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In the event the bank disapproves the loan application, the <br />loan application package will be returned to the CDC along <br />with an~ appraisals, title and credit reports used by the bank <br />in reviewing the loan package. The CDC retains the right to <br />approve the loan using CDC funds. <br /> <br />The CDC warrants that the bank will be held harmless from any <br />acts of CDC employees, in the course of the loan process, that <br />may be in violation of State and/or Federal credit granting <br />statutes and regulations. The bank also warrants that the CDC <br />will be held harmless from any acts of bank employees, in the <br />course of the loan process, that may be in violation of State <br />and/or Federal credit granting statutes and regulations. <br /> <br />Loan Documentation & Disbursement <br /> <br />After the loan is approved by the bank, the bank will <br />prepare and forward loan documentation at the interest <br />rate previously determined and advise the CDC of the <br />Compensation Balance required. Payments on the loan shall <br />be equal monthly installments. <br /> <br />The CDC will obtain the borrower's signature on loan <br />documentation, mortgage documents, arrange for notarial <br />acknowledgements and return all documents to bank. <br /> <br />The bank may require the borrower to secure all loans with <br />a mortgage on the dwelling or other security with approval <br />of the CDC. <br /> <br />The CDC will obtain a dated and signed rehabilitation <br />contract. The contract must specify the type of <br />improvements and the itemized cost of those improvements. <br />The CDC will forward a copy of the executed contract to <br />the bank. <br /> <br />The CDC will issue a check in the amount of Compensating <br />Balance specified by the bank to be deposited in the <br />Compensating Balance Fund. CDC draws down that sum from <br />its lump sum drawdown. <br /> <br />D. Progress/Completion <br /> <br />1. CDC makes a periodic and final inspection. <br /> <br />2. CDC executes the completion certification. <br /> <br />a) <br /> <br />Upon receipt of an owner's satisfaction statement <br />signed by the homeowner and CDC, the CDC will inform <br />the bank when a final payment is due the contractor. <br />The bank will prepare and transmit said payment from <br />its loan escrow account to the contractor. <br /> <br />b) <br /> <br />The completion certificate shall be accompanied by the <br />necessary lien releases from contractors. <br /> <br /> <br />