Section 432.045

Title XXVIII CONTRACTS AND CONTRACTUAL RELATIONS

Chapter 432

Effective - 28 Aug 1992   

  432.045.  Credit agreements, defined — action by debtor on certain credit agreements prohibited unless in writing — contents of written statement requirement — oral modification permitted, when. — 1.  For the purposes of this section, the term "credit agreement" means an agreement to lend or forbear repayment of money, to otherwise extend credit, or to make any other financial accommodation.

  2.  A debtor may not maintain an action upon or a defense to a credit agreement unless the credit agreement is in writing, provides for the payment of interest or for other consideration, and sets forth the relevant terms and conditions, except this subsection shall not preempt other specific statutes that authorize additional protection for consumer credit used in personal, family or household purposes and the limitations on credit agreements in subsection 3 of this section.

  3.  (1)  If a written credit agreement has been signed by a debtor, subsection 2 of this section shall not apply to any credit agreement between such debtor and creditor unless such written credit agreement contains the following language in boldface ten point type:

"Oral agreements or commitments to loan money, extend credit or to forbear from enforcing repayment of a debt including promises to extend or renew such debt are not enforceable.  To protect you (borrower(s)) and us (creditor) from misunderstanding or disappointment, any agreements we reach covering such matters are contained in this writing, which is the complete and exclusive statement of the agreement between us, except as we may later agree in writing to modify it."

  (2)  The provisions of this section shall not apply to credit agreements for personal, family, or household purposes when there is already a written contract governing the transaction, and the debtor and creditor orally agree to defer one or more loan payments or make other credit agreement modifications and such deferrals or modifications are limited in duration to not more than ninety days.

  4.  Nothing contained in this section shall affect the enforceability by a creditor of any promissory note, guaranty, security agreement, deed of trust, mortgage, or other instrument, agreement, or document evidencing or creating an obligation for the payment of money or other financial accommodation, lien, or security interest.

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(L. 1990 H.B. 1788, A.L. 1992 S.B. 688)