HARRY HUGHES, Governor

2859

Article - Commercial Law

Section 12-404(c)(2)(iii)

Annotated Code of Maryland

(1983 Replacement Volume and 1984 Supplement)

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF
MARYLAND, That the Laws of Maryland read as follows:

Article - Commercial Law

12-404.

(c) A loan shall be amortized in equal or substantially
equal monthly installments without a balloon payment at maturity,
except that:

(2) A lender, including a seller who takes a mortgage
or deed of trust to secure payment of all or a portion of the
purchase price of a residence sold to a borrower, may make a loan
for the purpose of aiding the borrower in the sale of the
borrower's residence or the purchase of a new residence, and may
create a balloon payment at maturity of this loan if the balloon
payment is:

(iii) Required to be postponed one time, upon
becoming due, at the borrower's request, for a period NOT LONGER
THAN THE ORIGINAL TERM OF THE LOAN, not to exceed 24- 6 months,
provided that the borrower continues to make the monthly
installments provided for in the original loan agreement, and no
new closing costs, processing fees or similar fees are imposed on
the borrower as a result of the extension. However, the
if requirement of this subparagraph does not apply if the loan terms
require payment in full within 12 months or less, except that a
borrower may postpone payment of the balloon payment once for a
period not to exceed 6 months and if, during the extension
period, the borrower continues to make payments in the amount
required prior to maturity, the lender may not impose any charges
or fees as a result of the extension period.

SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall
take effect July 1, 1985.

Approved May 28, 1985.

CHAPTER 598
(House Bill 208)
AN ACT concerning