(a) All open-end mortgages, in order to have the priority provided in § 47-28-103, must contain the following:
Terms Used In Tennessee Code 47-28-104
Credit limit: means the maximum amount of principal indebtedness which may be outstanding at any one time under a revolving credit agreement. See Tennessee Code 47-28-101
Creditor: includes a state or national bank, a state or federal savings and loan association, a savings bank, a registrant under the Industrial Loan and Thrift Companies Act, compiled in title 45, chapter 5, a state or federal credit union, or any other individual, partnership, trust, corporation, or other legal entity permitted or authorized to enter into credit transactions secured by a mortgage. See Tennessee Code 47-28-101
Mortgage: includes a mortgage, deed of trust, or other conveyance of real property securing obligations, except instruments creating or perfecting a security interest in fixtures which do not include other real property. See Tennessee Code 47-28-101
Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
Open-end credit: A credit agreement (typically a credit card) that allows a customer to borrow against a preapproved credit line when purchasing goods and services. The borrower is only billed for the amount that is actually borrowed plus any interest due. (Also called a charge account or revolving credit.) Source: OCC
Open-end credit agreement: means a revolving credit agreement that is secured by a mortgage and that is not entered into for commercial purposes. See Tennessee Code 47-28-101
(1) A statement or other notice conspicuously identifying the mortgage as an open-end mortgage;(2) A provision fixing a stated term for the duration of the open-end credit agreement, which term and any extension thereof made pursuant to the provisions of the mortgage shall not exceed a total of thirty (30) years from the date of the original execution thereof;(3) A provision fixing a maximum limit on the total amount of principal indebtedness to be secured by the mortgage at any time, i.e., the credit limit, which limit shall include precomputed interest and other precomputed charges validly included in such principal amount, but shall not include other interest, loan charges, commitment fees, brokerage commissions, and other charges validly made pursuant to the mortgage, including but not limited to, those made or incurred in protecting the efficacy of the security, including, without limitation, payment of taxes or insurance premiums, or expenses incurred in the collection of the debt or the enforcement of the mortgage;(4) A conspicuous notice to the borrower of the borrower’s right pursuant to this chapter to reduce the limit on the maximum amount of total principal indebtedness to be secured under the mortgage, but the inclusion of such notice in an open-end credit agreement separate from the mortgage shall be deemed compliance with this subdivision (a)(4); and(5) A provision, either in the mortgage or in the open-end credit agreement, governing the duty of the borrower to return checks, credit cards, or other devices to obtain further advances on the service by the borrower of a notice of limitation, upon notice from the creditor pursuant to the terms of the open-end credit agreement.(b) All mortgages securing future advances which may be obligatory and which are for commercial purposes, in order to have the priority provided in § 47-28-103, must contain a statement or other notice identifying the mortgage as securing obligatory advances and as being for commercial purposes.
