§ 24-4.5-3-402 — Balloon payments; compliance with Alternative Mortgage Transaction Parity Act

(1) This section does not apply to a first
lien mortgage transaction.
(2) Except as provided in IC 24-9-4-3 with respect to a high cost
home loan (as defined in IC 24-9-2-8), with respect to a consumer loan,
other than one pursuant to a revolving loan account or one on which
only loan finance charges are payable prior to the time that the final
scheduled payment is due, if any scheduled payment is more than twice
as large as the average of earlier scheduled payments, the debtor has
the right to refinance the amount of that payment at the time it is due
without penalty. The terms of the refinancing shall be no less favorable
to the debtor than the terms of the original loan. This section does not
apply to the extent that the payment schedule is adjusted to the seasonal
or irregular income of the debtor.
(3) For the purposes of this section, "terms of the refinancing"
means:
(a) in the case of a fixed-rate consumer loan, the individual
payment amounts, the charges as a result of default by the debtor,
and the rate of the loan finance charge; and
(b) in the case of a variable rate consumer loan, the method used
to determine the individual payment amounts, the charges as a
result of default by the debtor, the method used to determine the
rate of the loan finance charge, the circumstances under which the
rate of the loan finance charge may increase, and any limitations
on the increase in the rate of the loan finance charge.
(4) If a consumer loan is made under the authority of the Alternative
Mortgage Transaction Parity Act (12 U.S.C. 3802 et seq.), the note
evidencing the mortgage must contain a reference to the applicable
federal law.
Formerly: Acts 1971, P.L.366, SEC.4. As amended by
P.L.247-1983, SEC.19; P.L.213-2007, SEC.9; P.L.217-2007, SEC.8;
P.L.90-2008, SEC.8.