Reverse mortgage lenders are prohibited from engaging in any of the following acts in connection with the making, servicing, or collecting of a reverse mortgage loan:

(1) Misrepresenting material facts, making false promises, or engaging in a course of misrepresentation through agents or otherwise;

Terms Used In Tennessee Code 47-30-115

  • Borrower: means a natural person who occupies and owns in fee simple individually, or with another borrower as tenants by the entireties or as joint tenants with right of survivorship, an interest in residential real property securing a reverse mortgage loan, and who borrows money under a reverse mortgage loan. See Tennessee Code 47-30-102
  • Contract: A legal written agreement that becomes binding when signed.
  • Counselor: means either:
    (A) An individual who has completed a training curriculum on reverse mortgage counseling provided or approved by HUD and whose name is maintained on HUD's list of approved reverse mortgage counselors. See Tennessee Code 47-30-102
  • Fannie Mae: means The Federal National Mortgage Association, a corporation organized and existing under the laws of the United States. See Tennessee Code 47-30-102
  • Fraud: Intentional deception resulting in injury to another.
  • Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
  • Mortgage loan: A loan made by a lender to a borrower for the financing of real property. Source: OCC
  • Person: includes a corporation, firm, company or association. See Tennessee Code 1-3-105
  • Reverse mortgage: means a mortgage or deed of trust securing a home equity conversion loan or reverse mortgage loan. See Tennessee Code 47-30-102
  • Reverse mortgage loan: means a home equity conversion mortgage loan issued under the terms of this chapter. See Tennessee Code 47-30-102
  • Shared appreciation: means an agreement by the lender and the borrower that, in addition to any interest accruing on the outstanding balance of a reverse mortgage loan, the lender may collect an additional amount equal to a percentage of any net appreciated value of the property during the term of the reverse mortgage loan. See Tennessee Code 47-30-102
  • written: includes printing, typewriting, engraving, lithography, and any other mode of representing words and letters. See Tennessee Code 1-3-105
(2) Failing to disburse funds in accordance with the terms of the reverse mortgage loan contract or other written commitment;
(3) Improperly refusing to issue a release of a mortgage;
(4) Engaging in any action or practice that is unfair or deceptive, or that operates a fraud on any person;
(5) Contracting for or receiving shared appreciation, except that this subdivision (5) shall not apply to any Fannie Mae Reverse Mortgage Loan;
(6) Closing a reverse mortgage loan without receiving certification from a counselor that the borrower has received counseling on the advisability of a reverse mortgage loan and the appropriate reverse mortgage loan for the borrower; or
(7) Failing to comply with this chapter.
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