State Codes and Statutes

State Codes and Statutes

Statutes > North-carolina > Chapter_53 > GS_53-266

§53‑266.  Effects of lender's default.

(a)        A lender's failureto make loan advances to the borrower under the reverse mortgage loan contractshall be deemed the lender's default of the contract.  Upon the lender'sdefault, the lender shall forfeit any right to collect interest or servicecharges under the contract.  The lender's right to recovery at loan maturityshall be limited to the outstanding balance as of the date of default, minusall interest.  Lenders may also be subject to other default penaltiesestablished by the Commissioner.

(b)        Subsection (a) ofthis section shall not apply if the lender has previously declared the borrowerin default under G.S. 53‑267, or if the lender makes the required loanadvance within the time stated in the mortgage contract or within 30 days ofreceipt of notice from the borrower that the loan advance was not received. (1991,c. 546, s. 1; 1995, c. 115, s. 1.)