A reverse mortgage loan contract may provide for a borrower’s default, thereby triggering early repayment of the loan, based only upon one or more of the following terms and conditions:

(1) The borrower fails to maintain the residence as required by the contract.

Terms Used In North Carolina General Statutes 53-267

  • Contract: A legal written agreement that becomes binding when signed.
  • following: when used by way of reference to any section of a statute, shall be construed to mean the section next preceding or next following that in which such reference is made; unless when some other section is expressly designated in such reference. See North Carolina General Statutes 12-3
  • Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
  • property: shall include all property, both real and personal. See North Carolina General Statutes 12-3

(2) The borrower sells or otherwise conveys title to the home to a third party.

(3) The borrower dies and the home is not the principal residence of the surviving borrower.

(4) The home is not the principal residence of at least one of the borrowers for a period of 12 consecutive months for reasons of physical or mental illness.

(5) For reasons other than physical or mental illness, the home ceases to be the principal residence of the borrower for a period of 180 consecutive days and is not the principal residence of another borrower under the loan, without prior written permission from the lender.

(6) The borrower fails to pay property taxes, insurance premiums, and assessments under N.C. Gen. Stat. § 53-261 (1991, c. 546, s. 1; 1995, c. 115, s. 1.)

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