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1999 SESSION

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SB 468 Private mortgage insurance; termination.

Introduced by: Frederick M. Quayle | all patrons    ...    notes | add to my profiles

SUMMARY AS INTRODUCED:

Banking and finance; private mortgage insurance; termination. Establishes criteria terminating private mortgage insurance by operation of law. The bill requires lenders of mortgage loans to disclose to borrowers in writing at or before settlement the conditions and procedures for termination of private mortgage insurance. The borrower's obligation to make payments for private mortgage insurance terminates when the principal balance outstanding on all residential mortgages securing the property is equal to or less than 75 percent of either (i) the sales price of the property when purchased, (ii) the appraised value of the property as determined by the appraisal performed in connection with the making of the loan, or (iii) the appraised value of the property as determined by an appraisal performed at any time after the making of the loan. These automatic termination provisions do not apply to (i) mortgage loans on which the payments are not current, (ii) mortgage loans for which the borrower has been assessed more than one late penalty in the 12-month period preceding cancellation, (iii) mortgage loans executed before July 1, 1998, or (iv) loans funded in whole or part pursuant to a statute or regulation that prohibits or limits termination of payments for private mortgage insurance.


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