Section 140. Acts of default

The occurrence of any of the following events will constitute an act of default for which the home equity account loan shall, at the option of the authority, become immediately due and payable:

1. The imposition on the home or any part thereof of any lien or encumbrance (including mechanics' or tax liens) without the authority's prior written consent, if such lien or encumbrance may have priority over the lien of the home equity account loan or any prior or future equity payments thereunder and is not removed within 90 days.

2. Physical deterioration of the home beyond normal wear and tear and failure to repair, replace and maintain the various components of the home when required or necessary, including the failure to repair damage caused by fire or other casualty within a reasonable time after the occurrence as determined by the authority in its sole discretion.

3. Failure to make payment to the authority for taxes and insurance premiums as described in 13VAC10-150-120.

4. A borrower's admission of his inability to pay his debts, making any assignment for the benefit of creditors or filing for relief under federal bankruptcy statutes. The filing of a petition in bankruptcy against the borrower without the borrower's consent will not be an act of default if the petition is dismissed within 60 days of filing.

5. Any omission or misrepresentation by the applicant in the application or in any equity payment request.

6. Any other occurrence which constitutes a default under the terms of the deed of trust securing the home equity account loan.

Upon default, the authority shall be entitled to exercise any one or more of the remedies set forth in the home equity account loan documents or available at law or in equity; provided, however, that, except in the case of a default as described in subdivisions 2 and 5 of this section, the authority shall not seek any personal judgment against the borrower but shall look solely to the home for payment of the home equity account loan.

Historical Notes

Derived from VR400-02-0015 § 4.7, eff. July 19, 1988; amended, Volume 05, Issue 06, eff. November 21, 1988; Volume 05, Issue 21, eff. July 1, 1989.

Statutory Authority

§ 36-55.30:3 of the Code of Virginia.