Maryland 2025 Regular Session

Maryland Senate Bill SB831 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1
2	2
3	3	EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
4	4	[Brackets] indicate matter deleted from existing law.
5	5	sb0831
6	6
7	7	SENATE BILL 831
8	8	I2 5lr3384
9	9
10	10	By: Senator Charles
11	11	Introduced and read first time: January 28, 2025
12	12	Assigned to: Finance
13	13
14	14	A BILL ENTITLED
15	15
16	16	AN ACT concerning 1
17	17
18	18	Credit Regulation – Reverse Mortgage Loans – Escrow Accounts 2
19	19
20	20	FOR the purpose of requiring a lender for a reverse mortgage loan to establish a certain 3
21	21	escrow account for the payment of certain eligible homeowner expenses, deduct a 4
22	22	certain amount of funds from each loan distribution to a borrower, deposit the 5
23	23	deducted funds into the escrow account, and deliver on–time payments from the 6
24	24	escrow account to the appropriate collection entity for eligible homeowner expenses; 7
25	25	and generally relating to reverse mortgage loans and the payment of eligible 8
26	26	homeowner expenses. 9
27	27
28	28	BY renumbering 10
29	29	Article – Commercial Law 11
30	30	Section 12–1208 12
31	31	to be Section 12–1209 13
32	32	Annotated Code of Maryland 14
33	33	(2013 Replacement Volume and 2024 Supplement) 15
34	34
35	35	BY repealing and reenacting, without amendments, 16
36	36	Article – Commercial Law 17
37	37	Section 12–1201(a), (c), (f), and (h) 18
38	38	Annotated Code of Maryland 19
39	39	(2013 Replacement Volume and 2024 Supplement) 20
40	40
41	41	BY adding to 21
42	42	Article – Commercial Law 22
43	43	Section 12–1208 23
44	44	Annotated Code of Maryland 24
45	45	(2013 Replacement Volume and 2024 Supplement) 25
46	46	2 SENATE BILL 831
47	47
48	48
49	49	SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 1
50	50	That Section(s) 12–1208 of Article – Commercial Law of the Annotated Code of Maryland 2
51	51	be renumbered to be Section(s) 12–1209. 3
52	52
53	53	SECTION 2. AND BE IT FURTHER ENACTED, That the Laws of Maryland read 4
54	54	as follows: 5
55	55
56	56	Article – Commercial Law 6
57	57
58	58	12–1201. 7
59	59
60	60	(a) In this subtitle the following words have the meanings indicated. 8
61	61
62	62	(c) “Borrower” means an individual who makes a loan application for or receives 9
63	63	a reverse mortgage loan. 10
64	64
65	65	(f) “Lender” means a person who makes a reverse mortgage loan. 11
66	66
67	67	(h) “Reverse mortgage loan” means a nonrecourse loan that: 12
68	68
69	69	(1) Is secured by the borrower’s principal dwelling; 13
70	70
71	71	(2) Provides the borrower with purchase money proceeds, a lump sum 14
72	72	payment, periodic cash advances, a line of credit, or any combination of those payment 15
73	73	plans based on the equity in or value of the borrower’s principal dwelling; and 16
74	74
75	75	(3) Requires no payment of principal or interest until the full loan becomes 17
76	76	due and payable. 18
77	77
78	78	12–1208. 19
79	79
80	80	(A) (1) A LENDER SHALL ESTABLI SH AN ESCROW ACCOUNT FOR A 20
81	81	REVERSE MORTGAGE LOA N TO BE USED FOR THE PAYMENT OF: 21
82	82
83	83	(I) PROPERTY TAXES ; 22
84	84
85	85	(II) INSURANCE PREMIUMS FO R AN INSURANCE PRODUCT 23
86	86	REQUIRED UNDER § 12–1206(A)(2) OF THIS SUBTITLE; 24
87	87
88	88	(III) GROUND RENTS ; 25
89	89
90	90	(IV) WATER AND SEWER FACIL ITIES ASSESSMENTS ; AND 26
91	91
92	92	(V) HOMEOWNERS ASSOCIATIO N OR OTHER COMMON 27
93	93	OWNERSHIP COMMUNITY CHARGES. 28
94	94	SENATE BILL 831 3
95	95
96	96
97	97	(2) AN ESCROW ACCOUNT REQ UIRED UNDER PARAGRAP H (1) OF THIS 1
98	98	SUBSECTION SHALL : 2
99	99
100	100	(I) BE ESTABLISHED IN ACC ORDANCE WITH § 12–1026 OF THIS 3
101	101	TITLE; AND 4
102	102
103	103	(II) ALLOW FOR MONTHLY COL LECTION AND DEPOSIT OF 5
104	104	FUNDS. 6
105	105
106	106	(B) A LENDER SHALL : 7
107	107
108	108	(1) DEDUCT FROM EACH DIST RIBUTION OF FUNDS TO THE 8
109	109	BORROWER UNDER THE TERMS OF THE LOAN AND DEPOSIT INTO AN ESCRO W 9
110	110	ACCOUNT ESTABLISHED UNDER SUBSECTION (A) OF THIS SECTION AN AMOUNT OF 10
111	111	FUNDS THAT IS: 11
112	112
113	113	(I) PROPORTIONAL TO THE P LANNED DISTRIBUTION 12
114	114	SCHEDULE OF FUNDS UNDER THE TERMS OF T HE LOAN; AND 13
115	115
116	116	(II) SUFFICIENT TO COVER T HE ESTIMATED COSTS OF THE 14
117	117	ELIGIBLE HOMEOWNER EXPENSES DESCRIBED U NDER SUBSECTION (A)(1) OF THIS 15
118	118	SECTION; 16
119	119
120	120	(2) DELIVER AN ON–TIME PAYMENT OF EACH ELIGIBLE HOMEOWNER 17
121	121	EXPENSE DESCRIBED UN DER SUBSECTION (A)(1) OF THIS SECTION FROM THE 18
122	122	APPROPRIATE ESCROW A CCOUNT ESTABLISHED U NDER SUBSECTION (A) OF THIS 19
123	123	SECTION TO THE COLLECTION EN TITY FOR EACH ELIGIB LE EXPENSE. 20
124	124
125	125	SECTION 3. AND BE IT FURTHER ENACTED, That this Act shall take effect 21
126	126	October 1, 2025. 22