HARRY HUGHES, Governor                              3873

residence may create a balloon payment at maturity of the
deferred purchase money mortgage, if the balloon payment is:

(i) Expressly disclosed to the borrower;
and

(ii) Agreed to by both the borrower and
the lender/seller in writing.

(3) A lender who takes back a deferred purchase
money secondary mortgage on a borrower's present residence
to aid the borrower in the purchase of a new residence may
create a balloon payment if the balloon payment is:

(i) Expressly disclosed to the borrower;
and

(ii) Agreed to by both the borrower and
lender in writing.

(D) NOTWITHSTANDING THE PROVISIONS OF SUBSECTIONS (A)
AND, (B), AND (C) OF THIS SECTION, ON ANY LOAN MADE ON OR
AFTER JULY 1, 1982, AND BEFORE JULY 1, 1985, A LENDER UNDER
THIS SUBTITLE MAY CHARGE INTEREST NOT EXCEEDING 24 PERCENT
PER ANNUM SIMPLE INTEREST ON THE LOAN PROVIDED THAT:

(1)  THE INTEREST IS COMPUTED ON THE ACTUAL
UNPAID PRINCIPAL BALANCES OUTSTANDING FROM TIME TO TIME; AND

(2)  THE LENDER DOES NOT CONTRACT FOR, CHARGE OR
RECEIVE ANY INTEREST IN ADVANCE OR ANY COMPOUNDED
INTEREST . ;

(3) IF THE LOAN IS A RENEWAL OR REFINANCING OF A
LOAN MADE PRIOR TO JULY 1, 1982, THE LENDER COMPLIES WITH
SECTION 12-116 OF THIS TITLE;

(4) IF THE LOAN INCLUDES A PROVISION FOR A RATE
OF INTEREST WHICH MAY BE ADJUSTED BY THE LENDER DURING THE
TERM OF THE LOAN, THE LENDER COMPLIES WITH SECTION 12-118 OF
THIS TITLE; AND

(5) IF THE LOAN IS FOR THE PURCHASE OF CONSUMER
GOODS, THE LOAN CONTRACT COMPLIES WITH SECTION 12-117 OF
THIS TITLE.

12-505.

(a) In a closed end account, the finance charge may
not exceed the greater of:

(1) An amount computed using the following
annual simple interest rates of finance charge:

(i) 22 percent on that part of the
outstanding balance not exceeding $1,000; and