§ 28-15-11-16 — Regulation of rollover mortgage loans

Rollover mortgage loans are subject to the
following:
(1) At each scheduled adjustment time, if the loan is not in
default, the lender shall make rate adjustments available for the
amount of the outstanding loan.
(2) In adjusting the loan, administrative expenses may not be
charged to the borrower.
(3) Adjustments must be at least one (1) year apart.
(4) The lender may not charge a penalty or other assessment for
the prepayment of the loan.
(5) The lender and the borrower may agree to increase or decrease
the interest rate applicable to the outstanding balance of the loan
at each adjustment.
(6) The lender may grant the borrower the option of extending the
amortization period for purposes of calculating monthly payments
on the loan in accordance with the following rules:
(A) The extension of the amortization period may equal up to
one-third (1/3) of the original amortization period, regardless of
whether this extends the amortization period beyond thirty (30)
years.
(B) To the extent of any extension of the amortization period,
the amortization period will be reduced upon a subsequent
downward adjustment in the interest rate.

Legislative History

As added by P.L.193-1997, SEC.2.