1998-751915 D00 1998-0751915
NOV 1
FREE RECORDING REQUESTED
PURSUANT TO GOV. CODE SECTION
27383 ..
8MI: 0.00
City of Encinitas
Community Development
505 S. Vulcan Avenue
Encinitas, CA 92024
And When Recorded Mail To: ~ ~
City of Encinitas
Community Development
50~ S. Vulcan Avenue
Encinitas, CA 92024
DEED OF TRUST
(This is a Second Deed of Trust)
THJi~ DEED OF TRUST is m.a, de this ? day of November, 1998, among the
Tmstor, Norma"~i~ Flores (herein Borrower ), and Chicago Title Company (herein
"Trustee"), and the Beneficiary, CITY OF ENCINITAS (herein "CITY"), whose address is 505 S.
Vulcan Avenue, Encinitas, California 92024.
BORROWER, in consideration of the indebtedness herein recited and the trust herein
created, irrevocably grants and conveys to Trustee, in trust, with power of sale, the following
described property located in the County of San Diego, State of California:
see Exhibit "A' attached hereto and incorporated herein by this reference
which has the address of 434 Carmel Creeper Place, Encinitas, California 92024 (herein "Property
Address"):
TOGETHER with all the improvements now and hereafter erected on the Property,
and all easements, rights, appurtenances and rents (subject, however, to the rights and authorities
given herein to CITY to collect and apply such rents), all of which shall be deemed to be and remain
part of the property covered by this Deed of Trust; and all of the foregoing, together with said
property (or the leasehold estate if this Deed of Trust is on a leasehold) are hereinafter referred to as
the "Property";
TO SECURE to CITY the repayment of the indebtedness evidenced by Borrower's
Promissory Note dated l~lovember 13 , 1998, and Note Rider, and extensions and
renewals there,(herein collectively referred to as the "Note"), in the principal sum of Twent¥-E ±q_ht
Thousand lq~undred Twen _ty-Tw~9__ U.S. Dollars$.2 _8 ,~9_ 2 2, with interest thereon, fully deferred
with the total ifidebtedness, if not sooner paid, due and payable upon default by Borrower, a
Prohibited Transfer as defined in the Deed of Trust. This Note will be forgiven on the date which is
fifty-five (55) years after the recordation date hereof, if Borrower has not defaulted or made a
Prohibited Transfer of the Property, or any portion thereof; CITY has received the payment of all
other sums, with interest thereon, advanced in accordance herewith to protect the security of this
Deed of Trust; and CITY has received the full performance of the covenants and agreements of
Borrower herein contained.
Borrower covenants that Borrower is lawfully seized of the estate hereby conveyed and
has the right to grant and convey the Property, and that the Property is unencumbered except for
encumbrames of record. Borrower covenants that Borrower warrants and will defend generally the
title to the Property against all claims and demands, subject to encumbrances of record.
UNIFORM COVENANTS
Borrower and CITY covenant and agrees as follows:
1. Payment of Principal and Interest. Borrower shall promptly pay when due
the principal and interest indebtedness evidenced by the Note.
2. Payment of Taxes and Insurance. To protect the security of the Deed of
Trust, Trustor agrees to pay, at least ten (10) days before delinquency, all taxes and assessments
affecting said property, including assessments on appurtenant water stock; when due, all
encumbrances, charges and liens, with interest, on said property or any part thereof, which appear to
be prior or superior hereto; and all costs, fees and expenses of this Trust.
Should Trustor fail to make any payment or to do any act as herein provided,
then Beneficiary or Trustee, without obligation to do so and without notice to or demand upon
Trustor and without releasing Trustor from any obligation hereof, may make or do the same in such
manner and to such extent as either may deem necessary to protect the security hereof, Beneficiary or
Trustee being authorized to enter upon said property for such purposes; appear in and defend any
action or proceeding purporting to affect the security hereof or the rights or powers of Beneficiary or
Trustee; pay, purchase, contest or compromise any encumbrance, charge or lien which in the
judgment of either appears to be prior or superior hereto; and, in exercising any such powers, pay
necessary expenses, employ counsel and pay his reasonable fees.
/Encinitas/Deed.O05 Page 2 of 13
3. Application of Pa~gments. Unless applicable law provides otherwise, all
payments received by CITY under the Note shall be applied by CITY first in payment of amounts
advanced by CITY to CITY by Borrower, then to interest payable on the Note, and then to the
principal of the Note.
4. Prior Mortgages and Deeds of Trust; Charges, Liens. Borrower shall
perform all of Borrower's obligations under any mortgage, deed of trust or other security agreement
with a lien which has priority over this Deed of Trust, including Borrower's covenants to make
payments when due. Borrower shall pay or cause to be paid all taxes, assessments and other charges,
fines and impositions attributable to the Property which may attain a priority over this Deed of Trust,
and leasehold payments, if any.
5. Hazard Insurance. Borrower shall keep the improvement(s) now existing or
hereinafter erected on the Property insured against loss by fire, hazards included within the terms
"extended coverage", and such other hazards as CITY may require and in such amounts and for such
periods as CITY may require.
The insurance carrier providing the insurance shall be chosen by Borrower
subject to approval by CITY, provided that such approval will not be unreasonably withheld. All
insurance policies and renewals thereof shall be in a form acceptable to CITY and shall include a
standard mortgage clause in favor of and in a form acceptable to CITY. CITY has the right to hold
the policies and renewals thereof, subject to the terms of any mortgage, deed of trust or other security
agreement with a lien which has priority over this Deed of Trust.
In the event of loss, Borrower shall give prompt notice to the insurance carrier
and CITY. CITY may make proof of loss if not made promptly by Borrower.
If Property is abandoned by Borrower, or if Borrower fails to respond to CITY
within thirty (30) days from the date notice is mailed by CITY to Borrower that the insurance carrier
offers to settle a claim for insurance benefits, CITY is authorized to collect and apply the insurance
proceeds at CITY's option either to restoration or repair of the Property or to the sums secured by
this Deed of Trust.
6. Preservation and Maintenance of Property. Borrower will keep the Property
in good repair and shall not commit waste or permit impairmem or deterioration of the Property and
shall comply with the provisions of any lease if this Deed of Trust is on a leasehold. Borrower shall
perform all of Borrower's obligations under the declaration of covenants, conditions and restrictions
creating or governing the condominium, the bylaws and regulations of the condominium, and
constituent documents.
7. Protection of CITY Security. If Borrower fails to perform the covenants and
agreements contained in this Deed of Trust, or if any action or proceeding is commenced which
materially affects CITY's interest in the Property, the CITY, at CITY's option, upon notice to
/En¢initas/Deed.005 Page 3 of 13
429
Borrower, may make such appearances, disburse such sums including reasonable attorneys' fees, and
take such action as is necessary to protect CITY's interest. If CITY's required mortgage insurance is
a condition of making the loan secured by this Deed of Trust, Borrower shall pay the premiums
required to maintain such insurance in effect until such time as the requirement for such insurance
terminates in accordance with Borrower's and CITY's written agreement or applicable law.
Any amounts disbursed by CITY pursuant to this paragraph, with interest
thereon, at the Note rate, will become additional indebtedness of Borrower secured by this Deed of
Trust. Unless Borrower and CITY agree to other terms of payment, such amounts will be payable
upon notice from CITY to Borrower requesting payment thereof. Nothing contained in this
paragraph will require CITY to incur any expense or take any action hereunder.
8. Inspection. CITY may make or cause to be made reasonable entries upon and
inspections of the Property, provided that CITY will give the Borrower notice prior to any such
inspection, specifying reasonable cause therefor related to CITY's interest in the property.
9. Condemnation. The proceeds of any award of claim for damages, direct or
consequential, in connection with any condemnation or other taking of the Property, or part thereof,
or for conveyance in lieu of condemnation, are hereby assigned and shall be paid to CITY subject to
the terms of any mortgage, deed of trust or other security agreement with a lien which has priority
over this Deed of Trust.
10. Borrower Not Released; Forbearance by CITY Not a Waiver. Extension of
the time for payment or modification of amortization of the sums secured by this Deed of Trust
granted by CITY to any successor in interest of Borrower shall not operate to release, in any manner,
the liability of the original Borrower and Borrower's successors in interest. CITY shall not be
required to commence proceedings against such successor or refuse to extend time for payment or
otherwise modify amortization of the sums secured by this Deed of Trust by reason of any demand
made by the original Borrower and Borrower's successors in interest. Any forbearance by CITY in
exercising any right or remedy hereunder, or otherwise afforded by applicable law, shall not be a
waiver of or preclude the exercise of any such right or remedy.
11. Successors and Assi.om Boo_nd, Joint and Several Liability_; Co-Signors.
The covenants and agreements herein contained shall bind, and the rights hereunder shall inure to, the
respective successors and assigns of CITY and Borrower, subject to the provisions of paragraph 16
hereof. All covenants and agreements of Borrower shall be joint and several. Any Borrower who
co-signs this Deed of Trust, but docs not execute the Note:
(a) is co-signing this Deed of Trust only to grant and convey that
Borrower's interest in the Property to Trustee under the terms of this Deed of
Trust;
(b) is not personally liable on the Note or under this Deed of Trust; and,
/Encinitas/Deed.005 Page 4 of 13
(c) agrees that CITY and any other Borrower hereunder may agree to
extend, modify, forbear or make any other accommodation with regard to the terms of
this Deed of Trust or the Note, without that Borrower's consent and without releasing
that Borrower or modifying this Deed of Trust as to that Borrower's interest in the
property.
12. Notice. Except for any notice required under applicable law to be given in
another manner:
(a) any notice to Borrower provided for in this Deed of Trust shall be
given by delivering it or by mailing such notice by certified mail, addressed to
Borrower at the Property address or such other address as Borrower may designate by
notice to CITY as provided herein; and,
(b) any notice to CITY will be given by certified mail, return receipt
requested, to CITY's address stated herein or to such other address as CITY may
designate by notice to Borrower as provided herein.
Any Notice provided for in this Deed of Trust shall be deemed to have been given to Borrower or
CITY when given in the manner designated herein.
13. Governinli Law, Severability. The state and local laws applicable to this
Deed of Trust shall be the laws of the jurisdiction in which the Property is located. The foregoing
sentence shall not limit the applicability of federal law to this Deed of Trust. In the event that any
provision or clause of this Deed of Trust or the Note conflicts with applicable law, such conflict shall
not affect other provisions of this Deed of Trust or the Note which can be given effect without the
conflicting provision and, to this end, the provisions of this Deed of Trust and the Note are declared
to be severable. As used herein, "costs", "expenses" and "attorneys' fees" include all sums to the
extent not prohibited by applicable law or limited herein.
14. Borrower's Copy. Borrower shall be furnished a conformed copy of the Note
and this Deed of Trust at the time of execution or after recordation hereof.
15. Notice to CITY. Borrower agrees that it will give the CITY notice of any
prospective transfer, sale, conveyance, rental or subletting not less than forty five (45) days before the
proposed sale, transfer, conveyance, rental or subletting by personal delivery of a notice at the
address set forth for the CITY on Page 1 of this Deed of Trust. Time is of the essence.
16. Lease of Property Prohibited. During the term of the affordability
restrictions as set forth in Paragraph 17(e) of this Deed of Trust, the Borrower shall not rent or sublet
the Property, or any part thereof, to any person and/or entity, unless the person is an income
"Eligible Household". As used herein, an income "Eligible Household" shall mean a household
whose eligible income does not exceed eighty percent (80%) of the Area Median Income for San
Diego, as determined from time to time by the U.S. Department of Housing & Urban Development.
/Encinitas/Deed.005 Page 5 of 13
Further, the rent charged to the Eligible Household shall not exceed thirty percent (30%) of eighty
percent (80%) of the Median Income, minus a utility allowance. For purposes of this restriction,
rents shall be based upon a household size of three (3). Leasing of the Property to a household that is
not an Eligible Household or at rents that exceed the restricted rental rates set forth herein shall be
deemed a prohibited transfer of the Property, within the meaning of Paragraph 18, and shall trigger
the right of the CITY to foreclose and/or exercise its First Right of Refusal.
17. Transfer, Conveyance of Property Restricted for Fifty_ Five (55) Years.
The sale, transfer and/or conveyance of the Property is restricted as follows:
If Borrower sells, transfers or conveys the Property less than fifty five (55)
years after the date of this Deed of Trust, then said sale, conveyance and/or transfer shall be subject
to the following:
(a) The Property may only be sold, transferred or conveyed to a
subsequent purchaser whose income is less than eighty percent (80%) of the median
income as def'med by HUD from time to time for the San Diego metropolitan area, as
adjusted for family size and as verified and approved by CITY.
(b) Except as provided in Paragraph 17(d) hereof, the Property must be
used only as the principal residence of the subsequent purchaser during the term of the
Declaration, i.e, fifty five (55) years.
(c) The sale price to the subsequent purchaser must be at a price that is
"affordable to the subsequent purchaser(s)". "Affordable to the subsequent
purchaser(s)" is achieved if the monthly payments for principal, interest, property
taxes, insurance and a utility allowance determined by CITY do not exceed thirty
percent (30%) of the gross income of a family with an income that is eighty percent
(80%) of the median income for the area, adjusted for a family size of three.
(d) In the event that a Transferor is unable to f'md, despite diligent efforts to
do so, an Eligible Person or Family to purchase a Housing Unit, the Transferor may
sell the Housing Unit to a person other than an Eligible Person or Family by first
offering to sell the Housing Unit to the CITY for a purchase price equal to highest
purchase price at which an Eligible Person or Family could qualify to purchase the
Housing Unit at an Affordable Housing Cost. The CITY shall accept or reject the
offer to sell the Housing Unit to the CITY within thirty (30) days of the date of receipt
of the offer to sell. In the event that the CITY declines to purchase the Housing Unit,
the Transferor may proceed to market and sell the Housing Unit to any purchaser
without regard to the resale conditions set forth in this Agreement; provided that upon
or prior to the close of escrow the Transferor shall pay to the CITY the greater of: !)
the amount of the Second Deed of Trust, or 2) "Equity Sharing Amount", hereinafter
defmed.
/Encinitas/Deed.005 Page 6 of 13
The "Equity Shying Amount" means an amount equal to the appreciation in
the value of the Property determined by the difference between the Sales Price
and the Affordable Housing Price (as defined below).
The "Affordable Housing Price" is the purchase price that could be paid by an
Eligible Person or Family at an Affordable Housing Cost.
The "Sales Price" is the price to be paid by the buyer of the Property (the
"Buyer") to the Transferor for Transferor's interest in the Property, exclusive
of escrow fees, title insurance costs, broker's commissions, loan fees or any
other closing or transaction costs.
Upon a showing of hardship by the Transferor to the CITY in writing, the CITY may waive
any one or combination of the following: the resale restrictions, the Transferor's obligation to sell to
the CITY, the Transferor's obligation to pay the CITY the Equity Sharing Amount and/or the
Transferor's obligation to pay the CITY the amount of the Second Deed of Trust.
(e) The affordability requirement shall remain in effect for a total of fifty
five (55) years, measured from the date of this Deed of Trust. This requirement shall
remain in full force and effect against all subsequent purchasers during the restricted
term. This restriction shall also apply to sales of the Property from the subsequent
purchaser to other purchaser(s) during the restricted term.
(f) If the Borrower fails, refuses or is unable to convey, sell, rent or
transfer the Property to a person or persons meeting the requirements of paragraphs
16, 17a through 17e, inclusive, before the end of the affordability term as defined in
paragraph 17e, then such transfer shall be deemed a Prohibited Transfer as del'reed in
Paragraph 18 hereof.
These provisions of paragraph 17 shall bind the heirs, successors and assigns of the Borrower.
18. Prohibited Transfer. If Borrower sells, agrees to sell, conveys, rents and/or
transfers the Property in violation of the terms of Paragraphs 16 and 17 hereof, then CITY may, at its
option, in addition to any and all other remedies available to it, require immediate payment in full of
all sums secured by the Second Deed of Trust. In the instance of a prohibited transfer, the Transferor
shall pay to the CITY the greater of: 1) the amount of the Second Deed of Trust, including any
interest, as described in the Note, or 2) "Equity Sharing Amount", as defined above.
As an alternative, CITY may, at its option, purchase the Property for a
purchase price equal to the highest purchase price at which an Eligible Person or Family could qualify
to purchase the Housing Unit at an Affordable Housing Cost. However, these options shall not be
exercised by CITY if such exercise is prohibited by federal law as of the date of the Deed of Trust or
if the CITY has executed a separate written waiver of these options.
Page 7 of 13
If CITY exercises any of these options, CITY shall give Borrower Notice of
Acceieration or, in the alternative, Notice of Exercise of First Right of Refusal Option. The notice
shall provide a period of not less than thirty (30) days from the date that the notice is delivered or
mailed within which Borrower must pay all sums secured by the Deed of Trust or must enter into an
escrow to convey the Property to CITY, depending upon the option exercised by CITY. If Borrower
fails to pay these sums or enter into an escrow prior to the expiration of this period, CITY may
invoke any remedies permitted by the Deed of Trust without further notice or demand on Borrower.
The escrow contemplated by this Paragraph 18 must close not more than ninety (90) days after CITY
receives notice of such sale, agreement to sell, conveyance, rental or transfer of the Property in
violation hereof.
NON-UNIFORM COVENANTS
Borrower and CITY further covenant and agree as follows:
19. Acceleration, Remedies. Upon Borrower's breach of any covenant or
agreement of Borrower in this Deed of Trust, including the covenants to pay when due any sums
secured by this Deed of Trust, and those contained in paragraphs 16, 17 and 18 hereof, CITY, prior
to acceleration, shall give notice to Borrower as provided in paragraph 12 hereof specifying:
(a) the breach;
(b) the action required to cure such breach;
(c) a date, not less than ten (10) days from the date the notice is mailed to
Borrower, by which such breach must be cured; and,
(d) 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 Property.
The notice shall further inform Borrower of the right to reinstate after
acceleration and the right to bring a court action to assert the nonexistence of a default or any other
defense of Borrower to acceleration and sale. If the breach is not cured on or before the date
specified in the notice, CITY, at CITY's option, may 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 other remedies permitted by applicable law. CITY shall be entitled to collect all reasonable
costs and expenses incurred in pursuing the remedies provided in this paragraph 19, including, but
not limited to, reasonable attorneys' fees.
If CITY invokes power of sale, CITY shall execute or cause Trustee to execute
a written notice of the occurrence of an event of default and of CITY's election to cause the Property
to be sold and shall cause such notice to be recorded in each county in which the Property or some
part thereof is located. CITY or Trustee shall mail copies of such notice in the manner prescribed by
applicable law. Trustee shall give public notice of sale to the persons and in the manner prescribed
Page 8 of 13
by law. After the lapse of such time as may be required by applicable law, Trustee, without demand
on Borrower, shall sell the Property at public auction to the highest bidder at the time and place and
under the terms designated in the notice of sale in one or more parcels and in such order as Trustee
may determine. Trustee may postpone sale of all or any parcel of the Property by public
announcement at the time and place of any previously scheduled sale. CITY or CITY's designee may
purchase the Property at any sale.
Trustee shall deliver to the purchaser Trustee's deed conveying the Property so
sold without any covenant or warranty, expressed or implied. The recitals in the Trustee's deed shall
be prima facie evidence of the truth of the statements made therein. Trustee shall apply the proceeds
of the sale in the following order:
(1) to all reasonable costs and expenses of the sale, including, but not
limited to, reasonable Trustee's and attorneys' fees and costs of title
evidence;
(2) to all sums secured by this Deed of Trust; and,
(3) the excess, if any, to the person or persons legally entitled thereto.
20. Borrower's Right to Reinstate. Notwithstanding CITY's acceleration of the
sums secured by this Deed of Trust due to Borrower's breach, Borrower shall have the right to have
any proceedings begun by CITY to enforce this Deed of Trust discontinued at any time prior to five
(5) days before the sale of the Property 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) Borrower pays CITY all sums which would be then due under this
Deed of Trust and the Note had no acceleration occurred;
(b) Borrower cures all breaches of any other covenants or agreements of
Borrower contained in this Deed of Trust;
(c) Borrower pays all reasonable expenses incurred by CITY and Trustee
in enforcing the covenants and agreements of Borrower continued in this Deed of
Trust and in enforcing Trustee's remedies as provided in paragraph 19 hereof, in-
cluding, but not limited to, reasonable attorneys' fees; and,
(d) Borrower takes such action as CITY may reasonably require to assure
that the lien of this Deed of Trust, CITY's interest in the Property and Borrower's
obligation to pay the sums secured by this Deed of Trust shall continue unimpaired.
Upon such payment and cure by Borrower, this Deed of Trust and the
obligations secured hereby shall remain in full force and effect as if no acceleration had occurred.
Page 9 of 13
435
21. Assi.onment of Rents~ Appointment of Receiver~ CITY in Possession. As
additional security hereunder, Borrower hereby assigns to CITY the rents of the Property,provided
that Borrower shall, prior to acceleration under paragraph 19 hereof or abandonment of the Property,
have the right to collect and retain such rents as they become due and payable.
Upon acceleration under paragraph 19 hereof or abandonment of the Property,
CITY, in person, by agent or by judicially appointed receiver shall be entitled to enter upon, take
possession of and manage the Property and to collect the rents of the Property including those past
due. All rents collected by CITY or the receiver shall be applied first to payment of the cost of
management of the Property and collection or rents, including, but not limited to, receiver's fees,
premiums on receiver's bonds and reasonable attorneys' fees, and then to the sums secured by this
Deed of Trust. CITY and the receiver shall be liable to account only for those rents actually
received.
22. Reconveyance. Upon payment of all sums secured by this Deed of Trust,
CITY shall request Trustee to reconvey the Property and will surrender this Deed of Trust and all
Notes evidencing indebtedness secured by this Deed of Trust to Trustee. Trustee shall reconvey the
Property without warranty and without charge to the person or persons legally entitled thereto. Such
person or persons shall pay all costs of recordation, if any.
23. Substitute Trustee. CITY, at CITY's option, may from time to time appoint a
successor trustee to any Trustee appointment hereunder by an instrument executed and acknowledged
by CITY and recorded in the office of the Recorder of the county where the Property is located. The
instrument shall contain the name of the original lender, Trustee and Borrower, the book and page
where this instrument is recorded, and the name and address of the successor trustee. The successor
trustee shall, without conveyance of the Property, succeed to all the title, power and duties conferred
upon the Trustee herein and by applicable law. This procedure for substitution of trustee shall govern
to the exclusion of all other provisions for substitution.
24. Request for Notices. Borrower requests that copies of the notice of sale be
sent to Borrower's address which is the Property Address.
25. Statement of Obligation. CITY may charge a fee not to exceed Sixty Dollars
($60.00) for furnishing the statement of obligation as provided by Section 2943 of the Civil Code of
California.
26. Deed of Trust Rider. The Deed of Trust Rider executed by Borrower is
attached hereto and made part of this Deed of Trust.
27. Covenants, Conditions and Restrictions. The Property is subject to
Covenants, Conditions and Restrictions ("Restrictions")between CITY and Borrower, which are not
attached hereto but are incorporated by reference. Borrower acknowledges receipt of said
Restrictions and agrees, for himself, his heirs, successors and assigns to be bound by the same.
/Encinitas/Deed.005 Page 10 of 13
436
28. Warranties of Borrower. Borrower warrants to CITY as follows:
(a) That Borrower's household annual gross income does not exceed eighty
percent (80%) of the median income for the San Diego metropolitan area, as adjusted
for family size, as said median income is determined by HUD, on the latter of:
(1) the date of initial occupancy of the Property; or,
(2) the date of the recordation of this Deed of Trust.
(b) Except as provided in Paragraph 16 of this Deed of Trust, for so long
as Borrower owns the Property, Borrower will reside in the Property as Borrower's
principal place of residence and will not to sublet, lease or rent out the Property during
the term of this Deed of Trust.
29. Foreclosure by Holder of Senior Deed of Trust. This Deed of Trust is
subordinate to any deed of trust or mortgage on the Property made by or held by an institutional
lender or investor. Any party, and its successors and assigns, receiving title to the Property through
a trustee's sale, a judicial foreclosure sale or deed in lieu of foreclosure of such deed of trust or
mortgage, and any conveyance or transfer thereafter, shall receive title free and clear of the
provisions of this Deed of Trust and any and all affordability restrictions.
REQUEST FOR NOTICE OF DEFAULT
AND FORECLOSURE UNDER SUPERIOR
MORTGAGES OR DEEDS OF TRUST
CITY will request that copies of notices of foreclosure from the holder of any lien
which has priority over this Deed of Trust be sent to CITY's address, as set forth on page 1 of this
Deed of Trust, as provided by Section 2924b of the Civil Code of California.
IN WITNESS WHEREOF, Borro' ~as executed this Deed of Trust.
Date: '1 !1~1~7 ~
~ Borrower
Norma P. F] ores
Date:
Borrower
/Encinitas/Deed.005 Page 11 of 13
437
ACKNOWLEDGMENT
State of California )
)
County of San Diego )
On ~xt. i $ ,1998, before m~ ~. Pa~~personally appeared, O
M ~ ~,. 'P. '~---- t.~ce~' pct~m~i~ ~luw, ~ ~,~ (or proved m me on ~e
basis of satisfacmu evidence) m ~ ~e person~) whose ~e¢) is/~e subscribed m ~e wi~
~ent "DEED OF TRUST" ~d ac~owledged to me ~at ~/she/~ey executed ~e sine ~
~/her/~ir au~or~ed capaci~(~), ~d mat by ~/her/~k sigmmre(~ on ~e ~ent ~e
~rson(~, or ~e enti~ on ~hflf of w~ch ~e person~ acted, executed ~e i~ent.
~TNESS my h~d ~d official seal. ~~~
~ ~CH 21. ~ ~
Sig mre . (Sea )
Page 12 of 13
438
REQUEST FOR RECONVEY~NCE
TO TRUSTEE:
The undersigned is the holder of the note or notes secured by this Deed of Trust. Said
note or notes, together with all other indebtedness secured by this Deed of Trust, have been paid in
full. You are hereby directed to cancel said note or notes and this Deed of Trust, which are delivered
hereby, and to reconvey, without warranty, all the estate now held by you under this Deed of Trust to
the person or persons legally entitled thereto.
Dated: By:
Page 13 of 13
439
DEED OF TRUST RIDER
THIS DEED OF TRUST RIDER (herein "Rider") is attached to and made a part of the
Deed of Trust dated November 13 , 1998 made between the CITY OF ENCINITAS, a municipal
corporation (herein "CITY") and executed by Nol~ P. F~OR~8 as Borrower.
Borrower agrees to the provisions of this Deed of Trust Rider in addition to those of
the Deed of Trust. THE LANGUAGE OF THIS RIDER PREVAH.S OVER THE DEED OF
TRUST IN THE EVENT OF A CONFLICT.
1. Borrower agrees that the Property being purchased is affordable as thereafter
described in the CITY's Affordable Housing Compliance Plan ("the Plan") dated August 14, 1996,
and that the continued use of the Property must be in accordance with the Plan and the Declaration of
Covenants, Conditions and Restrictions dated November 13 , 1998, and that no transfer of the
Property will be permitted and no successor-in-interest to the Borrower(s) will be permitted to assume
the loan of Borrower(s) evidenced by the Note secured by this Deed of Trust Rider, unless the written
consent of CITY to the transfer has been first obtained. No such consent will be given by CITY
except in the following limited circumstances:
(a) the transfer results from the death of a Borrower and the transfer is to
the surviving spouse of the Borrower and the surviving spouse is also a Borrower;
(b) a transfer by a Borrower to his or her spouse when the spouse becomes,
by such a transfer, a co-owner of the Property;
(c) a transfer of the Property resulting from a decree of dissolution of the
marriage or legal separation or from a property settlement agreement incidental to such
a decree which requires the Borrower to continue to make payments on the Note and
by which a spouse who is already a Borrower becomes the sole owner of the Property;
(d) a transfer by a Borrower to an inter vivos trust in which the Borrower is
the sole beneficiary; and/or,
a uansfer or rental in accordance with the ownership restrictions contained in
paragraphs 16, 17 and 18 of the Deed of Trust.
[remainder of page intentionally left blank]
/Encinita~D~l.005
440
2. This Deed of Trust is subordinate to any deed of trust or mortgage on the
Property made by or held by an institutional lender or investor. Any party, and its successors and
assigns, receiving title to the Property through a trnstee's sale, a judicial foreclosure sale or deed in
lieu of foreclosure of such prior deed of trust or mortgage, and any conveyance or transfer thereafter,
shall receive title free and clear of the provisions of this Deed of Trust and any and all affordability
restrictions.
NOTICE TO BORROWER:
Do not sign this Deed of Trust Rider if it contains blank spaces. All spaces should be
completed before you sign.
[ ' ' ~ Borrower
441
EXHIBIT "A" LEGAL DESCRIPTION
PAGE 1 OF 1
A CONDOMINIUM COMPRISED OF::
PARCEL A:
AN UNDIVIDED 1/18TH FEE SIMPLE INTEREST AS A TENANT IN COMMON IN AND TO THE PORTION OF THE
COMMON AREA OF MODULE D OF LOT 5 OF CITY OF ENCINITAS TRACT NO. 96-170, IN THE CITY OF
ENCINITAS, COUNTY OF SAN DIEGO, STATE OF CAEFORNIA, ACCORDING TO MAP THEREOF NO. 13481,
FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 9, 1997, AS SHOWN
ON THE CONDOMINIUM PLAN FOR SAXONY, PHASE 3, RECORDED IN THE OFFICE OF THE COUNTY
RECORDER OF SAN DIEGO COUNTY ON MARCH 17, 1998 AS FILE NO. 1998-0142314 ("CONDOMINIUM PLAN").
PARCEL B:
RESIDENTIAL UNIT NO. 22 AS SHOWN AND DEFINED ON THE CONDOMINIUM PLAN.
RESERVING THEREFROM NON-EXCLUSIVE EASEMENTS FOR MAINTENANCE, ENCROACHMENT, SUPPORT,
REPAIR, DRAINAGE AND ALL OTHER PURPOSES AS DESCRIBED IN THE DECLARATION.
PARCEL C:
A NON-EXCLUSIVE EASEMENT, IN COMMON WITH OTHER OWNERS, FOR INGRESS AND EGRESS, USE AND
ENJOYMENT, OVER, IN, TO, AND THROUGHOUT THE ASSOCIATION PROPERTY SHOWN ON THE
CONDOMINIUM PLAN REFERRED TO IN PARCEL "A" ABOVE AND OVER, IN, TO AND THROUGHOUT, OTHER
PHASES OF THE PROPERTY DESCRIBED IN THE DECARATION WHICH EASEMENT IS APPURTENANT TO THE
RESIDENTIAL UNIT DESCRIBED ABOVE. THIS EASEMENT SHALL BECOME EFFECTIVE AS TO EACH OF SAID
PHASES, RESPECTIVELY, UPON (1) RECORDATION OF A DECLARATION OF ANNEXATION, DECLARING SUCH
PHASES, RESPECTIVELY, TO BE SUBJECT TO THE DECLARATION, AND (11) CONVEYANCE OF THE FIRST
CONDOMINIUM IN EACHRESPECTIVE PHASE, AU. AS MORE FULLY SET FORTH IN THE DECLARATION. THE
ASSOCIATION PROPERTY REFERRED TO HEREIN AS TO EACH OF SUCH PHASES SHALL BE AS SHOWN AND
DESCRIBED ON THE CONDOMINIUM PLAN COVERING EACH SUCH PHASE RECORDED IN THE OFFICE OF
THE COUNTY RECORDER OF SAN DIEGO COUNTY, CAMFORNIA, EXCEPTING THEREFROM THE COMMON
AREA AND RESIDENTIAL UNITS THEREON.
PARCEL D:
AN EXCLUSIVE EASEMENT OVER THE PORTION OF THE ASSOCIATION PROPERTY (AS DEFINED IN THE
DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS FOR SAXONY AT ENCINITAS RANCH
RECORDED IN THE OFFICE RECORDS OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, CALIFORNIA
ON DECEMBER 2, 1997 AS INSTRUMENT NO. 1997-0608422, AND ANY AMENDMENTS THERETO) DESIGNATED
IN THE CONDOMINIUM PLAN OR IN ANOTHER CONDOMINIUM PLAN FOR ANOTHER PHASE OF THE SAXONY
AT ENCINITAS RANCH PROJECT AS AN EXCLUSIVE USE PARKING SPACE APPURTENANT TO THE
RESIDENTIAL UNIT DESCRIBED IN PARCEL 'B" ABOVE.
DE~CL'I'R-0g/08/94bk
NOTICE: This Note may require payment of principal and interest upon the sale or
transfer of the property or upon a prepayment
NOTE
November /.) ,1998 San Diego, California
434 Carmel Creeper Place, Encinitas, California 92024
1. Borrower's Promise to Pay. In return for a loan that I have received, I
promise to pay Twenty-Nine Thousand Eight Hundred Twenty-Eight U.S. Dollars ($29,828)
(herein "principal") to the order of the CITY OF ENCINITAS, a Municipal Corporation (herein
"Lender"). I understand that Lender may transfer this Note. Lender or anyone who takes this
Note by transfer and who is entitled to receive payments under this Note may be called "Note
Holder".
2. No Interest. This Note will bear no interest unless I default under the
terms of this Note, the Deed of Trust securing it and/or the Covenants, Conditions and
Restrictions affecting the Property. In the event of default, interest from the date of recordation
of the Deed of Trust securing this Note shall be calculated at the greater of the following
amounts:
(a) ten percent (10%) per annum; or,
(b) two points over the 1 lth District Federal Reserve Bank index.
Provided, however, if such rate would violate the usury laws of the
State of California, then the rate shall be at set forth in Paragraph
2(a) hereof.
3. Payments. I will make any payments at Lender's offices located at 505 S.
Vulcan Avenue, Encinitas, California 92024.
This Note is due and payable, including the principal and interest thereon, if any,
upon default by me, or when a Prohibited Transfer occurs as def'med in the Deed of Trust. This
Note will be forgiven on the date which is fifty-five (55) years after the recordation of the Deed
of Trust securing this Note, if the Borrower has not defaulted or made a Prohibited Transfer of
the Property, or any portion thereof.
4. This Note Secured by a Deed of Trust. In addition to the protection
given to Note Holder under this Note, a Deed of Trust dated the same day as this Note protects
Note Holder from possible losses which might result if I do not keep the promises which I make
in this Note. That Deed of Trust describes how and under what conditions I may be required to
make immediate payment in full of all amounts that I owe under this Note.
5. Borrower's Waiver. I waive my rights to require Note Holder to do
certain things. Those things are:
(a) to demand payment of amounts due (known as "presentment");
(b) to give notice that amounts due have not been paid (known as
"notice of dishonor"); and,
(c) to obtain any official certification of nonpayment (known as
"protest").
Anyone else who agrees to keep the promises made in this Note, or who agrees to
make payments to Note Holder if I fail to keep my promises under this Note, or who signs this
Note to transfer it to someone else also waives these rights. These persons are known as
"guarantors, sureties and endorsers".
6. Givinlt of Notices. Any notice that must be given to me under this Note
will be given by delivering it or by mailing it by certified mail addressed to me at the Property
Address above. A notice will be delivered or mailed to me at a different address if I give a
notice of that different address.
Any notice that must be given to the Note Holder under this Note will be given by
mailing it by certified mail to Note Holder at the address stated in paragraph 3 above. A notice
will be mailed to Note Holder at a different address if I am given a notice of that different
address.
[remainder of page intentionally left blank]
^:xNo~.~oc Page 2 of 8
7. Responsibility_ of Persons Under This Note. If more than one person
signs this Note, each of us is fully and personally obligated to pay the full amount owed and to
keep all promises made in this Note. Any guarantor, surety or endorser of this Note (as
described in paragraph 6 above) is also obligated to do these things. Note Holder may enforce
its rights under this Note against each of us individually or against all of us together. This means
that any one of us may be required to pay all of the amounts owed under this Note. Any person
who takes over my rights or obligations under this Note will have all of my rights and must keep
all of my promises made in this note. Any person who takes over the rights and obligations of a
guarantor, surety or endorser of this Note (as described in paragraph 6 above) is also obligated to
keep all of the promises made in this Note.
8. Attorneys' Fees. Upon the breach of the terms of this Note, the Deed of
Trust securing it, and/or the Covenants, Conditions and Restrictions encumbering the Property, I
agree to pay Lender any and all attorneys' fees, court costs, trustee fees, and any and all other
fees and costs incurred by Lender as a result of said breach and/or default.
NOTICE TO BORROWER:
Do not sign this Note if it contains blank spaces. All spaces should be completed
before you sign.
Note.The Note Rider executed by _t~rrower is attached hereto and made a part of this
Date: ' '/~-~/~}~ ~'
, Borrower
(SIGN ORIGINAL ONLY)
n:XNOTE.OOC Page 3 of 8
NOTE RIDER
THIS NOTE RIDER is attached to and made a part of the Note, dated November
I g 1998 made payable to the CITY OF ENCINITAS ("CITY") as Lender and executed
by Borrower.
1. Borrower agrees to the provisions of this Note Rider in addition to those
of the Note. THE LANGUAGE OF THIS RIDER PREVAILS OVER THE PROMISSORY
NOTE IN THE EVENT OF A CONFLICT.
2. Transfer, Conveyance of Property Restricted for Fifty Five (55} Years.
The sale, transfer and/or conveyance of the Property is restricted as follows:
If Borrower sells, transfers or conveys the Property less than fifty five
(55) years after the date of recordation of the Deed of Trust securing this Note Rider, then said
sale, conveyance and/or transfer shall be subject to the following:
(a) The Property may only be sold, transferred or conveyed to a
subsequent purchaser whose income is less than eighty percent
(80%) of the median income as defined by HUD from time to time
for the San Diego metropolitan area, as adjusted for family size,
and verified by CITY.
(b) Except as provided in Paragraph 2(d) hereof, the Property must be
used only as the principal residence of the subsequent purchaser
during the time of ownership.
(c) The sale price to the subsequent purchaser must be at a price that is
"affordable to the subsequent purchaser(s)". "Affordable to the
subsequent purchaser(s)" is achieved if the mOnthly payments for
principal, interest, property taxes, insurance and a utility allowance
do not exceed thirty percent (30%) of the gross income of a family
with an income that is eighty percent (80 %) of the median income
for the area, for a family of three.
///
///
Page 4 of 8
(d) In the event that a Transferor is unable to f'md, despite diligent
efforts to do so, an Eligible Person or Family to purchase a
Housing Unit, the Transferor may sell the Housing Unit to a
person other than an Eligible Person or Family by fu'st offering to
sell the Housing Unit to the CITY for a purchase price equal to
highest purchase price at which an Eligible Person or Family could
qualify to purchase the Housing Unit at an Affordable Housing
Cost. The CITY shall accept or reject the offer to sell the Housing
Unit to the CITY within thirty (30) days of the date of receipt of
the offer to sell. In the event that the CITY declines to purchase
the Housing Unit, the Transferor may proceed to market and sell
the Housing Unit to any purchaser without regard to the resale
conditions set forth in this Agreement; provided that upon or prior
to the close of escrow the Transferor shall pay to the CITY the
greater of: 1) the amount of the Second Deed of Trust, or 2)
"Equity Sharing Amount", hereinafter defined.
The "Equity Sharing Amount" means an amount equal to the appreciation
in the value of the Property determined by the difference between the
Sales Price and the Affordable Housing Price (as defined below).
The "Affordable Housing Price" is the purchase price that could be paid
by an Eligible Person or Family at an Affordable Housing Cost.
The "Sales Price" is the price to be paid by the buyer of the Property (the
"Buyer") to the Transferor for Transferor's interest in the Property,
exclusive of escrow fees, title insurance costs, broker's commissions, loan
fees or any other closing or transaction costs.
Upon a showing of hardship by the Transferor to the CITY in writing, the CITY may
waive any one or combination of the following: the resale restrictions, the Transferor's
obligation to sell to the CITY, the Transferor's obligation to pay the CITY the Equity Sharing
Amount and/or the Transferor's obligation to pay the CITY the amount of the Second Deed of
Trust.
(e) The affordability requirement shall remain in effect for a
total of fifty five (55) years, measured from the date of this
Deed of Trust. This requirement shall remain in full force
and effect against all subsequent purchasers during the
restricted term. This restriction shall also apply to sales of
the Property from the subsequent purchaser to other
purchaser(s) during the restricted term.
^:xNo~.r~c Page 5 of 8
(f) If the Borrower fails, refuses or is unable to convey, sell,
rent or transfer the Property to a person or persons meeting
the requirements of paragraphs 16, 17a through 17e,
inclusive, before the end of the affordability term as
defined in paragraph 17e, then such transfer shall be
deemed a Prohibited Transfer as def'med in Paragraph 18
hereof.
These provisions of paragraph 17 shall bind the heirs, successors and
assigns of the Borrower.
3. Prohibited Transfer. If Borrower sells, agrees to sell, conveys, rents
and/or transfers the Property in violation of the terms of Paragraph 2 hereof and Paragraphs 16
and 17 of the Second Deed of Trust, then CITY may, at its option, in addition to any and all
other remedies available to it, require immediate payment in full of all sums secured by the
Second Deed of Trust. In the instance of a prohibited transfer, the Transferor shall pay to the
CITY the greater of: 1) the amount of the Second Deed of Trust, including any interest, as
described in the Note, or 2) "Equity Sharing Amount", as defined above.
As an alternative, CITY may, at its option, purchase the Property for a
purchase price equal to the highest purchase price at which an Eligible Person or Family could
quality to purchase the Housing Unit at an Affordable Housing Cost. However, these options
shall not be exercised by CITY if such exercise is prohibited by federal law as of the date of the
Deed of Trust or if the CITY has executed a separate written waiver of these options.
If CITY exercises any of these options, CITY shall give Borrower Notice
of Acceleration or, in the alternative, Notice of Exercise of First Right of Refusal Option. The
notice shall provide a period of not less than thirty (30) days from the date that the notice is
delivered or mailed within which Borrower must pay all sums secured by the Deed of Trust or
must enter into an escrow to convey the Property to CITY, depending upon the option exercised
by CITY. If Borrower fails to pay these sums or enter into an escrow prior to the expiration of
this period, CITY may invoke any remedies permitted by the Deed of Trust without further
notice or demand on Borrower. The escrow contemplated by this Paragraph 3 must close not
more than ninety (90) days after CITY receives notice of such sale, agreement to sell,
conveyance, rental or transfer of the Property in violation hereof.
4. Warranties of Borrower. Borrower warrants to CITY as follows:
(a) Borrower's household annual gross income does not exceed eighty
percent (80%) of the median income for the San Diego metropolitan area, as
adjusted for family size, as said median income is determined by HUD, on the
latter of:
A:XNO~.~OC Page 6 of 8
(1) the date of occupancy of the Property; or,
(2) the date of the recordation of the Deed of Trust.
(b) Except as provided in Paragraph 16 of the Deed of Trust for so
long as Borrower owns the Property, Borrower will reside in the Property as
Borrower's principal place of residence and will not rent, lease or sublet the
Property during the term of the Declaration, i.e., fifty five (55) years.
NOTICE TO BORROWER:
Do not sign this Note Rider if it contains blank spaces. All spaces should be
completed before you sign. f
Date: ll]/ 5]q
N Flores, Borrower
(SIGN ORIGINAL ONLY)
A:XNO~.~OC Page 7 of 8
ACKNOWLEDGMENT
State of California )
)
County of San Diego )
On I'4~L i ~ ,1998, before me,d3aaB~ ~. 'Pac~.4e~ personally appeared,
~~ ~. ~~ perso~lly ~own to me (or proved to
me on ~e basis of satisfacto~ evidence) to be ~e person~ whose ~e~ is/~ subscri~d to
· e wi~ ~ment "NOTE" AND "NOTE ~DER" ~d ac~owledged m me ~at ~/she/~y
executed ~e s~e ~ ~/her/~ au~or~ed capaci~(i~), ~d ~at by ~/her/~ir sigmmre~
on ~e im~em ~e ~rson(~, or ~e enti~ on ~lf of w~ch ~e ~rson~ acted, execumd ~e
~ent.
~TNESS my h~d ~d offici~ seal. ~
Sigm~e ~. ~~~
(Seal)
Page 8 of 8