If a lender expressly agrees in writing with a subsequent debtor to accept that debtor as a primary obligor on an existing transaction in which a mortgage, deed of trust, or equivalent consensual security interest was created or retained in the original debtor's principal dwelling to finance the acquisition or initial construction of it, before the assumption occurs the lender shall make new disclosures to the subsequent debtor based on the remaining obligation. If the finance charge originally imposed on the existing obligation was an add-on or discount finance charge, the lender need only disclose the unpaid balance of the obligation assumed; the total charges imposed by the lender in connection with the assumption; the information required in the case of new disclosures concerning prepayment, late payment, security interests and to exclude premiums for consumer credit and property and liability insurance from the finance charge; the annual percentage rate originally imposed on the obligation; and the payment schedule and total of payments based on the remaining obligation.
Added by Laws 1969, c. 352, § 3-308, eff. July 1, 1969. Amended by Laws 1982, c. 335, § 42, operative Oct. 1, 1982.