6-1706. Borrower liability; prohibited practices; investments; annuities
A. The borrower is not liable for any difference between the net amount of the borrower's remaining debt under the reverse mortgage and the amount recovered by the originator from the net sales proceeds from the dwelling that is subject to the reverse mortgage. This amount is based on the amount of the accumulated equity selected by the borrower to be subject to the reverse mortgage as agreed on by the originator and the borrower.
B. An originator shall not:
1. Enter into any agreement that would obligate the borrower to purchase an annuity, an investment or long-term care insurance before the closing of the reverse mortgage or before the expiration of the borrower's right to rescind the reverse mortgage agreement if a rescission period applies.
2. Refer the borrower to anyone for the purchase of an annuity before the closing of the reverse mortgage or before the expiration of the borrower's right to rescind the reverse mortgage agreement.
C. This section does not prevent a lender from offering or referring borrowers for title insurance, hazard, flood or other peril insurance or other similar products that are customary and normal under a reverse mortgage loan.Section: Previous 6-1417 6-1418 6-1419 6-1501 6-1502 6-1601 6-1701 6-1702 6-1703 6-1704 6-1705 6-1706 6-1707 6-1708 Next
Last modified: October 13, 2016