Item 39 - Relocation Plan for Fairview Bridge Replacement and Street Improvements

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Fairview Bridge Replacement and Street Improvements: Relocation Plan 16 the prompt return of the City funds, in the event escrow should fail to close within a reasonable period of time. Final determination about the type of relocation benefits and assistance for which the household is eligible will be determined upon verification of the household’s occupants and income. Federal laws and guidelines provide a basic entitlement of up to $31,000 to compensate the owner for 1) purchase price differential; 2) mortgage interest differential (if applicable); and, 3) incidental expenses. a. Price Difference Differential The Purchase Price Differential is based on three factors: Acquisition Price: The price paid by the City of Santa Ana for the Project dwelling; Actual Purchase Price: The actual price paid for a replacement dwelling, and; Comparable Replacement Cost: The cost of a decent, safe, and sanitary dwelling comparable to the dwelling acquired by the City of Santa Ana. The purchase price differential amount is determined by comparing the price of the acquired dwelling (including any proceeds obtained through condemnation) to the lesser of the actual cost paid for a replacement home versus the price of the comparable dwelling used to compute eligibility in the Notice of Eligibility (NOE) issued to the displaced owner. b. Mortgage Interest Differential The purpose of the Mortgage Interest Differential Payment is to compensate homeowners for increased costs between the acquired dwelling and the replacement dwelling. The payment for increased mortgage interest cost shall be the amount that would reduce the mortgage balance on a new mortgage to an amount that could be amortized with the same monthly payment for principal and interest as that for the mortgage(s) on the displacement dwelling. In addition, payments shall include other debt service costs, if not paid as part of incidental costs. To be eligible for this payment, the mortgage on the dwelling being acquired must have been in place, as a valid lien, for at least 90 days prior to the City’s initial written offer to purchase. c. Incidental Expenses – Closing Costs One-time, non-recurring closing costs associated with the purchase of a comparable, replacement dwelling are compensable. Examples of such compensable expenses include costs for: a property survey; preparation of a legal description and deed; recording fees; title insurance; revenue stamps and transfer taxes; loan application fees; loan origination fees; appraisal fees; a credit report; certification for structural soundness; and, termite inspection, when required. Prepaid recurring expenses for mortgage interest, property taxes and insurance are not compensable. The total Relocation Housing Payment (RHP) is the sum of the Purchase Price Differential, Mortgage Interest Differential, and compensable Incidental Expenses.