Nev. Rev. Stat. § 106.500

Current through 82nd (2023) Legislative Session Chapter 535 and 34th (2023) Special Session Chapter 1 and 35th (2023) Special Session Chapter 1

Section 106.500 - Borrower's instruction to suspend and close equity line of credit: Form; effect

1. Upon receipt of a written request from an authorized person to terminate an equity line of credit secured by a mortgage or deed of trust, the lender shall:

(a) Terminate the borrower's right to obtain advances under the borrower's equity line of credit;

(b) Apply all sums subsequently paid by or on behalf of the borrower in connection with the equity line of credit to the satisfaction of the equity line of credit and other sums secured by the related security instrument; and

(c) When the balance of all outstanding sums secured by the related security instrument becomes zero, record a reconveyance or certificate of discharge of the security instrument.

2. Upon receipt from an authorized person of an instruction from a borrower to suspend and close an equity line of credit, the lender shall suspend the equity line of credit for a minimum of 30 days if the instruction is:

(a) Prepared and presented to the lender by the authorized person;

(b) Signed by the borrower; and

(c) Made in substantially the following form:

BORROWER'S INSTRUCTION TO SUSPEND AND CLOSE EQUITY LINE OF CREDIT

Lender: [Name of lender]

Borrower: [Name of borrower]

Account number of equity line of credit: [Account number]

Address of encumbered property: [Property address]

Escrow agent or settlement agent: [Name of agent]

In connection with a sale or refinance of the above-referenced property, my escrow agent or settlement agent has requested a payoff demand statement for the above-described equity line of credit. I understand that my ability to use this equity line of credit has been suspended for at least 30 days to accommodate this pending transaction. I understand that I cannot use any credit card, debit card or check associated with this equity line of credit while it is suspended, and all amounts of money will be due and payable upon close of escrow. I also understand that when payment is made in accordance with the payoff demand statement, my equity line of credit will be closed. If any amounts of money remain due after the payment is made, I understand that I will remain personally liable for those amounts of money even if the equity line of credit has been closed and the property released.

This is my written authorization and instruction that you are to close my equity line of credit and cause the secured lien against this property to be released when you are in receipt of both this instruction and payment in accordance with your payoff demand statement.

..........................................................

(Date)

..........................................................

(Signature of each borrower)

3. If a lender is in receipt of an instruction from a borrower to suspend and close an equity line of credit and payment in accordance with the payoff demand statement, the lender shall:

(a) Close the equity line of credit; and

(b) Release or reconvey the property securing the equity line of credit as provided in this chapter.

4. A lender may conclusively rely on a representation by the authorized person that presents an instruction of a borrower to suspend and close an equity line of credit that the instruction is that of the borrower.

5. As used in this section:

(a) "Authorized person" includes:

(1) A title agent as defined in NRS 692A.060;

(2) A title insurer as defined in NRS 692A.070; and

(3) An escrow agency as defined in NRS 645A.010.

(b) "Receipt of a written request" includes confirmation by facsimile, electronic record, as defined in NRS 719.090, or paper copy sent by certified mail.

NRS 106.500

Added to NRS by 2015, 1610