Changes to the Cape Coral City Ordinance – Zoning and land use changes

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Recently, the City of Cape Coral has made some zoning and land use changes. What it means and how it affects us is a serious issue! If you list a property in one of the affected areas and the buyer is not informed, you will most likely get in trouble! 
Here it is in a nut shell……
A while back the City made some future land use changes. The zoning in those areas was changed. Properties that are now residential (single family or duplex) in the areas they changed to commercial, retail,  or mixed use allowing retail and offices are now “non Conforming.”  
Ordinance 39-10 allows already built structures that are now non conforming to be considered conforming for as long as the CURRENT OWNER is in place. If they sell, the property becomes non conforming.
They have put the burden of conveying that on the current owner to inform a buyer which we know most will not have a clue, or choose to ignore it so you will have to look up the location of the property on the Future Land Use Map and make sure it is not in one of those areas, and let the owner know if it is and they must disclose it in the listing information which will pretty much kill the chances of a sale. Also a lender will not approve a loan on a property that is in a area where the zoning has been changed and would no longer be conforming. The map can also be viewed on the City’s web site, but is so small you really can’t determine anything.

Here is the full ordinance from the Cape Coral city received by email.

On Monday, August 9, the City Council approved Ordinance 39-10.  Below is a brief summary from the City Attorney’s Office.

Ordinance 39-10 amends the Land Use and Development Regulations (LUDR) to allow single-family and duplex dwellings that would become non-conforming due to an amendment to the City’s Comprehensive Plan to be treated as a conforming structure. This would be for as long as the owner who owned the property when the amendment was adopted continues to own the property upon which the dwelling is located. However, when the amendment is the result of a request by the property owner, this will not apply.

This situation usually occurs when the City initiates either a small-scale or large-scale future land use map amendment.  The result is these dwellings, as well as accessory structures, may be repaired, altered, enlarged, or replaced, as if they are conforming structures.  Should the owner of the dwelling at the time of the Comprehensive Plan Amendment subsequently convey, or transfer, ownership to another, then this exception terminates and the dwelling shall be subject to the limitations within section 2.6.2.a, b, and c, of the LUDR’s.  Prior to any conveyance or transfer, the property owner shall notify, in writing, the person or entity to whom the property is being transferred of the change in status of the dwelling.  However, the failure to provide this notice will not affect the change in status of the property (to a non-conforming structure).

If you have any questions, please contact the City Attorney’s office at (239) 574-0408.

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Comments (0) Aug 18 2010

Pro’s and con’s of the 203k FHA Rehabilitation Mortgage Program

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We all know that FHA home loans, which are insured by the Federal Housing Administration (FHA), are great financing options for any homeowner who are looking to buy a house or refinance his or her current mortgage.
These loans have low interest rates and usually only require down payments of 3.5 percent! FHA loan requirements are simple, so current and potential homeowners are more likely to qualify for these loans than other types of loans.
The one I had recently was a 203k Rehabilitation Mortgage. And honestly, I’m not to encourage anyone to follow that route!

FHA 203k Rehabilitation Mortgage Insurance Program

The FHA has a specific loan program to help homeowners who need to make improvements or repairs on their home, but do not have the funds to do so.
These loans are called FHA 203k loans and can be used for either a purchase or a refinance.
There are two types of loans in this program, one loan is for repairs that cost less than $30,000 and the other loan is for repairs that cost more than $30,000.
I had the first one since I had less than $11,000 of repairs needed and appliances replacement.

A streamline FHA 203k option is also available to homeowners who are interested in doing non-structural repairs or improvements.
This loan requires less documentation and can be less costly.
It allows a homeowner to finance up to an additional $35,000 into his or her mortgage in order to make improvements to the home.
An FHA home inspector or appraiser can identify home repairs that need to be made but that was not the case with mine.

How the Loan Can Be Used

Although there are some restrictions on what the loan can be used for, there are plenty of renovations and home repairs that the loan does cover.
In general, these include modernization, eliminating safety or health hazards, making a home more accessible for individuals with disabilities, or making a home more energy efficient.
More specifically, the loan can be used for roofing, plumbing, flooring, painting, minor remodeling and more.
However, something needs to be disclose is the time frame that the 203k process will need.
Even if I was pre-approved, 3 to 4 months were needed to close. We had 6 contract extension and I feel that if it wasn’t a forclosed home, the seller would have walked away from this deal.
But it doesn’t stop there. Once the works done, the process to release the remaining checks for contractors is so long that one of them recorded a lien on the property already.
And I can’t blame him, the job is done and he’s been paid 40% of his quote so far.
Plus, try to get in touch in a timely manner with a human regarding all those issues and you’ll understand why I will never go for a 203k anymore.
Of course, this lien issue will make the disbursement even slower!

Loan Requirements

There are certain requirements with this type of financing.
Homeowners must spend at least $5000 on their home repairs in order to be eligible.
Homeowners must get cost estimates from a licensed and insured contractor(s) before signing the sales contract.
The total cost of the mortgage, including the repairs, must remain within the FHA loan limits for the county in which the home is located.

This loan cannot be used to flip houses, and the homeowner must use the loan on the home in which he or she lives.
The work being done on the house must begin within 30 days of the loan closing.
All work must be completed within six months to comply with the loan requirements.

If a homeowner wants to do some repairs to his or her home and wants additional financing, this kind of financing could be the best option.
Many of the same eligibility standards used for standard FHA home loans apply to the FHA 203k loan.
Most lenders will require that the borrower have a credit score of at least 620 to be eligible.
To qualify for the mortgage, certain energy efficiency standards, as well as certain structural standards, must be met.

This loan could be great option for owners who need a better way to finance home repairs and improvements without depleting their savings if they are not afraid about the time frame needed to deal with it.

More about the 203k FHA Rehabilitation Mortgage Program can be found here

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Comments (1) Aug 03 2010

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