IC 36-7-16
    Chapter 16. Home Rehabilitation Loans

IC 36-7-16-1
Application of chapter
    Sec. 1. This chapter applies to all units except townships.
As added by Acts 1981, P.L.309, SEC.35.

IC 36-7-16-2
Definitions
    Sec. 2. As used in this chapter:
    "Agency" refers to the department of metropolitan developmentin a county having a consolidated city, the works board in secondclass cities, and the department of redevelopment in other units.
    "Home" means a residential building containing no more than four(4) family dwelling units.
As added by Acts 1981, P.L.309, SEC.35.

IC 36-7-16-3
Appropriations; federal monies and monies received on resale ofproperty; grants to homeowners
    Sec. 3. (a) A unit having an agency may appropriate money to theagency for the purpose of making rehabilitation loans andadministering this chapter.
    (b) The unit, through its agency, may use federal monies that itreceives for these purposes and monies that it receives as a result ofthe sale or lease of property to which it has held title as a result offailure to comply with the terms of a loan or grant made under thischapter.
    (c) A unit, through its agency, may make home rehabilitationgrants to bona fide homeowners, if the monies used for these grantsare received only from federal grants and are appropriated under theterms and regulations of the granting federal entity. Federal grantsthat may be used under this subsection include monies appropriatedto units under the 1974 Community Development Act, as amended(42 U.S.C. sections 5301-5318).
As added by Acts 1981, P.L.309, SEC.35.

IC 36-7-16-4
"Concentrated code delinquency area" defined; loans;authorization; prerequisites
    Sec. 4. (a) As used in this section, "concentrated code delinquencyarea" means an area of at least one-half (1/2) square block in which:
        (1) at least two-thirds (2/3) of the lots are occupied byimprovements;
        (2) at least two-thirds (2/3) of the improvements are homes; and
        (3) an investigation by the agency shows that at least one-half(1/2) of the homes are not in compliance with applicablebuilding code standards.
The agency may conduct an investigation on its own initiative, and

shall conduct an investigation on receipt of a petition signed by theoccupants of at least one-half (1/2) of the family dwelling unitswithin the proposed area. In conducting the investigation, the agencymay use its own staff or hire independent appraisers and inspectors.
    (b) Rehabilitation loans may be made to enable the borrower tomake repairs that will bring his home into compliance withapplicable building code standards, if all of the following conditionsare present:
        (1) The borrower holds marketable title to the property, subjectonly to mortgage indebtedness or contract for the purchase ofthe property, the lien of taxes that are not yet due and payable,and any assessment for public improvements that is not yet dueand payable.
        (2) The property is located within the area of a communitydevelopment target area designated by an application to theDepartment of Housing and Urban Development under the 1974Community Development Act, as amended (42 U.S.C. sections5301-5318), an urban renewal project, a concentrated codedelinquency neighborhood, or an area needing redevelopment.
        (3) The agency has determined that the borrower is anacceptable credit risk. In making this determination, the agencyshall be guided by the fact that a principal purpose of thischapter is to make rehabilitation available to those who wouldbe unable to obtain such loans through normal commercialchannels.
        (4) The borrower has in full force and effect a policy ofinsurance protecting the property in an amount and with aninsurer satisfactory to the agency.
    (c) Subject to subsection (d), the agency shall use the proceduresprescribed by IC 36-7-14-15 through IC 36-7-14-18 to make a findingthat an area is an area needing redevelopment.
    (d) The agency in a consolidated city shall use the proceduresprescribed by law to make a finding that an area is an area needingredevelopment.
As added by Acts 1981, P.L.309, SEC.35. Amended by Acts 1981,P.L.310, SEC.92; P.L.185-2005, SEC.49.

IC 36-7-16-5
Purchasers under land sales contracts; eligibility for loans
    Sec. 5. (a) A purchaser under a land sales contract is eligible fora loan to cover the costs of repairs that will bring his home intocompliance with applicable building code standards, if all of thefollowing conditions are present:
        (1) The contract is a written, legally binding instrumentinvolving a residential property containing, after rehabilitation,not more than four (4) dwelling units.
        (2) The seller of the property holds fee title to the property, and,while the contract is in good standing, is unable to use theproperty for collateral or to convey it to any other party, unlessthe use for collateral or conveyance of fee is subject to the land

sales contract. The agency shall record this agreement, or thecontract, promptly after loan settlement.
        (3) Under the contract, the seller and any subsequent holder ofthe fee to the property is obligated, without qualification, todeliver to the purchaser fee simple title and a deed to theproperty upon full payment of the contract price, or some lesseramount.
        (4) Under the contract, the purchaser has:
        (A) full use, possession, and quiet enjoyment of the property;
        (B) equitable title to the property; and
        (C) full rights of redemption for a period of not less than ninety(90) days.
        (5) The purchaser has had possession and use of the propertyunder the contract for at least twelve (12) months before thedate of application for a loan. If the loan is to include an amountto refinance the balance due under a land sales contract, thisrequirement does not apply.
    (b) The agency may purchase the property from the contract sellerat any time by the exercise of any right of accelerated payment thatis provided for under the contract, by negotiation with the contractseller, or by the exercise of the power of eminent domain.
As added by Acts 1981, P.L.309, SEC.35.

IC 36-7-16-6
Property acquired by default; disposition
    Sec. 6. If the agency acquires title to property as the result of afailure to comply with the terms of a loan made under this chapter,the agency may make the same use or disposition of the property thatit may make of any other property to which it acquires title.
As added by Acts 1981, P.L.309, SEC.35.

IC 36-7-16-7
Loans; no application fee; closing costs and charges
    Sec. 7. The agency may not charge an application fee inconnection with the loans authorized by this chapter. However, if anapplication is approved, the agency shall include in the principalamount of the loan an amount sufficient to cover closing costs andthe cost of:
        (1) bringing the title to date;
        (2) obtaining title insurance or a title opinion from counsel;
        (3) appraisal; and
        (4) any necessary permits.
As added by Acts 1981, P.L.309, SEC.35.

IC 36-7-16-8
Loan rates; administration of chapter
    Sec. 8. (a) Loans made under this chapter shall be made at ratesto be determined by the agency. The proceeds of loans shall be usedto defray the expense of administering this chapter.
    (b) The agency may employ the persons and establish the

administrative guidelines required to carry out the purposes of thischapter.
As added by Acts 1981, P.L.309, SEC.35.