19D - RENTAL REHAB LOAN PROGRAM - Laserfiche WebLink

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8 8 e the borrower can demonstrate that the project's cash flow is inadequate to support both existing debt on the property, reasonable property maintenance and management costs, and the additional monthly payments attributable to the City loan. In these instances, payments may be deferred until such time as the borrower is able to begin making payments. Forgivable Loan for Hazardous Substances Costs Through the forgivable loan for remediation of hazardous substances costs, all costs attributable to lead-based paint, asbestos, mold and other hazardous substances in excess of $2,500 are converted to a grant and forgiven at the time all required rehabilitation is completed and the City has determined that the property is in compliance with all applicable City building codes. In order for the borrower to be eligible for the forgivable loan, the property must be professionally tested for the presence of hazardous materials, and only work items identified by testing to be in a deteriorated condition will be eligible for forgiveness. Should the borrower fail to complete the project and bring the property into compliance with all applicable City building codes, the costs associated with removal of hazardous substances will be subject to the same interest rate and amortization period as the amortized loan until such time as the property is in compliance. Failure to complete the work and bring the property into compliance with all applicable codes may result in an amortized loan that exceeds $75,000. For example, if a property requires $40,000 in conventional repairs and $50,000 to abate hazardous substances, failure to complete all the necessary work could result in an amortized loan of $90,000 or actual amount expended. EXHIBIT 1 Page 4 19D-7