Section 7574 - Resale and Loan Assumption(a) The owner of an assisted unit shall notify the Department prior to the sale, transfer or conveyance of the assisted unit or any interest therein.(b) The sale, transfer, or conveyance of an assisted unit or interest therein is subject to the following conditions: (1) If the sale or transfer is to a low-income household, the purchaser may assume the deferred payment loan upon completion of terms and conditions set forth in Sections 7572 and 7574(c).(2) If the sale, transfer, or conveyance is not to a low-income household, the deferred payment loan and accrued interest shall be due and payable upon the sale, transfer, or conveyance pursuant to Section 7572.(3) If, at time of resale, the market value of the housing unit is less than the sum of the outstanding balances on permitted mortgages and permitted liens, plus the value of sweat equity, then the amount of mortgage assistance due in repayment, or available for assumption, shall be reduced by the difference between the market value of the housing unit and said sum. The Department shall establish a value for the sweat equity based on information submitted by the grantee and shall determine the fair market value at the time of the proposed resale.(c) A low-income household seeking to assume the deferred payment loan shall:(1) Apply to the Department on an approved form;(2) Provide the Department with complete and accurate information as to income and estimated housing costs; and(3) Execute a new Deferred Payment Loan Agreement for the principal balance remaining on the loan.Cal. Code Regs. Tit. 25, § 7574
Note: Authority cited: Section 50697(d), Health and Safety Code. Reference: Section 50696, Health and Safety Code.