Account Holder Acknowledgement (Note Investments)
As noted in the General Buy Direction Letter.
Terms:
The following items are the responsibility of the IRA holder when the IRA is investing in a note:
A copy of the original note must be in the possession of New Direction Trust Company (NDTCO), where it is held by NDTCO. I understand the follow-up on the delivery of the original note from the closing to NDTCO is mine. Failure to obtain the original note may result in the IRA having to purchase a lost instrument bond, the cost of which varies from county to county but can run to about 1.5% to 2.5% of the full face-value of the note.
The purchase of a lender’s title policy for the IRA is the account holder’s responsibility but is not required by NDTCO for funding. NDTCO will review the named insured on the title policy if you have selected this coverage.
In the event the IRA is lending on improved property, I understand that it is my responsibility to have the IRA named as an additional insured on the hazard insurance policy, but that this is not an NDTCO requirement for funding the transaction. It is also my responsibility to ensure the IRA remains continuously insured throughout the term of the note. I understand that NDTCO is not a loan servicer and takes no responsibility for enforcing this or any other terms of the loan.
If the note has an unpaid principal balance at the maturity date, it is the IRA holder’s responsibility to either modify the note extending the maturity date or to deem the note as un-collectible. I understand notes past maturity may be disbursed to me at the last known value.
I understand that NDTCO does not provide recording services and that I am responsible for recording any security documents that I would like to have recorded.