Colorado § 11-38-107 - Repayment.

§ 11-38-107. Repayment.

(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.

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.