US 2004 Enacted Predatory Mortgage & Subprime Lending Legislation Resources in United States
US 2004 Enacted Predatory Mortgage & Subprime Lending Legislation Resources
| State: | Bill Summary: |
| Indiana | H.B. 1229 Signed by governor 3/17/04, Public Law 73 Establishes the Homeowner Protection Unit in the office of the attorney general. Provides enforcement procedures for deceptive mortgage acts. Establishes a $3 mortgage recording fee. Requires the Department of Commerce to provide home ownership education programs. Provides that certain provisions do not apply to certain financial institutions. Prohibits certain lending practices. Updates references in financial institutions law to conform with federal law. Permits a state chartered financial institution to engage in activities related to a product, a service, or an investment that is available to or offered by national banks domiciled in Indiana. Provides that state law applies to a state chartered bank, trust company, savings association, savings bank, credit union, corporate fiduciary, or industrial loan and investment company to the same extent it applies to a federally chartered institution of the same type. Establishes administrative procedures governing requests for an exemption from state law due to the preemption of state law as it is applied to federally chartered institutions. Prohibits a lender from requiring a borrower to obtain hazard insurance in an amount exceeding the replacement value of the improvements on mortgaged property as a condition of receiving or maintaining the mortgage. Voids provisions in an agreement to purchase a security that would waive compliance with securities law or a rule or order made under securities law. Provides a procedure for an issuer of securities to respond to comments regarding an application for registration made by the securities division. Permits the appointment of a securities division attorney to serve as a special deputy prosecutor in actions arising under securities law. Exempts persons engaged in certain federally regulated transactions from the requirements of the loan broker law. |
| Louisiana | H.C.R. 107 Filed with secretary of state 6/22/04 Creates the Predatory Lending Prevention Task Force to study the conditions in the Louisiana housing finance market and address the issues and concerns relative to protecting Louisiana citizens from predatory lending practices. |
| S.C.R. 121 Filed with secretary of state 6/22/04 Requests the House Committee on Commerce and the Senate Committee on Commerce, Consumer Protection, and International Affairs to meet and function as a joint committee to study the conditions in the Louisiana housing finance market and address the issues and concerns relative to protecting Louisiana citizens from predatory lending practices. |
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| Massachusetts | H.B. 4880 Signed by governor 8/9/04, Chapter 268 Prohibits certain practices in home mortgage lending. |
| Missouri | H.B. 1291 Signed by governor 6/25/04 Prohibits a lender of a residential mortgage from requiring a borrower to purchase homeowners’ insurance coverage in an amount exceeding the replacement value of the home and its contents. |
| S.B. 1086 Signed by governor 6/25/04 Restricts lenders from requiring borrowers to obtain homeowners insurance in an amount exceeding the replacement value of the improvements and contents of the real property as a condition of financing a residential mortgage. A violation of this provision shall not affect the validity of the loan, note secured by a deed of trust, mortgage, or deed of trust. |
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| New Hampshire | S.B. 99 Signed by governor 5/24/04, Chapter 140 Regulates certain mortgage loans and mortgage loan practices. |
| New Jersey | S.B. 279 Signed by governor 7/6/04, Chapter 84 Makes certain revisions to the New Jersey Home Ownership Security Act of 2002, which prohibits certain abusive lending practices commonly known as predatory lending. Removes the category of “covered home loan” from the act’s provisions and reduces the “total points and fees threshold” for high-cost home loans from five percent to 4.5 percent. Clarifies the definition of “points and fees” to provide that prepayment fees and penalties incurred by a borrower in the refinancing of a loan shall not be included in the calculation of points and fees when the new loan refinances a previous loan made by the same broker, but funded by another creditor. Eliminates the current prohibition on “flipping” contained in the act. An amendment is made to the act’s findings and declarations to make it clear that the elimination of the category of covered home loans from the act, and the elimination of the prohibition on “flipping,” shall not create a presumption that any home loan that has been refinanced is not unconscionable, nor any presumption that any home loan that is refinanced does not constitute an unlawful practice under the consumer fraud law. Extends, from 90 days to one year of the loan closing, but still prior to any notice from the borrower, the grace period for detection and adjustment of certain unintentional compliance failures, whereby the creditor is deemed not to have violated the act as long as restitution is provided and certain other actions taken. Adds a provision to reinforce that actions brought against purchasers or assignees of high-cost home loans who qualify for the “safe harbor” from unlimited liability provision of the act can only be asserted by a borrower in an individual capacity and may not be asserted against the purchaser or assignee in a class action. Under the “safe harbor” provision, a purchaser or assignee can qualify for protection from class actions and the full range of damages by expressly adopting policies that prohibit the purchase or acceptance of high-cost home loans and taking specific steps to implement such policies. Expands the current regulatory authority of the commissioner of Banking and Insurance to provide that the commissioner, in consultation and collaboration with the director of the Division of Consumer Affairs in the Department of Law and Public Safety, shall have authority to promulgate regulations to effectuate the entirety of the act’s provisions, rather than only certain provisions. |
| New Mexico | S.B. 228 Signed by governor 2/27/04, Chapter 13 Repeals a section of the Home Loan Protection Act concerning claims against certain persons. |
| Tennessee | H.B. 3377 Substituted by S.B. 3358 5/12/04 S.B. 3358 Signed by governor 5/24/04, Public Chapter 746 Extends reporting deadline of special joint committee created to perform comprehensive analysis of predatory lending from February 28, 2004, to May 1, 2005. Amends Chapter 316 of the Public Acts of 2003 and Chapter 871 of the Public Acts of 2002. |
| Utah | H.B. 160 Signed by governor 3/22/04, Public Law Chapter 252 Creates the Utah High Cost Home Loan Act; provides definitions; enacts provisions regarding prepayment penalties; places restrictions on financing of points and fees; places restrictions on the arbitration clause; prohibits single premium credit life insurance; places limitations on refinancing; and requires the lender to provide the borrower a full copy of all documents pertaining to the transaction. |
| Wisconsin | A.B. 792 Signed by governor 4/15/04, Act 257 Creates the Responsible High Cost Mortgage Lending Act. |
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