Sec. 36a-760e. Restrictions on provisions in nonprime home loans. - Connecticut Statutes

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Statutes > Connecticut > Title36a > Chap669 > Sec36a-760e

      Sec. 36a-760e. Restrictions on provisions in nonprime home loans. (a) A lender shall not offer a nonprime home loan that contains:

      (1) A prepayment penalty, except that this prohibition shall not apply to FHA loans;

      (2) A provision that increases the interest rate after default other than a failure to comply with a provision to maintain an automatic electronic payment feature where that maintenance provision has been provided in return for an interest rate reduction and the increase is no greater than that reduction;

      (3) A provision requiring a borrower, whether acting individually or on behalf of others similarly situated, to assert any claim or defense in a nonjudicial forum that: (A) Utilizes principles which are inconsistent with the law as set forth in the general statutes or common law; (B) limits any claim or defense the borrower may have; or (C) is less convenient, more costly or more dilatory for the resolution of a dispute than a judicial forum established in this state where the borrower may otherwise properly bring a claim or defense.

      (b) If a nonprime home loan contains a provision which violates subdivision (1), (2) or (3) of subsection (a) of this section, that provision shall be void and unenforceable.

      (P.A. 08-176, S. 26.)

      History: P.A. 08-176 effective July 1, 2008.

State Codes and Statutes

Statutes > Connecticut > Title36a > Chap669 > Sec36a-760e

      Sec. 36a-760e. Restrictions on provisions in nonprime home loans. (a) A lender shall not offer a nonprime home loan that contains:

      (1) A prepayment penalty, except that this prohibition shall not apply to FHA loans;

      (2) A provision that increases the interest rate after default other than a failure to comply with a provision to maintain an automatic electronic payment feature where that maintenance provision has been provided in return for an interest rate reduction and the increase is no greater than that reduction;

      (3) A provision requiring a borrower, whether acting individually or on behalf of others similarly situated, to assert any claim or defense in a nonjudicial forum that: (A) Utilizes principles which are inconsistent with the law as set forth in the general statutes or common law; (B) limits any claim or defense the borrower may have; or (C) is less convenient, more costly or more dilatory for the resolution of a dispute than a judicial forum established in this state where the borrower may otherwise properly bring a claim or defense.

      (b) If a nonprime home loan contains a provision which violates subdivision (1), (2) or (3) of subsection (a) of this section, that provision shall be void and unenforceable.

      (P.A. 08-176, S. 26.)

      History: P.A. 08-176 effective July 1, 2008.

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State Codes and Statutes

Statutes > Connecticut > Title36a > Chap669 > Sec36a-760e

      Sec. 36a-760e. Restrictions on provisions in nonprime home loans. (a) A lender shall not offer a nonprime home loan that contains:

      (1) A prepayment penalty, except that this prohibition shall not apply to FHA loans;

      (2) A provision that increases the interest rate after default other than a failure to comply with a provision to maintain an automatic electronic payment feature where that maintenance provision has been provided in return for an interest rate reduction and the increase is no greater than that reduction;

      (3) A provision requiring a borrower, whether acting individually or on behalf of others similarly situated, to assert any claim or defense in a nonjudicial forum that: (A) Utilizes principles which are inconsistent with the law as set forth in the general statutes or common law; (B) limits any claim or defense the borrower may have; or (C) is less convenient, more costly or more dilatory for the resolution of a dispute than a judicial forum established in this state where the borrower may otherwise properly bring a claim or defense.

      (b) If a nonprime home loan contains a provision which violates subdivision (1), (2) or (3) of subsection (a) of this section, that provision shall be void and unenforceable.

      (P.A. 08-176, S. 26.)

      History: P.A. 08-176 effective July 1, 2008.