Section 49-2(c) of the Connecticut General Statutes provides that advancements for taxes and other items may be made by a mortgagee or assignee of the mortgagee, under an open-end mortgage if certain requirements are met. One of the requirements states that the security instrument shall contain specific provisions permitting such advancements and, if applicable, shall specify that such advancements are made pursuant to a commercial future advance loan agreement, a consumer revolving loan agreement or a letter of credit.
Based on the statutory requirement, DocMagic is updating the ADVANCES section of the Non-MERS Connecticut HELOC Open-End Mortgage Deed (Form ID CTHESI.HLC) and the MERS Connecticut HELOC Open-End Mortgage Deed (FORM ID CTHESIM.HLC), to include the italicized language in the following paragraph:
“During the Draw Period described in the Agreement, the Borrower may repeatedly take and repay any advances that Lender makes to Borrower under the terms of the Agreement which is a consumer revolving loan agreement as defined in section 49-2(c) of the Connecticut General Statutes, and this Security Instrument, subject to the terms that the Agreement and this Security Instrument impose.”
Updates to the Connecticut HELOC Open-End Mortgage Deeds will be implemented on September 12, 2019. If you should have questions, please contact DocMagic’s Compliance Department.
