State Codes and Statutes

State Codes and Statutes

Statutes > North-carolina > Chapter_53 > GS_53-257

§ 53‑257.  Definitions.

The following definitionsapply in this Article:

(1)        Authorized lender orlender. – The North Carolina Housing Finance Agency, any lender authorized toengage in business as a bank, savings institution, or credit union under thelaws of this State or of the United States, or any other person, firm, orcorporation authorized to make reverse mortgage loans by the Commissioner ofBanks.

(2)        Borrower. – Anatural person 62 years of age or older who occupies and owns, in fee simpleindividually, or with another borrower as tenants by the entireties or as jointtenants with right of survivorship, an interest in residential real propertysecuring a reverse mortgage loan, and who borrows money under a reversemortgage loan.

(3)        Commissioner. – TheCommissioner of Banks of this State.

(4)        Counselor. – Anindividual who has completed a training curriculum on reverse mortgagecounseling provided or approved by the North Carolina Housing Finance Agencyand whose name is maintained on the Commissioner's list of approved reversemortgage counselors.

(5)        Outstanding balance.– The current net amount of money owed by the borrower to the lender,calculated in accordance with G.S. 53‑262(b), whether or not the sum issuspended under the terms of the reverse mortgage loan agreement or isimmediately due and payable.

(6)        Reverse mortgageloan or loan. – A loan for a definite or indefinite term (i) secured by a firstmortgage or first deed of trust on the principal residence of the mortgagorlocated in North Carolina, (ii) the proceeds of which are disbursed to themortgagor in one or more lump sums, or in equal or unequal installments, eitherdirectly by the lender or the lender's agent, and (iii) that requires norepayment until a future time, upon the earliest occurrence of one or moreevents specified in the reverse mortgage loan contract.

(7)        Shared appreciation.– An agreement by the lender and the borrower that, in addition to theprincipal and any interest accruing on the outstanding balance of a reversemortgage loan, the lender may collect an additional amount equal to apercentage of the increase in the value of the property from the date oforigination of the loan to the date of loan repayment.

(7a)      Shared value. – Anagreement by the lender and the borrower that, in addition to the principal andany interest accruing on the outstanding balance of a reverse mortgage loan,the lender may collect an additional amount equal to a percentage of the valueof the property at the time of loan repayment.

(8)        Total annualpercentage rate. – The annual average rate of interest, which provides thetotal amount owed at loan maturity when this rate is applied to the loanadvances, excluding closing costs not paid to third parties, over the term ofthe reverse mortgage loan. (1991, c. 546, s. 1; 1995, c. 115, s. 1; 1998‑116,s. 3; 2004‑171, s. 15.)