The Arizona Revised Statutes have been updated to include the revised sections from the 54th Legislature, 2nd Regular Session. Please note that the next update of this compilation will not take place until after the conclusion of the 55th Legislature, 1st Regular Session, which convenes in January 2021.
This online version of the Arizona Revised Statutes is primarily maintained for legislative drafting purposes and reflects the version of law that is effective on January 1st of the year following the most recent legislative session. The official version of the Arizona Revised Statutes is published by Thomson Reuters.
A. Prepayment, in whole or in part, shall be permitted without penalty at any time during the term of a reverse mortgage.
B. For the purposes of this section, penalty does not include:
1. Any fees, payments or other charges that would otherwise be due when the reverse mortgage becomes due and payable.
2. Any closing costs that the agreement states are owed by the borrower if the borrower repays the reverse mortgage in whole before the date in the agreement, if the repayment occurs within five years after the date on which the agreement was made.
C. A reverse mortgage becomes due and payable if any of the following applies:
1. The property is not the principal residence of at least one borrower.
2. A borrower conveys all of the borrower's title in the property and no other borrower retains title.
3. For a period of longer than twelve consecutive months, a borrower fails to occupy the property because of physical or mental illness and the property is not the principal residence of at least one other borrower.
4. A borrower does not perform an obligation under the mortgage.
D. A reverse mortgage does not become due and payable if the legal title to the property is held in the name of a trust and the occupant of the property uses the property as a principal residence and is a beneficiary of that trust.
E. The creditor's or the creditor's assignee's right to collect the outstanding balance of the reverse mortgage under the loan is subject to the applicable statute of limitations for written loan contracts. Notwithstanding any other law, the statute of limitations begins on either of the following:
1. The date that the reverse mortgage becomes due and payable as specified in the agreement.
2. The date the creditor or the creditor's assignee accelerates the loan due to the borrower's default on a provision in the agreement.