In General

(1) Purpose. In enacting the Home Equity Conversion Mortgage Act, (T.C.A. § 47-30-101 et seq.) the General Assembly expressed its intent: (1) to authorize reverse mortgage loans under the provisions, terms and conditions imposed under the act and (2) that nothing in the act shall be construed to apply to or restrict any loan, mortgage or deed of trust which is valid under any other provision of law. The purpose of this rule is to implement and provide for the enforcement of the provisions of the act. This rule shall not require any federally chartered institution to seek authorization from the commissioner to engage in any activity or transaction specifically authorized, without regard to state law, by federal law or regulation. (2) Scope. The provisions of this rule shall govern the implementation and enforcement of the Home Equity Conversion Mortgage Act. (“the Act”) (3) Definitions. For purposes of this rule, the following definitions shall apply, unless the context otherwise requires: (a) “Act” means the Home Equity Conversion Mortgage Act codified as Title 47, Chapter 30 of the Tennessee Code Annotated. (b) “Applicant” means those entities which to become authorized must submit an application to the commissioner pursuant to T.C.A. § 47-30-103(c) and Chapter 0180-24-.04. However, for the sole purpose of Chapter 0180-24-.01(3) the term applicant shall also include those entities seeking designation as an authorized lender by providing notice to the commissioner pursuant to T.C.A. § 47-30-103(b) and Chapter 0180-24-.03. (c) “Authorized lender” or “lender” means: 1. A bank savings and loan association, savings bank, savings institution, or credit union chartered under the laws of the United States or of Tennessee; 2. The Tennessee housing development agency; provided, that such agency has authority by THDA board resolution to issue mortgages under this chapter; or 3. Any other person authorized to make home equity conversion loans by the commissioner of financial institutions; (d) “Borrower” means a natural person who occupies and owns in fee simple individually, or with another borrower as tenants by the entireties or as joint tenants with right of survivorship, an interest in residential real property securing a reverse mortgage loan, and who borrows money under a reverse mortgage loan; RULES PERTAINING TO HOME EQUITY CONVERSION MORTGAGES CHAPTER 0180-24 (e) “Commissioner” means the commissioner of financial institutions; (f) “Counselor” means an individual who has completed a training curriculum on reverse mortgage counseling provided or approved by the United States department of housing and urban development and whose name is maintained on HUD’s list of approved reversed mortgage counselors; (g) “Cost” means the average salary and actual travel expenses directly attributable to the field staff examining the financial institution and such expenses of any supervisory or other staff required as a result of examination findings. (h) “Home Equity Conversion Mortgage Loan” means a loan for a definite or indefinite term: 1. Secured by a first mortgage or first deed of trust on the principal residence of the mortgagor; 2. The proceeds of which are disbursed to the mortgagor in one (1) or more lump sums, or in equal or unequal installments, either directly by the lender or the lender’s agent; 3. That requires no repayment until a future time, upon the earliest occurrence of one (1) or more events specified in the reverse mortgage loan contract; and 4. Is labeled clearly on the face of the note and deed of trust or mortgage “This is a Home Equity Conversion Mortgage Loan pursuant to Tennessee Code Annotated, Title 47, Chapter 30”. (i) “HUD” means the United States department of housing and urban development; (j) “Outstanding balance” means the current net amount of money owed by the borrower to the lender, calculated in accordance with § 47-30-106, whether or not the sum is suspended under the terms of the reverse mortgage loan agreement or is immediately due and payable; (k) “Reverse Mortgage” means a mortgage or deed of trust securing a home equity conversion loan or reverse mortgage loan; (l) “Reverse mortgage loan” means a home equity conversion mortgage loan issued under the terms of this chapter; and (m) “Savings Institution” means a savings and loan association or a savings bank.