Today's Law As Amended


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AB-1423 Housing programs: multifamily housing programs: expenditure of loan proceeds.(2021-2022)



As Amends the Law Today


SECTION 1.

 Section 50406.9 is added to the Health and Safety Code, to read:

50406.9.
 (a) Notwithstanding any other law, any funds approved, reserved, or allocated by the department for purposes of providing a loan under any multifamily housing program under this part may, at the option of the borrower, be used for any of the following purposes:
(1) Construction financing.
(2) Permanent financing.
(3) A portion for construction financing, with the balance used for permanent financing.
(b) If a borrower of funds as described in subdivision (a) requests the use of funds for construction financing pursuant to this section, the department shall deposit those funds with the first lender at or before the closing of the first lender’s construction loan. The first lender shall disburse the construction funds to the borrower at a rate of 75 percent of department funds to 25 percent of first lender funds during the construction period until the department funds are fully disbursed. Once the department funds are fully disbursed, the first lender shall disburse the balance of the first lender’s construction loan funds.
(c) This section shall not be construed to limit the eligible uses of funds otherwise authorized under any program provided under this part.