NORWICH – At Tuesday night’s meeting of the City of Norwich Common Council, a resolution was on the agenda authorizing the city to enter into a mortgage profit sharing agreement in relation to three of their economic development loans. The council seemed split on the issue, and not everyone was happy with the results.
The resolution was passed in regards to three economic development loans the city had given to different individuals. “The city has these economic development loans already. Three individuals are looking at re-consolidating these loans,” explained William Roberts, the director of finance. According to Roberts, the individuals are looking at a traditional re-consolidation from a bank or loaning institution. He explained these individuals would have a lesser chance of receiving the re-consolidation loan if the bank only had the security of a second mortgage.
The resolution would allow the city to share the first mortgage priority with the bank. The bank would have a 90 percent priority, and the city would have a 10 percent priority.
“It only affects the security interest. The amount outstanding is still the same,” Roberts explained at a later date.
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