(a) An eligible applicant for a loan shall meet all of the following criteria:
(1) Have a household income at or below 120 percent of the statewide median household income or, for a small water system, serve households with a median household income at or below 120 percent of the statewide median household income.
(2) Have an ownership interest in the residence or small water system.
(3) Be unable to obtain financial assistance at reasonable terms and conditions from private lenders and lack the resources to undertake these improvements.
(4) Demonstrate an ability to repay the loan. This requirement may be satisfied by having another party join the application as a cosigner.
(b) Any loan provided shall be secured by appropriate collateral, which may include a mortgage on the residence and shall be repaid within 10 to 30 years in accordance with terms established by the state board. The interest rate on the loan shall not exceed 3 percent. Throughout the useful life of the improvement, a loan recipient shall furnish evidence of and continually maintain homeowner’s insurance on the security residence to protect the state’s interest in the residence.
(c) The county may enter into a contract with a private financial institution to provide loans consistent with the purposes of this chapter.
(Added by Stats. 2017, Ch. 438, Sec. 1. (AB 277) Effective January 1, 2018.)