§ 11-38-107 — Repayment

Colorado § 11-38-107

• Jurisdiction: Colorado
• Title 11: Financial
• Art.: Reverse Mortgages

Text

(1) A reverse mortgage may become due and
payable upon the occurrence of any one of the following events:

(a) The home securing the reverse mortgage is sold.

(b) The borrower ceases to occupy the home as a principal residence.

(c) Any fixed maturity date agreed to by the lender and the borrower is
reached.

(d) An event occurs which is specified in the terms of the reverse mortgage
and which jeopardizes the lender's security.

(e) Upon death of the borrower.

(2) The repayment requirement described in subsection (1) of this section is
also expressly subject to the following additional conditions:

(a) Temporary absences from the home not exceeding sixty consecutive
days shall not cause the reverse mortgage to become due and payable.

(b) Temporary absences from the home exceeding sixty consecutive days
but not exceeding one year shall not cause the reverse mortgage to become due
and payable so long as the borrower has taken prior action which secures the home
in a manner satisfactory to the lender.

(b.5) (I) To the extent allowable by the United States department of housing
and urban development's regulations and policies, a temporary absence from the
home, if the absence is a result of a natural disaster or other force majeure
rendering the home temporarily uninhabitable, does not cause the reverse
mortgage to become due and payable if:

(A) The borrower is engaged in repairing the home with the intent to
reoccupy the home as a principal residence or to sell the home;

(B) The borrower stays in communication with and reasonably responds to
inquiries from the lender while the home is being repaired;

(C) The borrower complies with all other terms and conditions of the reverse
mortgage; and

(D) The repairing or rebuilding of the home does not reduce the lender's
security.

(II) At the time of closing, the lender shall disclose the requirements of
subsection (2)(b.5)(I) of this section to the borrower in writing.

(c) The lender's right to collect reverse mortgage proceeds shall be subject
to the applicable statute of limitations for loan contracts pursuant to section 13-80-103.5, C.R.S.; except that the statute of limitations shall commence on the date that
the reverse mortgage becomes due and payable.

(d) Prior to the closing of a reverse mortgage, the lender must prominently
disclose any interest or other fees to be charged during the period that commences
on the date that the reverse mortgage becomes due and payable and ends when
repayment in full is made.

Legislative History

Source: L. 92: Entire article added, p. 941, � 1, effective April 23. L. 2023: (2)(b.5) added, (HB 23-1266), ch. 440, p. 2580, � 2, effective June 7.