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LAWS OF MARYLAND

[Ch. 49

REVISOR'S NOTE: This section is new language derived
without substantive change from Art. 66, §67.

For provisions generally relating to
advertising and other representations made in
connection with the extension of "consumer
credit," see Title 13 of this article, the
Maryland Consumer Protection Act.

12-404. AMOUNT OF LOAN; INTEREST; PAYMENT IN
INSTALLMENTS.

(A)   AMOUNT OF LOAN; INTEREST IN ADVANCE.
A LENDER MAY:

(1)    MAKE A LOAN IN SUCH AN AMOUNT THAT THE
NET PROCEEDS OF THE LOAN EQUAL A PREDETERMINED SUM; AND

(2)   TAKE INTEREST IN ADVANCE ON THE FULL
AMOUNT OF THE LOAN FOR THE PERIOD FROM THE DATE THE LOAN
IS MADE TO THE DATE OF MATURITY OF THE FINAL INSTALLMENT.

(B)   LIMITATION ON TOTAL AMOUNT OF INTEREST.

THE TOTAL AMOUNT OF INTEREST MAY NOT EXCEED THE
AMOUNT THAT WOULD ACCRUE THROUGHOUT THE TERM OF THE LOAN
IF CHARGED AT THE RATE OF 12 PERCENT PER ANNUM ON THE
UNPAID PRINCIPAL BALANCES OUTSTANDING FROM TIME TO TIME.

(C)   AMORTIZATION OF LOAN.

A LOAN SHALL BE AMORTIZED IN EQUAL OR SUBSTANTIALLY
EQUAL MONTHLY INSTALLMENTS WITHOUT A BALLOON PAYMENT AT
MATURITY, EXCEPT THAT:

(1)   PAYMENT ON THE LOAN MAY BE REDUCED OR
SUSPENDED UNTIL [[THE FIRST LIEN OR ENCUMBRANCE IS]] ALL
PRIOR LIENS OR ENCUMBRANCES ARE WHOLLY OR PARTIALLY
SATISFIED; AND

(2)    A BALLOON PAYMENT AT MATURITY MAY BE
REQUIRED IF THE LOAN IS TRANSACTED SOLELY FOR THE PURPOSE
OF ACQUIRING OR CARRYING ON A BUSINESS OR COMMERCIAL
INVESTMENT.

REVISOR'S NOTE: This section presently appears as
Art. 66, §61(a).

In subsection (b) of this section, for
purposes of brevity and conformity, the phrase
"unpaid principal balances outstanding from
time to time" is substituted for "at the end
of each installment period on the descending