Information for Lenders and Escrow Officers

SUBORDINATION REQUESTS on Mayor's Office of Housing and Community Development (MOHCD) Units:

MOHCD only accepts subordination requests originated from Approved Lending Officers.

Thank you for your interest in working with the Mayor's Office of Housing and Community Development (MOHCD). Much of the information regarding refinance, payoff, workshop and fees can be found on this page. You may also want to visit our Homebuyer page for more detailed information on individual loan programs we offer to assist prospective homebuyers.

What is Needed for Subordination Requests:

• We only accept subordination request packages originated from Approved Lending Officers, except for Rehab loans or LEAD grants. For brokers, the funding lender also needs to be approved. We will decline a subordination request if the lending officer is not on our Approved Lending Officer List.
• Escrow submit all the required loan documents on the "Subordination Document Checklist" BY MAIL.
  The checklist can be downloaded HERE.
• Escrow prepares Subordination Agreement. A Microsoft Word template of the Subordination Agreement can be downloaded below for editing.
• Escrow includes a copy of the RECORDED City Loan Trust Deed.
• Escrow fills out the Subordination Document Checklist, and attach it as the cover page.

(Please note forms will be updated on June 28, 2013 reflecting changes effective July 1st, 2013)

• A non-refundable $522 "Program Administration Fee", in either cashier or escrow check. We do not accept personal checks.

Here are links to subordination request items in general:

• MOHCD Subordination Document Checklist, and Policy Guidelines (updated January 2013)
• Current "Approved Lending Officers" List
• "Subordination Agreement" Template for MOHCD loans, in Word format
• Frequently Asked Questions on Subordination Requests (updated April 2012)

Please note that:

• Due to the large volume of requests we are receiving, current processing time for subordination requests is 3 weeks.  We cannot begin processing an application until we receive all required documents.  The request is then processed in order by date of complete application.
• MOHCD will consider subordination approval if the refinance terms follow our MOHCD Subordination Guidelines, which is found on the second page of our Document Checklist. We only allow fixed-rate refinances. Other factors we'll consider include rate reduction, better loan terms (within loan program limits), and no cash equity withdrawal (unless allowed by specific loan programs) from the property. We will not consider moving the MOH/SFRA lien to a lower loan position in a refinance.
• Borrowers with CalHOME or BEGIN loans can ONLY refinance with a 30-year fixed-rate terms, due to Program restrictions.
• Starting April 1, 2009, refinancing borrowers for DALP, City 2nd, BMR, PIC and TND programs must work with one of our Approved Lending Officers. Starting July 01, 2012, refinancing former-SFRA borrowers must also work with one of our Approved Lending Officers, for us to consider approval.
• Starting July 1, 2013, Mayor's Office of Housing and Community Development is implementing an increase in Program Administration Fees
  The fee to process a subordination request is $522 (Please note forms will be updated on June 28, 2013 reflecting changes effective July 1st, 2013) The non-refundable cashier's check should be made payable to City and County of San Francisco.
• Starting April 16, 2012, MOHCD accepted subordination requests on former SFRA units.
• For details regarding specific City loan, please refer to their corresponding Loan Information webpage. They are listed under "Assistance for First-Time Homebuyers".
• Regarding Home Equity Line of Credit (HELOC):
  MOHCD does not allow Home Equity Line of Credit (HELOC). This policy is in place to protect homeowners with MOHCD loans/liens. HELOCs typically involve variable interest rate rather than fixed rate. A variable interest rate loan financing is not allowed by MOHCD.
• Regarding "Home Equity Loan" on BMR units:
  Owners of Below-Market Rate (BMR) units adminstered by MOHCD must contact MOHCD and receive approval, before applying for a home equity loan. The BMR homeowner must attend a Post-Purchase Counseling class from a participating HUD-approved non-profit housing counseling agency prior to applying for such a loan. MOHCD may consider home equity loan requests for the following reasons: to finance major expenses such as home repairs, medical bills or education. All other MOHCD underwriting guidelines must be met, including debt-to-income and loan-to-value ratios.

  A home equity loan is a type of loan in which the borrower uses the equity in their home as collateral. A home equity loan creates a lien against the borrower's house, and reduces actual home equity.

MOHCD LOAN PAYOFF

MOHCD Loans can be paid off before the loan term ends. To request a payoff, please provide us with the following:

1. A WRITTEN Payoff Request from borrower(s), or a signed consent from borrower(s).
2. A Current Apprasial Report (prepared within the past 90 days), if the City loan belongs to the DALP or City 2nd Programs. Appraisal is NOT needed for City Rehab loans/liens, such as LEAD, CHRP, and CalHOME.

Please notice that the BMR lien CANNOT be paid off. In addition, certain City restrictions may still apply after the City loan is paid off. For example, the "Right of First Refusal" requirement will remain on City 2nd properties after payoff. Please refer to specific MOHCD Programs for details.

WORKSHOPS & LENDER TRAININGS

Mortgage Loan Officers (MLO) or mortgage brokers who would like to become a participating lender for MOH's homeownership programs, including DALP, MCC, PIC and TND must attend and complete the required training and pay the required fee. Each individual MLO or mortgage broker must complete the training every year. All participating loan agents must must provide their NMLS ID# to MOHCD and sign the Lender Participation Agreement.

BMR Lender Training is not currently available. Lenders who wish to participate with the BMR must agree and understand that the City will place a second lien against the BMR property, which is the difference between the fair market value and the BMR sales price, referred to as BMR lien. The City will require Title Insurance for the BMR lien. The lender also understands that the restrictions in a Inclusionary Housing BMR unit will survive foreclosure. To inquire about BMR lender participation, please contact our office at (415) 701-5500 and ask for the BMR program staff.

Lender Training for DALP & MCC is now online. To register and take the training, please visit:
Online Lender Training for DALP & MCC 

APPROVED LENDING OFFICER LIST

Borrowers need to work with one of our "Approved Lending Officers" before we'll start our subordination review process. The approved list is at:
BMR/DALP/MCC Approved Lending Officer List

SAMPLE CITY LOAN DOCUMENTS

• Sample DALP Note
• Sample DALP Deed
• Sample BMR Loan Docs (pdf)
• BMR Lender Closing Checklist (Word)
• BMR Lending Guidelines (pdf)

ACH PAYMODE FOR ELECTRONIC FUNDS TRANSFER

The Mayor’s Office of Housing and Community Development (MOHCD) requires that all beneficiaries, vendors or Title Companies register for ACH paymode for Electronic Funds Transfer. This is standard for all of our funding transactions.

For information and to enroll to the ACH paymode system, please visit the San Francisco Controller’s Office website.

PROGRAM ADMINISTRATION FEES

Please be advised that the Mayor's Office of Housing and Community Development is Implementing an increase to the following program administration fees effective 7/1/2013, as shown below.