Application process; deed to qualified buyer.

(1) A qualified buyer may apply to a local government or its designee to acquire single-family housing property. The application must be in a form and in a manner provided by the local government or its designee. If the application is approved, the qualified buyer and the local government or its designee shall enter into a homestead agreement for the single-family housing property. The local government or its designee may add additional terms and conditions to the homestead agreement.

(2) The local government or its designee shall deed or cause to be deeded the single-family housing property to the qualified buyer for $1 if the qualified buyer:

(a) Is in compliance with the terms of the homestead agreement for at least 5 years or has resided in the single-family housing property before the local government or its designee adopts the urban homesteading program;

(b) Resides in that property for at least 5 years;

(c) Meets the criteria in the homestead agreement; and

(d) Has otherwise promptly met his or her financial obligations with the local government or its designee.

However, if the local government or its designee has received federal funds for which bonds or notes were issued and those bonds or notes are outstanding for the housing project where the single-family housing property is located, the local government or its designee shall deed the property to the qualified buyer only upon payment of the pro rata share of the bonded debt on that specific property by the qualified buyer. The local government or its designee shall obtain the appropriate releases from the holders of the bonds or notes.