Requirements for advancement of money on security of real property.

13-03-02-02. Requirements for advancement of money on security of real property. No state-chartered credit union may advance money on security of real property until the following requirements are met: 1. The mortgage has been properly signed and recorded in the office of the county recorder where the real property is located. 2. The credit union must verify that the mortgagor has the right to convey the real property and the credit union must determine the order of priority of the lien established by the mortgage. 3. For real estate loans equal to or more than one million dollars or four hundred thousand dollars for residential real estate not insured, an appraisal must be conducted by a licensed or certified appraiser if required under 12 Code of Federal Regulations part 722. 4. For real estate loans that do not meet the requirements of subsection 3, a credit union must obtain an appropriate evaluation of real property collateral for transactions if an appraisal by a licensed or certified appraiser is not obtained. 5. Regardless of the value of a real estate loan, the commissioner may issue an order requiring an appraisal by a licensed or certified appraiser when necessary to address safety and soundness concerns. 6. Adequate casualty fire and tornado insurance has been obtained and is maintained throughout the life of the loan with a mortgage clause for the benefit of the credit union. 7. A note for the amount of the loan has been signed by the mortgagor or mortgagors consistent with the terms of the mortgage. 8. The credit union may make exceptions to subsections 2, 3, and 6 of this section if the mortgage is taken as an abundance of caution as set forth in 12 CFR 722.3, and the value of the real property security is not used as part of the analysis of the borrower's credit worthiness. History: Amended effective May 1, 1982; November 1, 1985; October 1, 1994; August 1, 1998; December 1, 2002; January 1, 2013; January 1, 2019; April 1, 2022. General Authority: NDCC 6-01-04 Law Implemented: NDCC 6-06-06 1