Fillable Rehabilitation Loan Agreement Template (Page 3 of 4) in pdf

12) Changes in the Homeowner/ Contractor Agreement must be approved by the “LENDER” in

writing prior to the beginning any Work. Changes may be requested by writing a letter describing

the changes or using form HUD-92577 (a “Request for Acceptance of Changes”). The Request for

Acceptance of Changes may be hand delivered, mailed or emailed to

or faxed to 866 -797-3137. If you have any questions, please call

800-624-0501.

13) Borrower shall cause all improvements to be made in a workmanlike manner and in accordance

with all applicable statutes and regulations. All licenses, permits and privileges required by local

governmental authorities to rehabilitate the Property shall be obtained by the Borrower(s) or

his/her Contractor and submitted to the “LENDER” prior to closing.

14) Representatives of the “LENDER” and or the Commissioner shall have the right to enter upon the

Property at all times during the period of construction and on completion of construction to

determine whether the Work conforms with this Agreement and the Homeowner/ Contractor

Agreement, and any approved changes to the foregoing, and to determine the amount of

Escrow Funds to be released by the “LENDER”.

15) Borrower will furnish such records, contracts, bills and other documents relating to the Property

and the improvements as the “LENDER” or the Commissioner may require.

16) Without prior, written consent of the “LENDER”, no materials, equipment, fixtures or any part of

improvements financed with this loan will be purchased or installed subject to conditional sales

contracts, security agreements, lease agreements or other arrangements whereby title is retained

or the right is reserved or accrues to anyone to remove or repossess any item, or to consider it as

personal property.

17) The Borrower shall cause either this instrument or the Homeowner/ Contractor Agreement under

which the improvements are to be made to be filed in the public records, if the effect of

recording will be to relieve the mortgaged property from mechanics’ and materialmen’s liens.

Before any release of Escrowed Funds under this Agreement, the “LENDER” may require the

Borrower to obtain acknowledgment of payment and releases of lien from the Contractor and all

subcontractors and materialmen dealing directly or indirectly with the Contractor (“Lien

Release”). These Lien Releases will cover the period through and including the date covered by

the last advance, and concurrently with the final payment for the entire project. Such Lien

Release must be in the form required by local or state lien laws and must cover all work done,

labor performed and materials (including equipment and fixtures) furnished for the project.

18) Borrower shall cause the Work to begin as soon as practicable after closing but in any event not

later than thirty (30) days following the date of this Agreement and completed with one hundred

eighty (180) days of the date of this Agreement. The Work shall be performed with reasonable

diligence; therefore, the Work is never to cease for more than 30 consecutive days. Should

Borrower fail to comply with these terms, the “LENDER” may refuse to make any further payments

under this Agreement. Any funds remaining in the Escrow Funds account shall then be applied as

prepayment to a principal reduction of the Note.

19) In the event any Stop Work Notices, Notices to Withhold, Mechanic’s Liens or other claims of lien

are filed against the Property, the “LENDER”, after five (5) days’ notice to the undersigned of its

intention to do so, may, in its sole discretion, pay any or all of such liens or claims, may contest the

validity of any of them, paying all costs and expenses of contesting same and/or may cease

making payments hereunder and make a principal reduction payment with the Escrow Funds. If

Rehabilitation Loan Agreement / FHA STANDARD 203(k) /Rev. 11/24/2015

Page 3 of 4

Rehabilitation Loan Agreement Template Page 3

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