W. Va. Code R. § 106-19-9

Current through Register Vol. XLI, No. 36, September 6, 2024

Section 106-19-9 - Termination of Reverse Mortgage Loans

9.1. Termination Due to Non-temporary Absences. -- A reverse mortgage loan may be terminated by a lender pursuant to W. Va. Code '47-24-4(g)(2)(B) where the mortgagor(s) ceases to use the real property as his or her principal place of residence for more than 60 consecutive days in any 365 day period without notifying the lender and making arrangements satisfactory to the lender for the maintenance of the real property and the anticipated return of the mortgagor(s). For purposes of this section the term "principal place or residence" means the living and sleeping quarters of the mortgagor. The lender shall not unreasonably withhold consent to the arrangements made by the mortgagor(s) pursuant to this section.

9.2. Termination Due to Events Jeopardizing Lender's Security. -- A reverse mortgage loan may only be terminated by the lender pursuant to W. Va. Code '47-24-4(g)(1)(D) for the following events as specified in the loan documents:

9.2.a. the mortgagor(s) fails to pay real estate taxes or maintain all insurance required pursuant to the security agreement;

9.2.a.1. If the mortgagor(s) fails to pay taxes or maintain all required insurance, then the lender shall within ten business days of learning of such event, give written notice of the failure to the mortgagor(s) and the third-party, if any, designated by the mortgagor(s) to receive notice of any event that could lead to termination. If the mortgagor(s) has not named a third-party or if the third-party can not be contacted, then the lender shall give written notice of the failure to the County Clerk of the county where the property is located. The lender must give the mortgagor(s) thirty (30) calendar days to cure such failure. In addition, the notice to the mortgagor(s) and the third party shall advise the mortgagor(s) of his or her right to cure the problem.

9.2.a.2. The failure to pay taxes or maintain all required insurance shall not be construed to be a termination event unless the lender has complied with the provisions set forth in paragraph (1) of this subdivision.

9.2.b. the mortgagor(s)= (i) filing a voluntary petition in bankruptcy or effecting a plan or other arrangement with creditors under court supervision, (ii) having an involuntary petition in bankruptcy filed against the mortgagor that is not discharged within 90 days after it is filed, or (iii) applying for or permitting the appointment of a receiver, trustee or custodian for the real property securing the loan which is not discharged within 90 days after the date of appointment. Provided, That the appointment of a conservator, guardian, committee or other fiduciary of the person to act on the mortgagor(s)= behalf in connection with a determination by a court that the mortgagor(s) is incompetent will not terminate the loan; or

9.2.c. the mortgagor(s) fails to maintain the structural integrity of the real property, as that term is defined in section 8 of this rule. The lender is required to make reasonable efforts to remedy any breach of structural integrity prior to a termination of a reverse mortgage loan under this subdivision.

9.3. Notification in Writing to Mortgagor. -- The mortgagor(s) or his or her estate shall notify the lender, in writing, promptly upon (i) the sale or other transfer of title to the home securing the loan; (ii) upon the mortgagor's death, or if there is more than one mortgagor, then upon the death of the last living mortgagor; or (iii) the occurrence of any event listed in subsections 9.1 or 9.2 of this section which would also cause the loan to terminate.

W. Va. Code R. § 106-19-9