Section 408.234

Title XXVI TRADE AND COMMERCE

Chapter 408

Effective - 28 Aug 2021, 2 histories   

  408.234.  Collateral — prepayment rights, method of computation. — 1.  A lender may take a security interest in any collateral in conjunction with residential real estate in connection with a second mortgage loan.

  2.  The borrower shall have an unconditional right to prepay any second mortgage loan.  If any such loan providing for interest being added to the principal is prepaid in full one month or more before the final installment date, the lender shall recompute the amount of interest earned to the date of prepayment in full on the basis of the rate of interest originally contracted for computed on the actual unpaid principal balances for the time actually outstanding.

  3.  When fees charged need not be disclosed in the annual percentage rate required by Title 15, U.S.C. Sections 1601, et seq., and regulations thereunder because such fees are deminimus amounts or for other reasons, such fees need not be included in the annual percentage rate for state examination purposes.

­­--------

(L. 1979 S.B. 305, A.L. 1980 H.B. 1195, A.L. 1981 S.B. 5 Revision, A.L. 1994 H.B. 1312 merged with S.B. 718, A.L. 2000 S.B. 896, A.L. 2021 S.B. 106)