Civil Code section 1917.712

(a)

Each lender making a shared appreciation loan for seniors shall also furnish to the prospective borrower, prior to the consummation of the loan, the disclosures required by Subpart C of Federal Reserve Board Regulation Z (12 C.F.R. Part 226), including 12 C.F.R. Section 226.18(f), to the extent applicable to the transaction.

(b)

The disclosure made pursuant to subdivision (a) and Regulation Z shall be based on the fixed interest rate of the shared appreciation loan for seniors, and shall include a description of the shared appreciation feature, including (1) the conditions for its imposition, the time at which it would be collected, and the limitations on the lender’s share, as required by the Federal Reserve Board in the information published by the board in 46 Federal Register 20877-78 (April 7, 1981), and (2) the lender’s share of the appreciated value and the prevailing interest rate as defined in Section 1917.320.

(c)

The disclosure made pursuant to subdivision (a) and Regulation Z shall be accompanied by (1) several transaction-specific examples of the operation and effect of the shared appreciation loan and (2) the following charts comparing the shared appreciation loan and a conventional loan made at the prevailing interest rate, and illustrating the possible increase in the monthly payments, and the possible annual percentage rate of finance charge, on the assumptions therein stated:
Chart 1
CONVENTIONAL MORTGAGE AT ____%
If the same loan balance were financed under a conventional, 30-year, fixed-rate, level-payment mortgage, your monthly payments would be:
Years 1–30
$_______/mo.
Chart 2
IF YOU REFINANCE THIS TRANSACTION AT ___%
If your property appreciates at 10% per year, and if your loan obligation (including contingent interest due) at the end of __ years is refinanced at __% (the prevailing market interest rate now), your monthly payments will be:
Years 1–__Refinancing loan
$_______/mo.$_______/mo.*
*
Refinancing loan, assuming a conventional, 30-year, fixed-rate, level-payment mortgage. Other mortgage instruments, e.g., graduated-payment or shared-appreciation, if available, may result in lower payments.
Chart 3
APR IF PROPERTY APPRECIATES AT 10%
If your property appreciates at 10% per year, the total finance charge on your shared appreciation loan for seniors (including contingent interest) will equal $____, and the annual percentage rate of the total finance charge (including actual contingent interest) will equal ____%.

(d)

The disclosures required by subdivision (c) shall be separate from the disclosures required by Regulation Z, and may be presented in the document containing the disclosures required by Regulation Z or in one or more separate documents.

(e)

Except to the extent that this section requires disclosure of additional information not required by Regulation Z, compliance with the applicable credit disclosure requirements of Regulation Z shall constitute compliance with the requirements of this section.

(f)

The disclosure prescribed in Section 1917.711 shall be physically attached to the disclosures required by this section and Regulation Z at the time the Regulation Z disclosures are furnished to the borrower.

(g)

In the event federal law is amended so that this section is inconsistent therewith, the federal law shall prevail as to the disclosures required by this section.

Source: Section 1917.712, https://leginfo.­legislature.­ca.­gov/faces/codes_displaySection.­xhtml?lawCode=CIV§ionNum=1917.­712.­ (updated Jan. 1, 1984; accessed Jun. 30, 2025).

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Verified:
Jun. 30, 2025

§ 1917.712's source at ca​.gov