53-263. Limits on borrowers' liability.
(a) When a reverse mortgage loan becomes due, if the borrower mortgaged one hundred percent (100%) of the full value of the house then the amount owed by the borrower shall not be greater than (i) the fair market value of the house, minus sale costs, or (ii) the outstanding balance of the loan, whichever amount is less.
(b) If the borrower mortgaged less than one hundred percent (100%) of the full value of the house, the amount owed by the borrower shall not be greater than (i) the outstanding balance of the loan, or (ii) the percentage of the fair market value, minus sale costs, as provided in the contract, whichever amount is less.
(c) The lender shall enforce the debt only through the sale of the property and shall not obtain a deficiency judgment against the borrower. (1991, c. 546, s. 1; 1995, c. 115, s. 1.)
Structure North Carolina General Statutes
North Carolina General Statutes
Chapter 53 - Regulation of Financial Services
Article 21 - Reverse Mortgages.
§ 53-258 - Authority and procedures governing reverse mortgage loans.
§ 53-259 - Application of rules.
§ 53-261 - Taxes, insurance, and assessments.
§ 53-262 - Renegotiation of loan; calculation of outstanding balance; prepayment.
§ 53-263 - Limits on borrowers' liability.
§ 53-264 - Disclosures of loan terms.
§ 53-265 - Information required of lender.
§ 53-266 - Effects of lender's default.
§ 53-267 - Repayment upon borrower's default.
§ 53-268 - Time for initiation of foreclosure.
§ 53-269 - Counseling provisions.
§ 53-270.1 - Contracts for shared appreciation or shared value.