HARRY HUGHES, Governor

3799

FOR the purpose of making certain provisions governing the amount
of interest and other charges that may be charged for
certain loans secured by residential real property
applicable to certain refinancing loans under certain
conditions; providing exemptions for certain loans, certain
lenders and credit grantors; deleting obsolete provisions;
and generally relating to the amount of interest and other
charges that may be received on loans secured by a first
mortgage or first deed of trust or any interest in
residential real property.

BY repealing and reenacting, with amendments,

Article - Commercial Law

Section 12-103(b)

Annotated Code of Maryland

(1983 Replacement Volume and 1985 Supplement)

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

Article - Commercial Law

12-103.

(b) (1) A lender may charge interest at any effective rate
of simple interest on the unpaid principal balance of a loan if:

(i) There is a written agreement signed by the
borrower which sets forth the stated rate of interest charged by
the lender;

(ii) The loan is secured by a first mortgage or
first deed of trust on any interest in residential real property;

(iii) There is no prepayment penalty in
connection with the loan;

(iv) The loan is made and the mortgage or deed
of trust is executed after the effective date of this section;
AND

[(v) The loan is not a renewal of a loan which
was made by the lender to the borrower before the effective date
of this section and which was secured by a mortgage or deed of
trust on the same property; and

(vi) The lender did not issue before the
effective date of this section, a written commitment agreeing to
make the loan at a rate of interest of 10 percent or less.

(2) For purposes of paragraph (l)(vi) of this
subsection: