Iowa § 528.4 Prepayment penalty prohibited

Iowa Statutes

§ 528.4 — Prepayment penalty prohibited

Iowa § 528.4

Title XIIICOMMERCE

Ch. 528ALTERNATIVE MORTGAGE LOANS

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Bluebook

Iowa Code § 528.4 (2026).

Text

A financial institution making an alternative mortgage loan may contract with the
mortgagor for interest to be paid currently or to accrue, and if accrued, for accrued interest
to be added to the mortgage debt on which interest may be charged and collected. Accrued
interest which is added to the mortgage debt shall be secured by the mortgage to the same
extent as the principal of the alternative mortgage loan. An instrument evidencing an
alternative mortgage loan shall not contain a provision imposing a penalty for prepayment
of the loan.

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A financial institution making an alternative mortgage loan may contract with the
mortgagor for interest to be paid currently or to accrue, and if accrued, for accrued interest
to be added to the mortgage debt on which interest may be charged and collected. Accrued
interest which is added to the mortgage debt shall be secured by the mortgage to the same
extent as the principal of the alternative mortgage loan. An instrument evidencing an
alternative mortgage loan shall not contain a provision imposing a penalty for prepayment
of the loan.