles. Rain gutters, downspouts, and splash blocks. Shutters on front windows. Storm doors. Insulated windows. Covered front stoop. Entry walkway. Lawn graded, seeded, and covered with straw. Foundation plantings, if provided by donation. Shed. Interior Dining/living area. Kitchen Electric range with hood. Factory built cabinets. Laminated countertops. Refrigerator, standard style, no ice maker. Double stainless steel sink. Closet, each bedroom. One extra closet, linen or coat. Bath accessories Factory built cabinet, glass mirror or medicine cabinet. Two towel bars, soap dish, paper holder. Privacy shades for all bedrooms and bath. Page 5 of 9

6 Smoke detector. Heat pump (12 SEER). Hot water heater. Washer and dryer. Ceiling light fixtures with fan support boxes. Telephone jacks, two locations (single telephone line). TV cable jacks, two locations. Carpet, five year stain resistant, and ten year wear warranty, second upgrade pad. Vinyl in kitchen, utility area, and bath. Interior paint, off white. Special Money Options The sum of $400 is designated for the use of each family in individualizing their home. These funds may be used for the following items: Ceiling fans. Power roof vent. Exterior motion detector lights. Rough-in for dishwasher. Homeowner must provide and install after occupancy. If a rough-in is provided one standard base cabinet will not be installed and an unfinished space will exist. Carpet upgrade. Privacy shades in additional rooms. Extra shutters. Partner Family: Address: Family Partner: The family partner communicates requests for these options promptly to the Building Committee so the appropriate materials can be ordered. Any existing appliances that are moved in will reduce the total cost of the home. NOTE: When rehabilitating an existing home Fauquier Habitat will ordinarily restore or replace existing features of the home to original condition, assuming that such restoration or replacement does not exceed what is provided in a new home. The Board of Directors has the final authority to decide whether any specific item, either purchased or donated, is appropriate for inclusion in a Habitat home. At the discretion of the Board of Directors the standard home may be modified to accommodate the medical needs of an occupant who is handicapped. Page 6 of 9

7 Approved, Board of Directors, Fauquier Habitat for Humanity, February (Initial ) Prospective Homeowner Page 7 of 9

8 RIGHT OF FIRST REFUSAL AND SHARED APPRECIATION PROVISION Right of First Refusal. Borrower covenants and agrees that in the event it shall desire to sell or convey the Property during the term of this Security Instrument, Borrower shall first offer the Property to Lender, or Lender's successor in interest, in the following manner: Borrower shall serve notice in writing to Lender, or its successor in interest, by registered mail, return receipt requested. The notice shall indicate that Borrower has a bona fide written offer for the sale of the Property, the name and address of the person desiring to purchase the Property, and the sales price and other terms of the sale. The notice shall also contain an offer to sell the Property to Lender, or its successor in interest, upon the terms and conditions set forth in the bona fide offer. For a period of thirty (30) days after the receipt of the notice, Lender, or its successor in interest, shall have the right to purchase the Property in accordance with the terms of the bona fide offer; provided, however, that Lender shall have the right to receive a credit toward the purchase price of the Property from Borrower in the amount of the outstanding principal balance due under the Note, the Subordinated Security Instruments, and any sums due under Paragraph 29 below. If Lender, or its successor in interest, fails to exercise the right to purchase set forth in this Paragraph 28, Borrower may sell or convey the Property, to the party making the bona fide offer, but only at the price and upon the terms specified in the notice; provided, however, that Lender shall not waive its rights under Section 18 of this Security Instrument by waiving its right of first refusal. In the event Lender timely notifies Borrower that it elects to purchase the Property on the terms provided in the notice set forth in the preceding paragraph, Lender and Borrower shall promptly, but no later than sixty (60) days after the date of notice from Lender to Borrower, execute such usual and customary documents as shall be required in order to consummate such transaction. Sale of Property. In the event the Property shall be sold (including, without limitation, any foreclosure sale or transfer by deed in lieu of foreclosure), refinanced or otherwise encumbered by Borrower, there shall be due and payable to Lender, in addition to the then unpaid principal balance of the 1 st, 2 nd and/or additional mortgages, a share of "Appreciation in Value" of the Property (defined below). a. The Appreciation in Value shall be computed as the difference between: (i) the proceeds of any sale or of any new mortgage loan, net of normal sales and closing costs and (ii) the "ownership basis" of Borrower. The "ownership basis" shall be the sum of the initial cost of the Property actually paid (not including the sums due and owing under this Security Instrument and the Subordinated Security Instruments), pursuant to Sections 1 and 2, by Borrower to the Lender and the cost of any improvements actually made by Borrower to the Property, at its own expense, provided that such improvements and the cost thereof shall have been approved in writing by Lender. b. In addition, the entire proceeds of any subordinate or junior mortgage loan other than the Second Deed of Trust actually paid by Borrower shall be deemed to be Appreciation in Value. Page 8 of 9

9 c. If any such sale, refinancing or encumbrance shall occur within three (3) years from the date of this Security Instrument, all of such Appreciation in Value shall be payable to Lender. d. After three (3) years from the date of this Security Instrument, Lender shall be entitled to that amount expressed as a percentage of the Appreciation in Value, if any, equal to one hundred, minus the product of the percentage of the original principal amount actually paid on the Note, multiplied by two (2), up to ten (10) years from the date of this Security Instrument. For example, if Borrower has repaid to Lender fifteen percent (15%) of the amount evidenced thereby, Lender shall retain seventy percent (70%) of the Appreciation in Value. Solely for the purpose of complying with the provisions of Section of the Virginia Code, as amended, and without modifying or limiting the foregoing, the Grantor states the following: NOTICE THE DEBT SECURED HEREBY IS SUBJECT TO CALL IN FULL OR THE TERMS THEREOF BEING MODIFIED IN THE EVENT OF SALE OR CONVEYANCE OF THE PROPERTY CONVEYED. (Initial ) Prospective Homeowner \\Director\My Documents\Family Selection\FAM-SEL\Acceptance Letter approved doc Page 9 of 9