North Carolina Origination Reference Guide
- Kacey Olson
Owned by Kacey Olson
| Citation | Topic | Requirement |
| Interest / N.C. Gen. Stat. §24-10.2 | Borrower Reasonable Tangible Net Benefit Worksheet (Optional Form) | A lender may not knowingly or intentionally engage in the unfair act or practice of flipping a consumer home loan. “Flipping” a consumer loan is the making of a consumer home loan to a borrower which refinances an existing consumer home loan when the new loan does not have reasonable, tangible net benefit to the borrower considering all of the circumstances, including the terms of both the new and refinanced loans, the cost of the new loan, and the borrower's circumstances. Worksheet not specifically mandated by statute or regulation but compliance with requirements is required. |
| Reverse Mortgage Act / N.C. Gen. Stat. §53-270 | Certification of Counseling | May not close a reverse mortgage loan without receiving certification that the borrower has received counseling on the advisability of a reverse mortgage loan and the various types of reverse mortgage loans and the availability of other financial options and resources for the borrower, as well as potential tax consequences. |
| Good Funds Settlement Act / N.C. Gen. Stat. §45A-4 | Disbursement of Closing Funds | A settlement agent must not disburse any of the closing funds prior to recordation of the deed of trust or mortgage or other loan documents required to be recorded and the settlement agent must have verification that the closing funds used to fund the disbursement are deposited in the settlement agent's trust or escrow account. Additionally, settlement agents are prohibited from disbursing settlement proceeds unless those proceeds are collected funds or in 1 of the forms listed above. |
| Reverse Mortgage Act / N.C. Gen. Stat. §53-265(a) | Disclosure of Lender's Employee or Agent | At the closing of a reverse mortgage loan, lender must provide borrower the name of lender's employee or agent who has been designated specifically to respond to inquiries concerning reverse mortgage loans. This information must be provided by the lender to the borrower at least annually, and whenever the information concerning the designated employee or agent changes. |
| Reverse Mortgage Act / N.C. Gen. Stat. §53-264(b) | Disclosure of Loan Terms | Within 10 business days after application is made by a borrower, but not less than 20 business days prior to the closing of the loan, lenders must provide applicants with the loan terms initially provided to the commissioner, inform applicants that reverse mortgage counseling is required before the loan can be closed, and provide the names and addresses of counselors listed with the Commissioner's office. |
| N.C. Gen. Stat. §24-10.1(b) | Late Fees | No lender may charge a late payment charge: (1) In excess of four percent (4%) of the amount of the payment past due; or (2) In excess of the amount disclosed with particularity to the borrower pursuant to the provisions of the Federal Consumer Credit Protection Act if the transaction is one to which the provisions of that act apply, which in no event shall exceed four percent (4%); or (3) For any payment unless past due for 15 days or more; provided, however, if the loan is one on which interest on each installment is paid in advance, no late payment charge may be charged until the payment is 30 days past due or more; or (4) More than once with respect to a single late payment. If a late payment charge is deducted from a payment made on the contract and such deduction results in a subsequent default on a subsequent payment, no late payment charge may be imposed for such default. If a late payment charge has been once imposed with respect to a particular late payment, no such charge shall be imposed with respect to any future payment which would have been timely and sufficient but for the previous default; provided that when a borrower fails to make an installment payment, and the terms of the loan agreement provide that subsequent payments shall first be applied to the past-due balance, and the borrower resumes making installment payments but has not paid all past-due installments, then the lender may enforce the contract according to its terms, imposing a separate late payment charge for each installment that becomes due until the default is cured; or (5) On any loan which by its terms calls for repayment of the entire balance in a single payment and not for installments of interest or principal and interest; or (6) Unless the lender notifies the borrower within 45 days following the date the payment was due that a late payment charge has been imposed for a particular late payment which late payment must be paid unless the borrower can show that the installment was paid in full and on time. No late payment charge may be collected from any borrower if the borrower informs the lender that nonpayment of an installment is in dispute and presents proof of payment within 45 days of receipt of the lender's notice of the late charge. |
| Secure and Fair Enforcement Mortgage Licensing Act / N.C. Gen. Stat. §53-244.107 | NMLS Unique Identifier | The NMLS unique identifier of any mortgage loan originator, transitional mortgage loan originator, or other person engaged in the mortgage business must be clearly shown on all residential mortgage loan application forms, solicitations, advertisements, including business cards or Web sites, and any other documents as established by rule or order of the Commissioner. |
| Interest / N.C. Gen. Stat. §24-1.1A(a1) | Notice of Information and Examples of Amortization of Home Loans | For loan amounts less than $300,000. No later than 3 business days after a home loan closing, the lender must deliver or mail to the borrower an amortization schedule for the borrower's home loan. This requirement applies to fixed-rate home loans that require the borrower to make regularly scheduled periodic amortizing payments of principal and interest. |
| Interest / N.C. Gen. Stat. §24-1.1E | Notice of Right to Select Attorney | Attorney’s fees are excluded from the definition of “Points and Fees” for purposes of high cost home loan determination, if the borrower has the right to select the attorney from an approved list or otherwise. |
| Interest / N.C. Gen. Stat. §24-1.1E(a)(5)(b) | Notice of Right to Select Attorney | Attorney’s fees are excluded from the definition of “Points and Fees” for purposes of high-cost mortgage determination, if the borrower has the right to select the attorney from an approved list or otherwise. |
| Secure and Fair Enforcement Mortgage Licensing Act / N.C. Gen. Stat. §53-244.111(13) | Rate Spread Adjustable Rate Loan Disclosure | Mortgage brokers and exclusive mortgage brokers must disclose to the borrower the terms and costs associated with a fixed rate loan from the same lender at the lowest annual percentage rate for which the borrower qualifies when brokering a rate spread adjustable rate mortgage loan. |
| Reverse Mortgage Act / N.C. Gen. Stat. §53-270.1 | Reverse Mortgage Shared Appreciation or Shared Value | 14 days prior to closing the borrower must receive a disclosure that explains the additional costs & benefits of shared appreciation or shared value & compares those costs & benefits with a comparable loan without shared appreciation or shared value. |
| Insurance / N.C. Gen. Stat. §58-57-65 | Right to Choose Insurer | When credit property insurance is required for any indebtedness, the debtor must be notified in writing of the option of furnishing the required amount of insurance through existing policies owned or controlled by him or of procuring and furnishing the required coverage through any insurer authorized to transact an insurance business within this State. |
| N.C. Gen. Stat. Ann. § 47-17.1 | Security Instrument | The register of deeds of any county in North Carolina shall not accept for registration, nor shall any judge order registration pursuant to G.S. 47-14, of any deeds or deeds of trust, executed after January 1, 1980, unless the first page of the deeds or deeds of trust bears an entry showing the name of either the person or law firm who drafted the instrument. This section shall not apply to other instruments presented for registration. For the purposes of this section, the register of deeds shall accept the written representation of the individual presenting the deed or deed of trust for registration, or any individual reasonably related to the transaction, including, but not limited to, any employee of a title insurance company or agency purporting to be involved with the transaction, that the individual or law firm listed on the first page is a validly licensed attorney or validly existing law firm in this State or another jurisdiction within the United States. |