§ 34-25.2-5. Prohibited acts and practices regarding home loans.
A home loan shall be subject to the following prohibited acts and practices.
(a) No creditor making a home loan shall finance, directly or indirectly, any credit life,
credit disability, credit unemployment or credit property insurance, or any other
life or health insurance, or any payments directly or indirectly for any debt cancellation
or suspension agreement or contract, except that insurance premiums or debt cancellation
or suspension fees calculated and paid in full on a monthly basis shall not be considered
financed by the creditor.
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§ 34-25.2-5. Prohibited acts and practices regarding home loans.
A home loan shall be subject to the following prohibited acts and practices.
(a) No creditor making a home loan shall finance, directly or indirectly, any credit life,
credit disability, credit unemployment or credit property insurance, or any other
life or health insurance, or any payments directly or indirectly for any debt cancellation
or suspension agreement or contract, except that insurance premiums or debt cancellation
or suspension fees calculated and paid in full on a monthly basis shall not be considered
financed by the creditor.
(b) No creditor shall knowingly or intentionally engage in the unfair act or practice
of flipping a home loan. "Flipping a home loan� is the making of a home loan to a
borrower that refinances an existing home loan that was consummated within the prior
sixty (60) months when the new loan does not have reasonable, tangible net benefit
in accordance with subsection 34-25.2-4(q), to the borrower considering all of the circumstances, including, but not limited
to, the terms of both the new and refinanced loans, the cost of the new loan, and
the borrower's circumstances.
(c) No creditor shall recommend or encourage default on an existing loan or other debt
prior to and in connection the closing or planned closing of a home loan that refinances
all or any portion of such existing loan or debt.
(d) No home loan may contain a provision that permits the creditor, in its sole discretion,
to accelerate the indebtedness. This provision does not prohibit acceleration of the
loan in good faith due to the borrower's failure to abide by the material terms of
the loan.
(e) No home loan may contain a provision that allows a party to require a borrower to
assert any claim or defense in a forum that 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 or limits
in any way claim or defense the borrower may have.