W. Va. Code R. § 106-19-7

Current through Register Vol. XLI, No. 35, August 30, 2024

Section 106-19-7 - Additional Features of Reverse Mortgage Loans

7.1. Escrow Account for Taxes and Insurance. -- The lender may maintain an escrow account for purposes of paying real estate taxes and insurance on the real property securing the loan. The lender shall calculate these escrowed amounts in conformity with the method provided by federal laws, regulations, or guidelines for other residential mortgage lenders.

7.2. Shared Appreciation. -- The security agreement may provide that the lender receive a percentage of the future appreciation of the real property securing the loan, i.e., "shared appreciation", in addition to or in lieu of fixed or variable rate interest . This appreciation shall not be considered interest for purposes of any law regulating the maximum rate of interest which may be charged, taken or received. Loans which contain "equity participation" as provided for in subsection 6.7 of this rule may not provide for any other forms of equity sharing or shared appreciation.

7.3. Mortgagor's Right to Lifetime Possession. B Except where the reverse mortgage has a set fixed term and maturity date, all mortgagor(s) shall retain the right to lifetime possession of the real property which serves as security for the loan, as long as the real property remains the mortgagor(s)= principal residence and subject to the conditions set forth in section 9 of this rule and W. Va. Code '47-24-4(g).

7.4. Mortgage Insurance. -- The mortgagor(s) may elect to maintain mortgage insurance for the principal and any accrued but unpaid interest. The insurance shall name the mortgagee as beneficiary. This insurance may not be required by the lender as a condition for granting a reverse mortgage loan. This insurance shall not be offered by the lender where the loan is to be sold into the secondary market and the lender has obtained a written commitment from the investor prior to the loan closing to purchase the loan, and has arranged for the delivery of the loan to the investor within forty-five days of the loan closing.

7.5. Lender's Limited Waiver of the Right of Foreclosure. -- Prior to offering reverse mortgage loans, all lenders shall prepare a form entitled "Lender's Limited Waiver of the Right of Foreclosure" for review and approval by the Commissioner of Banking to ensure that this document sets forth the termination events, as applicable, pursuant to section 9 of this rule and W. Va. Code '47-24-4(g). This document shall be executed by the lender in connection with the closing of every reverse mortgage loan. The lender shall furnish a copy of the executed form to every mortgagor(s) at closing and shall keep the original form on file for the life of the loan.

W. Va. Code R. § 106-19-7