S.B. 209                                                  VETOES

(c) (1) THIS SUBSECTION DOES NOT APPLY TO AN EXTENSION OF CREDIT
OR LOAN MADE BY A CREDIT UNION ON OR AFTER OCTOBER 1, 1994.

(2) A loan under this section that is secured by a first mortgage may be
made at any rate of interest that does not exceed the rate authorized by Title 12, Subtitle
1 of the Commercial Law Article for mortgage loans.

[(2)](3) A loan under this section that is secured by a second mortgage may
be made at any rate of interest that does not exceed the rate authorized by Title 12,
Subtitle 4 of the Commercial Law Article.

6-507.

(A) THIS SECTION DOES NOT APPLY TO AN EXTENSION OF CREDIT OR LOAN
MADE BY A CREDIT UNION ON OR AFTER OCTOBER 1, 1994.

[(a)](B) Except as otherwise expressly provided in this title, a credit union may
not charge interest on any loan to a member at a rate of more than [1.5] 2 percent a
month on the unpaid balance.

[(b) (C) Notwithstanding the provisions of subsection (a) of this section, a credit
union may charge interest on a loan to a member made on or after July 1, 1982, at 2
percent a month on the unpaid balance provided, with respect to such loan, that:

(1)     If the loan is a renewal or refinancing of a loan made prior to July 1,
1982, the lender complies with § 12-116 of the Commercial Law Article;

(2)     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 § 12-118 of
the Commercial Law Article;

(3)     Upon the borrower's default, if the loan is secured by personal property,
the lender complies with § 12-115 of the Commercial Law Article concerning
repossession and redemption of the goods securing the loan;

(4)     If the loan is for the purchase of consumer goods, the loan contract
complies with § 12-117 of the Commercial Law Article; and

   (5) The loan does not include a balloon payment, unless payment in full is
due on demand or in 1 year or less.]

6-510.

(a)     A borrower from a credit union may prepay all or part of a loan on any day on
which the office of the credit union is open.

(b)     (1) Subject to the provisions of paragraph (2) of this subsection, if a member
of a credit union fails to repay as due a loan made by the credit union, the credit union
may impose any fine or other penalty for which the bylaws provide.

- 3492 -