HARRY HUGHES, Governor

5

[(b) Notwithstanding the provisions of subsection (a),
a lender may charge points on a mortgage loan which is not
insured or guaranteed by an agency or instrumentality of the
United States government if

(1) The loan is eligible for purchase by an
agency or instrumentality of the United States government,
or a subsidiary thereof, pursuant to the Emergency Home
Purchase Assistance Act of 1974 (PL93 449) or any amendment
to it, and is tendered in good faith for purchase pursuant
to a commitment obtained by the lender from such an agency,
instrumentality, or subsidiary, and

(2) The federal law, rules, or regulations
under which the agency, instrumentality, or subsidiary is
authorized to purchase the loan allows the payment of
points, and the points charged and the interest rate on the
loan are not in excess of those allowed under the federal
program.

(c) Notwithstanding the provisions of subsection (a)
of this section, a lender may impose and collect, as a
condition of making a loan, all fees, discounts, points, or
other charges that lenders are permitted or required to
impose, collect, or pay pursuant to a federal or Maryland
law providing for a program of mortgage purchases (exclusive
of the Maryland Home Finance Authority) OR LOANS ORIGINATED
PURSUANT TO A STATE OR LOCAL GOVERNMENTAL PROGRAM OF DIRECT
LENDING OR MORTGAGE PURCHASE, or by any federal agency or
instrumentality or subsidiary thereof, including but not
limited to, Government National Mortgage Association,
Federal National Mortgage Association, Federal Home Loan
Mortgage Corporation, federal reserve bank, federal home
loan bank and the Farmers Home Administration, provided that
all of the following conditions are met:

(1)       The loan is eligible for purchase by, and
is tendered in good faith, for purchase, pursuant to a
commitment or offer to purchase by the federal, STATE, OR
LOCAL GOVERNMENTAL agency, instrumentality, or subsidiary;

(2)       The fees, discounts, points, or other
charges imposed, and the interest rate on the loan, do not
exceed those allowed by the applicable federal or Maryland
law providing for the mortgage purchase program; AND

(3) The rate of interest on the loan, computed
in accordance with this article by taking into account those
fees, discounts, points, and other charges which are deemed
interest, does not exceed an effective rate of simple
interest of 10 percent per annum provided by § 12-103 (b) on
the unpaid balance, and

(4) (3) Not more than one point is charged to
the borrower, unless the federal law specifies a higher
limit on points which may be charged to the borrower.-]-