Louisiana House Bill HR171

Louisiana 2010 Regular Session

• Introduced: 6/15/10
• Passed: 6/16/10

Caption

Urges and requests the La. office of financial institutions to study the use of notice of deferment options given by lending institutions to borrowers during gubernatorially declared emergenices

Impact

The bill intends to address the practices of lenders regarding deferments amid emergencies such as natural disasters. By requesting the Louisiana Office of Financial Institutions to explore potential minimum notice requirements, HR171 aims to create a more transparent lending environment. The result could enable borrowers to navigate financial challenges more effectively by providing them with clarity on their obligations during deferments. If the office issues recommended policies based on the study, it could lead to a more standardized approach to borrower communications across lending institutions in the state.

Summary

House Resolution 171 urges and requests the Louisiana Office of Financial Institutions to study the use of notices of deferment options provided by lending institutions to borrowers during gubernatorially declared emergencies. This resolution highlights the importance of clear communication regarding deferment terms, which would inform borrowers about when their payments would resume and whether any lump sum payments would be required thereafter. The resolution implies that such guidance is essential for ensuring that borrowers are not unduly surprised or burdened by the terms of their mortgage during critical times.

Sentiment

Overall, the sentiment surrounding HR171 appears to be supportive, as it aims to protect borrowers during emergencies. Stakeholders recognize the necessity for lenders to have discretion over deferments; however, they also emphasize the importance of providing clear and adequate notice to ensure borrower understanding. The resolution does not propose direct regulation but instead seeks to encourage best practices among financial institutions, fostering an environment of trust and responsibility.

Contention

While no significant points of contention were noted in the available discussions, the underlying principle behind HR171 raises some broader questions about the balance between lender discretion and borrower protection. It is critical to ensure that while lenders maintain flexibility in granting deferments, they must also uphold transparent communication to empower borrowers. As the resolution does not mandate specific actions but rather encourages further study, one potential area of debate could arise from differing opinions on the necessity and scope of such guidelines.