Required loan disclosures

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  • (a)

    • (1) A licensee who offers to make or procure a loan secured by a first or subordinate mortgage on a single to four-family home to be occupied by the borrower shall provide the borrower with a financing agreement executed by the lender.

    • (2) The financing agreement shall provide:

      • (A) The term and principal amount of the loan;

      • (B) An explanation of the type of mortgage loan being offered;

      • (C) The rate of interest that will apply to the loan and, if the rate is subject to change, or is a variable rate, or is subject to final determination at a future date based on some objective standard, a specific statement of those facts; provided that loans under $100,000 shall comply with the territory's usury laws.

      • (D) The points and all fees, if any, to be paid by the borrower or the seller, or both; and

      • (E) The term during which the financing agreement remains in effect.

    • (3) If all the provisions of the financing agreement are not subject to future determination, change, or alteration, the financing agreement shall constitute a final binding agreement between the parties as to the items covered by the financing agreement.

  • (b)

    • (1) The financing agreement executed by the lender must be delivered to the borrower at least 72 hours before the time of settlement agreed to by the parties and must include:

      • (A) The effective fixed interest rate or initial interest rate that will be applied to the loan; and

      • (B) A restatement of all the remaining unchanged provisions of the financing agreement.

    • (2) Prior to execution of the financing agreement, the borrower may waive in writing the 72-hour advance presentation requirement and accept the commitment at settlement only if compliance with the 72-hour requirement is shown by the lender to be infeasible.

    • (3) A borrower aggrieved by any violation of this section shall be entitled to bring a civil suit for damages, including reasonable attorney's fees, against the lender.


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