MD
Maryland House Bill HB1150

Maryland 2023 Regular Session

Maryland House Bill HB1150 Compare Versions

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1- WES MOORE, Governor Ch. 568
21
3-– 1 –
4-Chapter 568
5-(House Bill 1150)
62
7-AN ACT concerning
3+EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
4+ [Brackets] indicate matter deleted from existing law.
5+ Underlining indicates amendments to bill.
6+ Strike out indicates matter stricken from the bill by amendment or deleted from the law by
7+amendment.
8+ *hb1150*
89
9-Commercial Law and Financial Institutions – Credit Regulation – Shared
10-Appreciation Agreements
10+HOUSE BILL 1150
11+I2, I1 3lr1371
1112
12-FOR the purpose of making certain shared appreciation agreements subject to the
13-Maryland Mortgage Lender Law and other provisions of law that regulate certain
14-loans of single extensions of closed end credit and revolving credit plans; authorizing
15-the Commissioner of Financial Regulation to adopt certain regulations regarding the
16-enforcement of and compliance with provisions of law that regulate shared
17-appreciation agreements; and generally relating to credit regulation and shared
18-appreciation agreements.
13+By: Delegate Queen
14+Introduced and read first time: February 10, 2023
15+Assigned to: Economic Matters
16+Committee Report: Favorable
17+House action: Adopted
18+Read second time: March 10, 2023
1919
20-BY repealing and reenacting, without amendments,
21- Article – Commercial Law
22-Section 12–901(a) and 12–1001(a)
23- Annotated Code of Maryland
24- (2013 Replacement Volume and 2022 Supplement)
20+CHAPTER ______
2521
26-BY repealing and reenacting, with amendments,
27- Article – Commercial Law
28-Section 12–901(g) and (g–1) through (l), 12–913.1, 12–922, 12–1001(j) and (k–1)
29-through (m), and 12–1013
30- Annotated Code of Maryland
31- (2013 Replacement Volume and 2022 Supplement)
22+AN ACT concerning 1
3223
33-BY adding to
34- Article – Commercial Law
35- Section 12–901(n), 12–926, 12–1001(o), and 12–1030
36- Annotated Code of Maryland
37- (2013 Replacement Volume and 2022 Supplement)
24+Commercial Law and Financial Institutions – Credit Regulation – Shared 2
25+Appreciation Agreements 3
3826
39-BY repealing and reenacting, without amendments,
40- Article – Financial Institutions
41-Section 11–501(a)
42- Annotated Code of Maryland
43- (2020 Replacement Volume and 2022 Supplement)
27+FOR the purpose of making certain shared appreciation agreements subject to the 4
28+Maryland Mortgage Lender Law and other provisions of law that regulate certain 5
29+loans of single extensions of closed end credit and revolving credit plans; authorizing 6
30+the Commissioner of Financial Regulation to adopt certain regulations regarding the 7
31+enforcement of and compliance with provisions of law that regulate shared 8
32+appreciation agreements; and generally relating to credit regulation and shared 9
33+appreciation agreements. 10
4434
45-BY repealing and reenacting, with amendments,
46- Article – Financial Institutions
47-Section 11–501(h–1) through (q)
48- Annotated Code of Maryland
49- (2020 Replacement Volume and 2022 Supplement) Ch. 568 2023 LAWS OF MARYLAND
35+BY repealing and reenacting, without amendments, 11
36+ Article – Commercial Law 12
37+Section 12–901(a) and 12–1001(a) 13
38+ Annotated Code of Maryland 14
39+ (2013 Replacement Volume and 2022 Supplement) 15
5040
51-– 2 –
41+BY repealing and reenacting, with amendments, 16
42+ Article – Commercial Law 17
43+Section 12–901(g) and (g–1) through (l), 12–913.1, 12–922, 12–1001(j) and (k–1) 18
44+through (m), and 12–1013 19
45+ Annotated Code of Maryland 20
46+ (2013 Replacement Volume and 2022 Supplement) 21
5247
53-BY adding to
54- Article – Financial Institutions
55- Section 11–501(r)
56- Annotated Code of Maryland
57- (2020 Replacement Volume and 2022 Supplement)
48+BY adding to 22 2 HOUSE BILL 1150
5849
59- SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND,
60-That the Laws of Maryland read as follows:
6150
62-Article – Commercial Law
51+ Article – Commercial Law 1
52+ Section 12–901(n), 12–926, 12–1001(o), and 12–1030 2
53+ Annotated Code of Maryland 3
54+ (2013 Replacement Volume and 2022 Supplement) 4
6355
64-12–901.
56+BY repealing and reenacting, without amendments, 5
57+ Article – Financial Institutions 6
58+Section 11–501(a) 7
59+ Annotated Code of Maryland 8
60+ (2020 Replacement Volume and 2022 Supplement) 9
6561
66- (a) In this subtitle the following words have the meanings indicated.
62+BY repealing and reenacting, with amendments, 10
63+ Article – Financial Institutions 11
64+Section 11–501(h–1) through (q) 12
65+ Annotated Code of Maryland 13
66+ (2020 Replacement Volume and 2022 Supplement) 14
6767
68- (g) (1) “Loan” means a cash advance to be paid to or for the account of the
69-borrower.
68+BY adding to 15
69+ Article – Financial Institutions 16
70+ Section 11–501(r) 17
71+ Annotated Code of Maryland 18
72+ (2020 Replacement Volume and 2022 Supplement) 19
7073
71- (2) “LOAN” INCLUDES AN ADVANCE MADE IN ACCORDANCE W ITH THE
72-TERMS OF A SHARED AP PRECIATION AGREEMENT .
74+ SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 20
75+That the Laws of Maryland read as follows: 21
7376
74- [(g–1)] (H) “Mobile home” has the meaning stated in § 11–501 of the Financial
75-Institutions Article.
77+Article – Commercial Law 22
7678
77- [(h)] (I) “Nonconsumer borrower” means any borrower other than a consumer
78-borrower.
79+12–901. 23
7980
80- [(i)] (J) (1) “Outstanding unpaid indebtedness” means on any day the total
81-amount of purchases and loans charged to the borrower’s account under the plan which is
82-outstanding and unpaid at the end of the day, after adding the aggregate amount of any
83-new purchases and loans charged to the account that day and deducting the aggregate
84-amount of any payments and credits applied to the account that day.
81+ (a) In this subtitle the following words have the meanings indicated. 24
8582
86- (2) If the agreement governing the plan permits, “outstanding unpaid
87-indebtedness” may include the amount of any interest, finance charges, and additional
88-charges, including late or delinquency charges, that have accrued in the account and are
89-unpaid at the end of the day.
83+ (g) (1) “Loan” means a cash advance to be paid to or for the account of the 25
84+borrower. 26
9085
91- [(j)] (K) “Purchase” means an extension of credit for a purchase of real or
92-personal, tangible or intangible property, or an extension of credit for services, licenses,
93-taxes, official fees, fines, private or governmental obligations, or any other thing of value,
94-including a charitable contribution.
95- WES MOORE, Governor Ch. 568
86+ (2) “LOAN” INCLUDES AN ADVANCE MADE IN ACCORDANCE W ITH THE 27
87+TERMS OF A SHARED AP PRECIATION AGREEMENT . 28
9688
97-– 3 –
98- [(k)] (L) “Residential real property” means owner–occupied real property having
99-a dwelling on it designated principally as a residence with accommodations for not more
100-than four families.
89+ [(g–1)] (H) “Mobile home” has the meaning stated in § 11–501 of the Financial 29
90+Institutions Article. 30
10191
102- [(l)] (M) “Revolving credit plan” or “plan” means a plan that contemplates the
103-extension of credit under an account governed by an agreement between a credit grantor
104-and a borrower under which:
92+ [(h)] (I) “Nonconsumer borrower” means any borrower other than a consumer 31
93+borrower. 32
10594
106- (1) The credit grantor permits the borrower and, if the agreement
107-governing the plan permits, persons acting on behalf of or with authorization from the
108-borrower to make purchases or obtain loans from time to time;
95+ [(i)] (J) (1) “Outstanding unpaid indebtedness” means on any day the total 33
96+amount of purchases and loans charged to the borrower’s account under the plan which is 34 HOUSE BILL 1150 3
10997
110- (2) The amounts of purchases and loans are charged to the borrower’s
111-account;
11298
113- (3) The borrower is required to pay the credit grantor the amounts of all
114-purchases and loans charged to the borrower’s account under the plan but has the privilege
115-of paying amounts due from time to time as agreed; and
99+outstanding and unpaid at the end of the day, after adding the aggregate amount of any 1
100+new purchases and loans charged to the account that day and deducting the aggregate 2
101+amount of any payments and credits applied to the account that day. 3
116102
117- (4) Interest or finance charges may be charged and collected by the credit
118-grantor from time to time on the amounts due under the plan.
103+ (2) If the agreement governing the plan permits, “outstanding unpaid 4
104+indebtedness” may include the amount of any interest, finance charges, and additional 5
105+charges, including late or delinquency charges, that have accrued in the account and are 6
106+unpaid at the end of the day. 7
119107
120- (N) “SHARED APPRECIATION A GREEMENT” HAS THE MEANING STAT ED IN §
121-11–501 OF THE FINANCIAL INSTITUTIONS ARTICLE.
108+ [(j)] (K) “Purchase” means an extension of credit for a purchase of real or 8
109+personal, tangible or intangible property, or an extension of credit for services, licenses, 9
110+taxes, official fees, fines, private or governmental obligations, or any other thing of value, 10
111+including a charitable contribution. 11
122112
123-12–913.1.
113+ [(k)] (L) “Residential real property” means owner–occupied real property having 12
114+a dwelling on it designated principally as a residence with accommodations for not more 13
115+than four families. 14
124116
125- (a) (1) On or after October 1, 1993, a credit grantor may at its option elect to
126-offer a plan to any borrower either pursuant to this subtitle or as otherwise permitted by
127-applicable law.
117+ [(l)] (M) “Revolving credit plan” or “plan” means a plan that contemplates the 15
118+extension of credit under an account governed by an agreement between a credit grantor 16
119+and a borrower under which: 17
128120
129- (2) In order for a plan to be established under and governed by this subtitle,
130-a credit grantor shall make a written election to that effect in the agreement governing the
131-plan.
121+ (1) The credit grantor permits the borrower and, if the agreement 18
122+governing the plan permits, persons acting on behalf of or with authorization from the 19
123+borrower to make purchases or obtain loans from time to time; 20
132124
133- (b) (1) If a credit grantor elects in accordance with this section to establish a
134-plan under this subtitle, the provisions of Subtitle 1, 3, 4, 5, 6, or 10 of this title do not apply
135-to the plan.
125+ (2) The amounts of purchases and loans are charged to the borrower’s 21
126+account; 22
136127
137- (2) If a person fails to elect in accordance with this section to establish a
138-plan under this subtitle, the provisions of this subtitle do not apply.
128+ (3) The borrower is required to pay the credit grantor the amounts of all 23
129+purchases and loans charged to the borrower’s account under the plan but has the privilege 24
130+of paying amounts due from time to time as agreed; and 25
139131
140- (C) NOTWITHSTANDING ANY O THER PROVISION OF TH IS TITLE, A LOAN
141-SHALL BE SUBJECT TO THE PROVISIONS OF TH IS SUBTITLE, WHETHER OR NOT
142-ELECTED, IF THE LOAN:
143- Ch. 568 2023 LAWS OF MARYLAND
132+ (4) Interest or finance charges may be charged and collected by the credit 26
133+grantor from time to time on the amounts due under the plan. 27
144134
145-– 4 –
146- (1) IS A SHARED APPRECIATIO N AGREEMENT ; AND
135+ (N) “SHARED APPRECIATION A GREEMENT” HAS THE MEANING STAT ED IN § 28
136+11–501 OF THE FINANCIAL INSTITUTIONS ARTICLE. 29
147137
148- (2) ALLOWS THE BORROWER T O REPAY ADVANCES AND HAVE ANY
149-REPAID AMOUNTS SUBSE QUENTLY RE ADVANCED TO THE BORR OWER.
138+12–913.1. 30
150139
151-12–922.
140+ (a) (1) On or after October 1, 1993, a credit grantor may at its option elect to 31
141+offer a plan to any borrower either pursuant to this subtitle or as otherwise permitted by 32
142+applicable law. 33
143+ 4 HOUSE BILL 1150
152144
153- (a) (1) In this section the following words have the meanings indicated.
154145
155- (2) “Borrower” means a consumer borrower who makes an application for
156-a loan secured by a first mortgage or first deed of trust on residential real property to be
157-occupied by the borrower as the borrower’s primary residence.
146+ (2) In order for a plan to be established under and governed by this subtitle, 1
147+a credit grantor shall make a written election to that effect in the agreement governing the 2
148+plan. 3
158149
159- (3) “Commitment” means a written, specific, binding agreement between a
160-borrower and a lender which sets forth the terms of a loan being extended to the borrower.
150+ (b) (1) If a credit grantor elects in accordance with this section to establish a 4
151+plan under this subtitle, the provisions of Subtitle 1, 3, 4, 5, 6, or 10 of this title do not apply 5
152+to the plan. 6
161153
162- (4) “Financing agreement” means a written agreement between a borrower
163-and a lender [which sets] THAT:
154+ (2) If a person fails to elect in accordance with this section to establish a 7
155+plan under this subtitle, the provisions of this subtitle do not apply. 8
164156
165- (I) SETS forth the terms of a purchase money loan or a refinancing
166-of an existing loan that:
157+ (C) NOTWITHSTANDING ANY O THER PROVISION OF THIS TIT LE, A LOAN 9
158+SHALL BE SUBJECT TO THE PROVISIONS OF TH IS SUBTITLE, WHETHER OR NOT 10
159+ELECTED, IF THE LOAN: 11
167160
168- [(i)] 1. Results in or is secured by a first mortgage or a first deed
169-of trust on residential real property to be occupied by the borrower; and
161+ (1) IS A SHARED APPRECIATIO N AGREEMENT ; AND 12
170162
171- [(ii)] 2. Is offered or extended to the borrower; OR
163+ (2) ALLOWS THE BORROWER T O REPAY ADVANCES AND HAVE ANY 13
164+REPAID AMOUNTS SUBSE QUENTLY RE ADVANCED TO THE BORR OWER. 14
172165
173- (II) IS A SHARED APPRECIAT ION AGREEMENT .
166+12–922. 15
174167
175- (5) (i) “Lender” means a credit grantor subject to the licensing
176-requirements of Title 11, Subtitle 5 of the Financial Institutions Article.
168+ (a) (1) In this section the following words have the meanings indicated. 16
177169
178- (ii) “Lender” does not include a credit grantor exempt from licensing
179-under § 11–502 of the Financial Institutions Article.
170+ (2) “Borrower” means a consumer borrower who makes an application for 17
171+a loan secured by a first mortgage or first deed of trust on residential real property to be 18
172+occupied by the borrower as the borrower’s primary residence. 19
180173
181- (6) (i) “Loan application” means any oral or written request for an
182-extension of credit that is made in accordance with procedures established by a lender for
183-the purpose of inducing the lender to seek to procure or make a mortgage loan.
174+ (3) “Commitment” means a written, specific, binding agreement between a 20
175+borrower and a lender which sets forth the terms of a loan being extended to the borrower. 21
184176
185- (ii) “Loan application” does not include the use of an account or line
186-of credit to obtain a loan within a previously established credit limit.
177+ (4) “Financing agreement” means a written agreement between a borrower 22
178+and a lender [which sets] THAT: 23
187179
188- (b) (1) A lender who offers to make or procure a loan secured by a first
189-mortgage or first deed of trust on residential real property to be occupied by the borrower WES MOORE, Governor Ch. 568
180+ (I) SETS forth the terms of a purchase money loan or a refinancing 24
181+of an existing loan that: 25
190182
191-– 5 –
192-shall provide the borrower with a financing agreement executed by the lender within 10
193-business days after the date the loan application is completed.
183+ [(i)] 1. Results in or is secured by a first mortgage or a first deed 26
184+of trust on residential real property to be occupied by the borrower; and 27
194185
195- (2) The financing agreement shall provide:
186+ [(ii)] 2. Is offered or extended to the borrower; OR 28
196187
197- (i) The term and principal amount of the loan;
188+ (II) IS A SHARED APPRECIAT ION AGREEMENT . 29
198189
199- (ii) An explanation of the type of mortgage loan being offered;
190+ (5) (i) “Lender” means a credit grantor subject to the licensing 30
191+requirements of Title 11, Subtitle 5 of the Financial Institutions Article. 31 HOUSE BILL 1150 5
200192
201- (iii) The rate of interest that will apply to the loan and, if the rate is
202-subject to change or is a variable rate or is subject to final determination at a future date
203-based on some objective standard, a specific statement of those facts;
204193
205- (iv) The points, if any, to be paid by the borrower or the seller, or
206-both; and
207194
208- (v) The term during which the financing agreement remains in
209-effect.
195+ (ii) “Lender” does not include a credit grantor exempt from licensing 1
196+under § 11–502 of the Financial Institutions Article. 2
210197
211- (3) If all the provisions of the financing agreement are not subject to future
212-determination, change, or alteration during its term, the financing agreement shall
213-constitute the final binding agreement between the parties as to the items covered by the
214-financing agreement.
198+ (6) (i) “Loan application” means any oral or written request for an 3
199+extension of credit that is made in accordance with procedures established by a lender for 4
200+the purpose of inducing the lender to seek to procure or make a mortgage loan. 5
215201
216- (c) (1) If any of the provisions of the financing agreement are subject to change
217-or determination after its execution, the lender shall provide the borrower with a
218-commitment, executed by the lender, at least 72 hours before the time of settlement agreed
219-to by the parties, providing:
202+ (ii) “Loan application” does not include the use of an account or line 6
203+of credit to obtain a loan within a previously established credit limit. 7
220204
221- (i) The effective fixed interest rate or initial interest rate that will
222-be applied to the loan; and
205+ (b) (1) A lender who offers to make or procure a loan secured by a first 8
206+mortgage or first deed of trust on residential real property to be occupied by the borrower 9
207+shall provide the borrower with a financing agreement executed by the lender within 10 10
208+business days after the date the loan application is completed. 11
223209
224- (ii) A restatement of all the remaining unchanged provisions of the
225-financing agreement.
210+ (2) The financing agreement shall provide: 12
226211
227- (2) Subsequent to execution of the financing agreement, the borrower may
228-waive in writing the 72–hour advance presentation requirement and accept the
229-commitment at settlement only if compliance with the 72–hour requirement is shown by
230-the lender to be infeasible.
212+ (i) The term and principal amount of the loan; 13
231213
232- (d) (1) A borrower aggrieved by any violation of this section shall be entitled
233-to bring a civil suit for damages, including reasonable attorney’s fees, against the lender.
214+ (ii) An explanation of the type of mortgage loan being offered; 14
234215
235- (2) The penalties set out under § 12–918 of this subtitle do not apply to any
236-violation of this section.
237- Ch. 568 2023 LAWS OF MARYLAND
216+ (iii) The rate of interest that will apply to the loan and, if the rate is 15
217+subject to change or is a variable rate or is subject to final determination at a future date 16
218+based on some objective standard, a specific statement of those facts; 17
238219
239-– 6 –
240-12–926.
220+ (iv) The points, if any, to be paid by the borrower or the seller, or 18
221+both; and 19
241222
242- THE COMMISSIONER OF FINANCIAL REGULATION MAY ADOPT REGULATIONS
243-REGARDING THE ENFORC EMENT OF AND COMPLIANCE WITH THIS SUBTITLE AS TO
244-CREDIT GRANTORS WHO OFFER OR MAKE SHARED APPRECIATION AGREEME NTS
245-UNDER THIS SUBTITLE .
223+ (v) The term during which the financing agreement remains in 20
224+effect. 21
246225
247-12–1001.
226+ (3) If all the provisions of the financing agreement are not subject to future 22
227+determination, change, or alteration during its term, the financing agreement shall 23
228+constitute the final binding agreement between the parties as to the items covered by the 24
229+financing agreement. 25
248230
249- (a) In this subtitle the following words have the meanings indicated.
231+ (c) (1) If any of the provisions of the financing agreement are subject to change 26
232+or determination after its execution, the lender shall provide the borrower with a 27
233+commitment, executed by the lender, at least 72 hours before the time of settlement agreed 28
234+to by the parties, providing: 29
250235
251- (j) (1) “Loan” means any single extension of closed end credit, whether
252-repayable in installments, on demand, or otherwise and whether extended in one or more
253-advances.
236+ (i) The effective fixed interest rate or initial interest rate that will 30
237+be applied to the loan; and 31
254238
255- (2) “LOAN” INCLUDES AN ADVANCE MADE IN ACCORDANCE W ITH THE
256-TERMS OF A SHARED AP PRECIATION AGREEMENT .
239+ (ii) A restatement of all the remaining unchanged provisions of the 32
240+financing agreement. 33 6 HOUSE BILL 1150
257241
258- [(k–1)] (L) “Mobile home” has the meaning stated in § 11–501 of the Financial
259-Institutions Article.
260242
261- [(l)] (M) “Remaining loan balance”, when used in reference to a debt cancellation
262-agreement, does not include:
263243
264- (1) Any delinquent or deferred payments;
244+ (2) Subsequent to execution of the financing agreement, the borrower may 1
245+waive in writing the 72–hour advance presentation requirement and accept the 2
246+commitment at settlement only if compliance with the 72–hour requirement is shown by 3
247+the lender to be infeasible. 4
265248
266- (2) Past due charges;
249+ (d) (1) A borrower aggrieved by any violation of this section shall be entitled 5
250+to bring a civil suit for damages, including reasonable attorney’s fees, against the lender. 6
267251
268- (3) Late payment charges;
252+ (2) The penalties set out under § 12–918 of this subtitle do not apply to any 7
253+violation of this section. 8
269254
270- (4) Unearned interest;
255+12–926. 9
271256
272- (5) Unearned rental payments;
257+ THE COMMISSIONER OF FINANCIAL REGULATION MAY ADOPT REGULATIONS 10
258+REGARDING THE ENFORC EMENT OF AND COMPLIANCE WITH THIS SUBTITLE AS TO 11
259+CREDIT GRANTORS WHO OFFER OR MAKE SHARED APPRECIATION AGREEME NTS 12
260+UNDER THIS SUBTITLE . 13
273261
274- (6) The portion of any financed taxes or charges, including charges for
275-credit life insurance, credit health insurance, credit involuntary unemployment benefit
276-insurance, and mechanical repair contracts, actually refunded to the borrower or credited
277-as a reduction to the loan balance; or
262+12–1001. 14
278263
279- (7) By agreement of the parties, the amount of any primary insurance
280-deductible.
264+ (a) In this subtitle the following words have the meanings indicated. 15
281265
282- [(m)] (N) “Residential real property” means owner–occupied real property having
283-a dwelling on it designated principally as a residence with accommodations for not more
284-than four families. WES MOORE, Governor Ch. 568
266+ (j) (1) “Loan” means any single extension of closed end credit, whether 16
267+repayable in installments, on demand, or otherwise and whether extended in one or more 17
268+advances. 18
285269
286-– 7 –
270+ (2) “LOAN” INCLUDES AN ADVANCE MADE IN ACCORDANCE WITH TH E 19
271+TERMS OF A SHARED AP PRECIATION AGREEMENT . 20
287272
288- (O) “SHARED APPRECIATION A GREEMENT” HAS THE MEANING STAT ED IN §
289-11–501 OF THE FINANCIAL INSTITUTIONS ARTICLE.
273+ [(k–1)] (L) “Mobile home” has the meaning stated in § 11–501 of the Financial 21
274+Institutions Article. 22
290275
291-12–1013.
276+ [(l)] (M) “Remaining loan balance”, when used in reference to a debt cancellation 23
277+agreement, does not include: 24
292278
293- (a) Unless otherwise provided under the express terms of the agreement, note, or
294-other evidence of the extension of closed end credit, the provisions of Subtitle 1, 3, 4, 5, 6,
295-or 9 of this title do not apply to an extension of closed end credit if:
279+ (1) Any delinquent or deferred payments; 25
296280
297- (1) The agreement, note, or other evidence of the extension of credit is made
298-before October 1, 1993; and
281+ (2) Past due charges; 26
299282
300- (2) The extension of credit is made under this subtitle before October 1,
301-1993.
283+ (3) Late payment charges; 27
302284
303- (b) For the purposes of subsection (a) of this section, an extension of credit is made
304-under this subtitle if:
285+ (4) Unearned interest; 28
305286
306- (1) The credit grantor has made a written election to do so in the
307-agreement, note, or other evidence of the extension of credit; or
287+ (5) Unearned rental payments; 29
288+ HOUSE BILL 1150 7
308289
309- (2) The agreement, note, or other evidence of the extension of credit is made
310-pursuant to the provisions of this subtitle.
311290
312- (c) For the purposes of subsection (a) of this section, if there is no written election
313-to extend credit under this subtitle, the burden of proof is on the credit grantor to show the
314-agreement, note, or other evidence of the extension of credit was made pursuant to this
315-subtitle.
291+ (6) The portion of any financed taxes or charges, including charges for 1
292+credit life insurance, credit health insurance, credit involuntary unemployment benefit 2
293+insurance, and mechanical repair contracts, actually refunded to the borrower or credited 3
294+as a reduction to the loan balance; or 4
316295
317- (d) Any agreement, note, or other evidence of an extension of credit made before
318-October 1, 1993 is not subject to § 12–1013.2 of this subtitle.
296+ (7) By agreement of the parties, the amount of any primary insurance 5
297+deductible. 6
319298
320- (E) NOTWITHSTANDING ANY O THER PROVISION OF TH IS TITLE, A LOAN
321-SHALL BE SUBJECT TO THE PROVISIONS OF TH IS SUBTITLE, WHETHER OR NOT
322-ELECTED, IF THE LOAN:
299+ [(m)] (N) “Residential real property” means owner–occupied real property having 7
300+a dwelling on it designated principally as a residence with accommodations for not more 8
301+than four families. 9
323302
324- (1) IS A SHARED APPRECIAT ION AGREEMENT ; AND
303+ (O) “SHARED APPRECIATION AGREEME NT” HAS THE MEANING STAT ED IN § 10
304+11–501 OF THE FINANCIAL INSTITUTIONS ARTICLE. 11
325305
326- (2) DOES NOT ALLOW THE BO RROWER TO REPAY ADVA NCES AND
327-HAVE ANY REPAID AMOU NTS SUBSEQUENTLY REA DVANCED TO THE BORRO WER.
306+12–1013. 12
328307
329-12–1030.
330- Ch. 568 2023 LAWS OF MARYLAND
308+ (a) Unless otherwise provided under the express terms of the agreement, note, or 13
309+other evidence of the extension of closed end credit, the provisions of Subtitle 1, 3, 4, 5, 6, 14
310+or 9 of this title do not apply to an extension of closed end credit if: 15
331311
332-– 8 –
333- THE COMMISSIONER OF FINANCIAL REGULATION MAY ADOPT REGULATIONS
334-REGARDING THE ENFORCEMENT OF AND COMPLIANCE WITH THIS SUBTITLE AS TO
335-CREDIT GRANTORS WHO OFFER OR MAKE SHARED APPRECIATION AGREEME NTS
336-UNDER THIS SUBTITLE .
312+ (1) The agreement, note, or other evidence of the extension of credit is made 16
313+before October 1, 1993; and 17
337314
338-Article – Financial Institutions
315+ (2) The extension of credit is made under this subtitle before October 1, 18
316+1993. 19
339317
340-11–501.
318+ (b) For the purposes of subsection (a) of this section, an extension of credit is made 20
319+under this subtitle if: 21
341320
342- (a) In this subtitle the following words have the meanings indicated.
321+ (1) The credit grantor has made a written election to do so in the 22
322+agreement, note, or other evidence of the extension of credit; or 23
343323
344- [(h–1)] (I) “Mobile home” means a structure, including the plumbing, heating, air
345-conditioning, and electrical systems contained in the structure, that is:
324+ (2) The agreement, note, or other evidence of the extension of credit is made 24
325+pursuant to the provisions of this subtitle. 25
346326
347- (1) Transportable in one or more sections;
327+ (c) For the purposes of subsection (a) of this section, if there is no written election 26
328+to extend credit under this subtitle, the burden of proof is on the credit grantor to show the 27
329+agreement, note, or other evidence of the extension of credit was made pursuant to this 28
330+subtitle. 29
348331
349- (2) Eight or more body feet in width and 30 or more body feet in length;
332+ (d) Any agreement, note, or other evidence of an extension of credit made before 30
333+October 1, 1993 is not subject to § 12–1013.2 of this subtitle. 31
334+ 8 HOUSE BILL 1150
350335
351- (3) Built on a permanent chassis; and
352336
353- (4) Permanently attached to land or connected to utility, water, or sewage
354-facilities.
337+ (E) NOTWITHSTANDING ANY O THER PROVISION OF TH IS TITLE, A LOAN 1
338+SHALL BE SUBJECT TO THE PROVISIONS OF TH IS SUBTITLE, WHETHER OR NOT 2
339+ELECTED, IF THE LOAN: 3
355340
356- [(i)] (J) “Mortgage broker” means a person who:
341+ (1) IS A SHARED APPREC IATION AGREEMENT ; AND 4
357342
358- (1) For a fee or other valuable consideration, whether received directly or
359-indirectly, aids or assists a borrower in obtaining a mortgage loan; and
343+ (2) DOES NOT ALLOW THE BO RROWER TO REPAY ADVA NCES AND 5
344+HAVE ANY REPAID AMOU NTS SUBSEQUENTLY REA DVANCED TO THE BORRO WER. 6
360345
361- (2) Is not named as a lender in the agreement, note, deed of trust, or other
362-evidence of the indebtedness.
346+12–1030. 7
363347
364- [(j)] (K) (1) “Mortgage lender” means any person who:
348+ THE COMMISSIONER OF FINANCIAL REGULATION MAY ADOPT REGULATIONS 8
349+REGARDING THE ENFORC EMENT OF AND COMPLIANCE WITH THIS SUBTITLE AS TO 9
350+CREDIT GRANTORS WHO OFFER OR MAKE SHARED APPRECIATION AGREEME NTS 10
351+UNDER THIS SUBTITLE . 11
365352
366- (i) Is a mortgage broker;
353+Article – Financial Institutions 12
367354
368- (ii) Makes a mortgage loan to any person; or
355+11–501. 13
369356
370- (iii) Is a mortgage servicer.
357+ (a) In this subtitle the following words have the meanings indicated. 14
371358
372- (2) “Mortgage lender” does not include:
359+ [(h–1)] (I) “Mobile home” means a structure, including the plumbing, heating, air 15
360+conditioning, and electrical systems contained in the structure, that is: 16
373361
374- (i) A financial institution that accepts deposits and is regulated
375-under Title 3, Title 4, Title 5, or Title 6 of this article;
362+ (1) Transportable in one or more sections; 17
376363
377- (ii) The Federal Home Loan Mortgage Corporation; WES MOORE, Governor Ch. 568
364+ (2) Eight or more body feet in width and 30 or more body feet in length; 18
378365
379-– 9 –
366+ (3) Built on a permanent chassis; and 19
380367
381- (iii) The Federal National Mortgage Association;
368+ (4) Permanently attached to land or connected to utility, water, or sewage 20
369+facilities. 21
382370
383- (iv) The Government National Mortgage Association;
371+ [(i)] (J) “Mortgage broker” means a person who: 22
384372
385- (v) Any person engaged exclusively in the acquisition of all or any
386-portion of a mortgage loan under any federal, State, or local governmental program of
387-mortgage loan purchases; or
373+ (1) For a fee or other valuable consideration, whether received directly or 23
374+indirectly, aids or assists a borrower in obtaining a mortgage loan; and 24
388375
389- (vi) An affiliated insurance producer–mortgage loan originator
390-licensed under § 11–603.1 of this title.
376+ (2) Is not named as a lender in the agreement, note, deed of trust, or other 25
377+evidence of the indebtedness. 26
391378
392- [(k)] (L) (1) “Mortgage lending business” means the activities set forth in the
393-definition of “mortgage lender” in subsection [(j)] (K) of this section which require that
394-person to be licensed under this subtitle.
379+ [(j)] (K) (1) “Mortgage lender” means any person who: 27
395380
396- (2) “Mortgage lending business” includes the making or procuring of
397-mortgage loans secured by a dwelling or residential real estate located outside Maryland.
381+ (i) Is a mortgage broker; 28 HOUSE BILL 1150 9
398382
399- [(l)] (M) (1) “Mortgage loan” means any loan primarily for personal, family,
400-or household use that is secured by a mortgage, deed of trust, or other equivalent
401-consensual security interest on a dwelling or residential real estate on which a dwelling is
402-constructed or intended to be constructed.
403383
404- (2) “MORTGAGE LOAN ” INCLUDES A LOAN IN WHICH FUNDS ARE
405-ADVANCED THROUGH A S HARED APPRECIATION A GREEMENT.
406384
407- [(m)] (N) “Mortgage loan originator” has the meaning stated in § 11–601 of this
408-title.
385+ (ii) Makes a mortgage loan to any person; or 1
409386
410- [(n)] (O) “Mortgage servicer” means a person who:
387+ (iii) Is a mortgage servicer. 2
411388
412- (1) Engages in whole or in part in the business of servicing mortgage loans
413-for others; or
389+ (2) “Mortgage lender” does not include: 3
414390
415- (2) Collects or otherwise receives payments on mortgage loans directly
416-from borrowers for distribution to any other person.
391+ (i) A financial institution that accepts deposits and is regulated 4
392+under Title 3, Title 4, Title 5, or Title 6 of this article; 5
417393
418- [(o)] (P) “Person” means a natural person, corporation, limited liability
419-company, partnership, business trust, statutory trust, or association.
394+ (ii) The Federal Home Loan Mortgage Corporation; 6
420395
421- [(p)] (Q) “Residential real estate” means any owner–occupied real property
422-located in Maryland on which a dwelling is constructed or intended to be constructed.
396+ (iii) The Federal National Mortgage Association; 7
423397
424- (R) “SHARED APPRECIATION A GREEMENT” MEANS A WRITING EVID ENCING
425-A TRANSACTION OR ANY OPTION, FUTURE, OR ANY OTHER DERIVAT IVE BETWEEN A Ch. 568 2023 LAWS OF MARYLAND
398+ (iv) The Government National Mortgage Association; 8
426399
427-– 10 –
428-PERSON AND A CONSUME R WHERE THE CONSUMER RECEIVES MONEY OR ANY OTHER
429-ITEM OF VALUE IN EXC HANGE FOR A N INTEREST OR FUTURE I NTEREST IN A
430-DWELLING OR RESIDENTIAL REAL EST ATE, OR A FUTURE OBLIGATI ON TO REPAY A
431-SUM ON THE OCCURRENC E OF AN EVENT SUCH AS:
400+ (v) Any person engaged exclusively in the acquisition of all or any 9
401+portion of a mortgage loan under any federal, State, or local governmental program of 10
402+mortgage loan purchases; or 11
432403
433- (1) THE TRANSFER OF OWNERSHI P;
404+ (vi) An affiliated insurance producer–mortgage loan originator 12
405+licensed under § 11–603.1 of this title. 13
434406
435- (2) A REPAYMENT MATURITY D ATE;
407+ [(k)] (L) (1) “Mortgage lending business” means the activities set forth in the 14
408+definition of “mortgage lender” in subsection [(j)] (K) of this section which require that 15
409+person to be licensed under this subtitle. 16
436410
437- (3) THE DEATH OF THE CONSUME R; OR
411+ (2) “Mortgage lending business” includes the making or procuring of 17
412+mortgage loans secured by a dwelling or residential real estate located outside Maryland. 18
438413
439- (4) ANY OTHER EVENT CONTEMPLATED BY THE WRITING.
414+ [(l)] (M) (1) “Mortgage loan” means any loan primarily for personal, family, 19
415+or household use that is secured by a mortgage, deed of trust, or other equivalent 20
416+consensual security interest on a dwelling or residential real estate on which a dwelling is 21
417+constructed or intended to be constructed. 22
440418
441- [(q)] (S) “State” means the State of Maryland.
419+ (2) “MORTGAGE LOAN ” INCLUDES A LOAN IN WHICH FUNDS ARE 23
420+ADVANCED THROUGH A S HARED APPRECIATION A GREEMENT. 24
442421
443- SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July
444-1, 2023.
422+ [(m)] (N) “Mortgage loan originator” has the meaning stated in § 11–601 of this 25
423+title. 26
445424
446-Approved by the Governor, May 8, 2023.
425+ [(n)] (O) “Mortgage servicer” means a person who: 27
426+
427+ (1) Engages in whole or in part in the business of servicing mortgage loans 28
428+for others; or 29
429+ 10 HOUSE BILL 1150
430+
431+
432+ (2) Collects or otherwise receives payments on mortgage loans directly 1
433+from borrowers for distribution to any other person. 2
434+
435+ [(o)] (P) “Person” means a natural person, corporation, limited liability 3
436+company, partnership, business trust, statutory trust, or association. 4
437+
438+ [(p)] (Q) “Residential real estate” means any owner–occupied real property 5
439+located in Maryland on which a dwelling is constructed or intended to be constructed. 6
440+
441+ (R) “SHARED APPRECIATION A GREEMENT” MEANS A WRITING EVID ENCING 7
442+A TRANSACTION OR ANY OPTION, FUTURE, OR ANY OTHER DERIVATIVE BETWEEN A 8
443+PERSON AND A CONSUME R WHERE THE CONSUMER RECEIVES MONEY OR ANY OTHER 9
444+ITEM OF VALUE IN EXC HANGE FOR A N INTEREST OR FUTURE I NTEREST IN A 10
445+DWELLING OR RESIDENTIAL REAL EST ATE, OR A FUTURE OBLIGATI ON TO REPAY A 11
446+SUM ON THE OCCURRENC E OF AN EVENT SUCH AS: 12
447+
448+ (1) THE TRANSFER OF OWNERSHI P; 13
449+
450+ (2) A REPAYMENT MATURITY D ATE; 14
451+
452+ (3) THE DEATH OF THE CONSUME R; OR 15
453+
454+ (4) ANY OTHER EVENT CONTEMPLATED BY THE WRITING. 16
455+
456+ [(q)] (S) “State” means the State of Maryland. 17
457+
458+ SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 18
459+1, 2023. 19
460+
461+
462+
463+Approved:
464+________________________________________________________________________________
465+ Governor.
466+________________________________________________________________________________
467+ Speaker of the House of Delegates.
468+________________________________________________________________________________
469+ President of the Senate.