33-742

33-742. Forfeiture of interest of purchaser in
default under contract

A. If a purchaser is in default by failing to pay monies due under the contract, a
seller may, after expiration of the applicable period stated in subsection D of this
section and after serving the notice of election to forfeit stated in section 33-743,
complete the forfeiture of the purchaser's interest in the property in the manner
provided by section 33-744 or 33-745. If the contract provides that the seller may elect
to accelerate the principal balance due under the contract to the seller on the
purchaser's failure to pay the monies due, the seller may accelerate the principal
balance due to the seller at any time after the purchaser has failed to pay the monies
due under the contract. The acceleration may occur before or after the expiration of the
applicable period stated in subsection D of this section and without serving the notice
of election to forfeit stated in section 33-743. If the seller elects to accelerate the
principal balance due to the seller, the seller may only foreclose the contract as a
mortgage in the manner provided by section 33-748. If a purchaser is in default under
the contract for reasons other than failing to pay monies due under the contract, the
seller may only foreclose the contract as a mortgage in the manner provided by section
33-748.

B. The interest of a purchaser in any personal property included in a contract is
subject to forfeiture or foreclosure in the same manner as the real property, except that
forfeiture or foreclosure does not affect or impair the rights of a holder of a security
interest whose interest in the personal property is not subordinate to that of the
seller.

C. If a contract provides that time is of the essence, a waiver of that provision
occurs only if the seller has accepted monies due under the contract in an amount which
is less than the total monies due under the contract at the time of the
acceptance. Receipt of any monies due under the contract by an account servicing agency
does not constitute acceptance by the seller. A seller's delay in exercising any remedy
granted either by the contract or by law does not constitute a waiver of a time is of the
essence provision. If the time of the essence provision has been waived, the seller may
reinstate the provision by serving a written notice on the purchaser and the account
servicing agent, if one has been appointed, requiring strict performance of the
purchaser's obligations to pay monies due under the contract. The notice shall be
served, either by delivery in person or deposit in the United States mail, first class,
postage prepaid, at least twenty days prior to the date on which the seller will require
the purchaser to pay the monies due under the contract. A copy of the notice need not be
recorded in the county in which the real property is located or served on any person
other than the purchaser and the account servicing agent, if one has been appointed.

D. Forfeiture of the interest of a purchaser in the property for failure to pay
monies due under the contract may be enforced only after expiration of the following
periods after the date such monies were due:

1. If there has been paid less than twenty per cent of the purchase price, thirty
days.

2. If there has been paid twenty per cent, or more, but less than thirty per cent
of the purchase price, sixty days.

3. If there has been paid thirty per cent, or more, but less than fifty per cent of
the purchase price, one hundred and twenty days.

4. If there has been paid fifty per cent, or more, of the purchase price, nine
months.

E. For the purpose of computing the percentage of the purchase price paid under
subsection D of this section, the total of only the following constitutes payments on the
purchase price:

1. Down payments paid to the seller.

2. Principal payments paid to the seller on the contract.

3. Principal payments paid to other persons who hold liens or encumbrances on the
property, the principal portion of which constitutes a portion of the purchase price, as
stated under the contract.