Section 37922.
Cal. Health and Safety Code - HSC § 37922.
in effectPrior to the issuance of any bonds or bond anticipation notes of the local agency for residential rehabilitation, the local agency shall by ordinance or resolution adopt a comprehensive residential rehabilitation financing program which shall include, but is not limited to, the following items:
(a)
Criteria for selection of residential rehabilitation areas by the local agency which shall include findings by the local agency that:
(1)
There are a substantial number of deteriorating structures in the area which do not conform to
community standards for decent, safe, sanitary housing.
(2)
Financial assistance from the local agency for residential rehabilitation is necessary to arrest the deterioration of the area.
(3)
Financing of residential rehabilitation in the area is economically feasible.
However, these findings are not required when the residential rehabilitation area is a redevelopment project area to which the provisions of the Community Redevelopment Law (Part 1 (commencing with Section 33000)) apply.
(b)
Procedures for selection of residential rehabilitation areas by the local agency which shall include:
(1)
Provisions for citizen participation in selection of residential rehabilitation areas.
(2)
Provisions for a public hearing by the governing body of the local agency prior to selection of any particular residential rehabilitation area by the local agency.
(c)
A commitment that, subject to budgeting and fiscal limitations of the local agency, rehabilitation standards will be enforced in 95 percent of the residences in each residential rehabilitation area.
(d)
Guidelines for financing rehabilitation of existing residences, which shall be subject to the following limitations:
(1)
Unless insured or guaranteed in whole or in part by an instrumentality of the United States or the State of California or by a person licensed to insure loans in this state, outstanding loans on the property to be rehabilitated, including the amount of the loans
for rehabilitation, shall not exceed 80 percent of the anticipated after-rehabilitation value of the property to be rehabilitated, except that the local agency may authorize loans, which are neither insured nor guaranteed, of up to 95 percent of the anticipated after-rehabilitation value of the property if such loans are made for the purpose of rehabilitating the property for residential purposes, there is demonstrated need for such higher limit, and there is a high probability that the value of the property will not be impaired during the term of the loan. Outstanding loans on property to be rehabilitated may be authorized up to 97 percent of the anticipated after-rehabilitation value of the property, if the person to whom the loan is made is of low income, as defined in Section 50093. A nonprofit corporation incorporated pursuant to Part 1 (commencing with Section 9000) of Division 2 of Title 1 of the Corporations Code or a cooperative housing corporation, as defined in subdivision (a) of Section 17265 of
the Revenue and Taxation Code, may be authorized a loan not exceeding either 98 or 100 percent of the estimated after-rehabilitation value or of its total development cost, according to the standards for nonprofit housing sponsors set forth in Section 50958, if the dwelling units within the residence rehabilitated with financing under this part are committed for the period during which the loan is outstanding for occupancy by persons or families who are eligible for financial assistance specifically provided by a governmental agency for the benefit of occupants of the residence.
(2)
The maximum repayment period for such residential rehabilitation loans shall be 40 years or four-fifths of the economic life of the structure, whichever is less.
(3)
Except as authorized in this paragraph, the maximum amount loaned for rehabilitation, exclusive of costs of acquisition, or exclusive
of refinancing, for each dwelling unit and for each commercial unit which is, or is part of, a “residence” within the meaning of that term as defined in this part, shall be forty-five thousand dollars ($45,000). Financing provided pursuant to this part by the redevelopment agency of a city and county may exceed such limitation with respect to loans for rehabilitation of one-to-four unit dwellings, provided the total amount financed, including any amount loaned for acquisition or refinancing, shall not exceed eighty thousand dollars ($80,000) per dwelling unit or 90 percent of the after-rehabilitation value specified in paragraph (1), whichever is less, regardless of whether the loan is or is not insured or guaranteed.
(4)
No more than 20 percent of any loan for such residential rehabilitation shall be used for residential rehabilitation which is not required under the local agency’s rehabilitation standards except that in the case of
owner-occupied one- to four-dwelling-unit properties, up to 40 percent of the loan for such residential rehabilitation may be used for residential rehabilitation not required under the local agency’s rehabilitation standards.
(5)
Except with respect to move-on residences, loans shall not be made for the purpose of refinancing the outstanding indebtedness of a participating party with respect to property which is subject to residential rehabilitation or for financing the acquisition of property which has been, or is to be, subject to residential rehabilitation, unless the cost, including in such costs any amounts previously expended for residential rehabilitation of that property by a participating party, within a residential rehabilitation area or a redevelopment project area established at the time of such expenditure, of meeting the rehabilitation standards is at least 20 percent of the principal amount of the loan.
(e)
Guidelines for financing residential infill construction within any residential rehabilitation area which is approved for such a program by the legislative body. The guidelines for residential infill construction shall be subject to the following limitations:
(1)
Unless insured or guaranteed in whole or in part by an instrumentality of the United States or the State of California or by a person licensed to insure loans in this state, outstanding loans on the property, including the amount of the loans for residential infill construction, shall not exceed 80 percent of the anticipated value of the property, following completion of the construction, except that the local agency may authorize loans, which are neither insured nor guaranteed, of up to 90 percent of the anticipated value of the property following completion of the construction, if such loans are made for the purpose
of constructing residences containing two or more dwelling units. A nonprofit corporation incorporated pursuant to Part 1 (commencing with Section 9000) of Division 2 of Title 1 of the Corporations Code or a cooperative housing corporation, as defined in subdivision (a) of Section 17265 of the Revenue and Taxation Code, may be authorized a loan not exceeding 100 percent of the estimated value of the property following completion of construction, if the dwelling units constructed with financing under this part are committed for the period during which the loan is outstanding for occupancy by persons or families who are eligible for financial assistance specifically provided by a governmental agency for the benefit of occupants of the residence.
(2)
The maximum repayment period for loans for residential infill construction shall be 40 years or four-fifths of the economic life of the structure, whichever is less.
(f)
Guidelines for financing the purchase of residences previously rehabilitated or constructed with financing under this part, if authorized by the legislative body, which shall be subject to the following limitations:
(1)
Purchasers of single-family dwellings eligible to receive such financing shall be persons or families of low or moderate income.
(2)
All rental dwelling units in the residence financed shall be committed for the period during which the loan is outstanding for occupancy by persons and families of low or moderate income, as defined by Section 50093. Upon recordation of the deed, other instrument of conveyance, lease, or instrument of financing in the office of the county recorder of the county in which the real property is located, the rental dwelling units reserved for occupancy by persons of low
income shall remain for such occupancy for not less than 30, nor more than 55, years. Such recorded agreement shall be binding upon successors in interest.
(3)
Unless insured or guaranteed in whole or in part by an instrumentality of the United States or the State of California or by a person licensed to insure loans in this state, outstanding loans on the property to be acquired shall not exceed 80 percent of the value of the property, except that the local agency may authorize loans, which are neither insured nor guaranteed, of up to 90 percent of the value of the property if such loans are made for the purpose of financing residences containing two or more dwelling units. A nonprofit corporation incorporated pursuant to, or otherwise made subject to the provisions of, Part 2 (commencing with Section 5110) of Division 2 of Title 1 of the Corporations Code or a cooperative housing corporation, as defined in subdivision (a) of Section 17265
of the Revenue and Taxation Code, may be authorized a loan not exceeding 100 percent of the value of the property, if the dwelling units within the residence are committed for the period during which the loan is outstanding for occupancy by persons or families who are eligible for financial assistance specifically provided by a governmental agency for the benefit of occupants of the residence.
(4)
The maximum repayment period for acquisition loans shall be 40 years or four-fifths of the economic life of the property, whichever is less.
(g)
No more than 35 percent of the aggregate principal amount of all loans made in a residential rehabilitation area may be for residential infill construction or acquisition financing.
(h)
A requirement that a plan for public improvements necessary to successful rehabilitation
of the residential rehabilitation area be developed, with citizen participation, for each residential rehabilitation area and that the plan for public improvements be adopted by the local agency prior to the financing of residential rehabilitation in any residential rehabilitation area, together with a commitment that, subject to budgetary and fiscal limitations, such plan will be carried out by the local agency.
References
referencesCal. Corporations Code - CORP § 9000.
referencesCal. Revenue and Taxation Code - RTC § 17265.
referencesCal. Corporations Code - CORP § 5110.
referencesCal. Health and Safety Code - HSC § 33000.
referencesCal. Health and Safety Code - HSC § 50093.
referencesCal. Health and Safety Code - HSC § 50958.
Source: CA Legislative Counsel Bulk DataURL: https://downloads.leginfo.legislature.ca.gov/pubinfo_2025.zipFetched: 6/27/2026