1. (a) A purchaser of property assisted under the Program may repay a portion of the financial assistance provided by the state and increase its equity in the property if:

   1. (1) the State requires or approves such partial repayment;
   2. (2) no more than one partial repayment is made within any period of twelve (12) months; and
   3. (3) such partial repayment is not less than one thousand dollars ($1,000).

2. (b) Where a purchaser wishes to increase its equity in the assisted property, the entitlements of the purchaser and the Department respectively shall be calculated in accordance with the following formula:

   E =

   (V x E_R) + R

   V

   E is the proportion of the value of the property to which the purchaser is entitled after partial repayment

   V is the value of the property at the time of the partial repayment

   E_R is the proportion of the value of the property to which the purchaser is entitled immediately before the partial repayment is made

   R is the amount of the partial repayment plus the cost to the recipient of an appraisal

   On each occasion that a partial repayment is made, a new value for E shall be determined by applying the formula. The value of E thus determined will be used as E_R the next occasion on which a part repayment is made or as the proportion of the purchaser's equity in the property at sale or transfer. The amount to which a household shall be entitled on sale or termination of state financial assistance shall be the sale price or fair market value multiplied by the value of E at the time of sale or termination.

3. (c) Whenever there is an adjustment to the proportional amounts to which the Department and purchaser are entitled upon sale, a servicer of State loans shall keep a record of such an adjustment and shall forward a copy to the Department and governmental agency.

Note: Authority cited: Section 50406, Health and Safety Code. Reference: Sections 50775, 50776 and 50777, Health and Safety Code.

History

1. Amendment filed 11-13-80 as an emergency; effective upon filing (Register 80, No. 46). A Certificate of Compliance must be transmitted to OAL within 120 days or emergency language will be repealed on 3-13-81.

2. Certificate of Compliance transmitted to OAL 3-13-81 and filed 4-14-81 (Register 81, No. 16).

3. Amendment filed 6-11-81 as an emergency; effective upon filing (Register 81, No. 25).

4. Order of Repeal of 6-11-81 emergency order filed 6-19-81 by OAL pursuant to Government Code Section 11349.6 (Register 81, No. 25).

5. Amendment of subsections (a)(1) and (c) filed 7-6-81 as an emergency; effective upon filing (Register 81, No. 28). A Certificate of Compliance must be transmitted to OAL within 120 days or emergency language will be repealed on 11-3-81.

6. Certificate of Compliance as to 7-6-81 order transmitted to OAL 10-23-81 and filed 11-18-81 (Register 81, No. 47).