New Jersey § 46:10b-26

§ 46:10b-26.

A high-cost home loan shall be subject to the following additional limitations and

prohibited practices: a. No high-cost home loan shall contain a scheduled payment that is more than twice

as large as the average of earlier scheduled payments. This provision shall not apply when the payment schedule is adjusted to the seasonal

or irregular income of the borrower. b. No high-cost home loan shall include payment terms under which the outstanding

principal balance will increase at any time over the course of the loan because the

regular periodic payments do not cover the full amount of interest due. c. No high-cost home loan shall contain a provision that increases the interest rate

after default. This provision shall not apply to interest rate changes in a variable rate loan

otherwise consistent with the provisions of the loan documents, provided the change

in the interest rate is not triggered by the event of default or the acceleration

of the indebtedness. d. No high-cost home loan shall include terms under which more than two periodic payments

required under the loan are consolidated and paid in advance from the loan proceeds

provided to the borrower. e. Without regard to whether a borrower is acting individually or on behalf of others

similarly situated, any provision of a high-cost home loan agreement that allows a

party to require a borrower to assert any claim or defense in a forum that is less

convenient, more costly, or more dilatory for the resolution of a dispute than a judicial

forum established in this State if the borrower may otherwise properly bring a claim

or defense or limits in any way any claim or defense the borrower may have is unconscionable

and void. f. A creditor shall not make a high-cost home loan unless the creditor has given the

following notice, or substantially similar notice, in writing, to the borrower, acknowledged

in writing and signed by the borrower not later than the time the notice is required

under the notice provision contained in 12 C.F.R. s.226.31(c) . NOTICE TO BORROWER YOU SHOULD BE AWARE THAT YOU MIGHT BE ABLE TO OBTAIN A LOAN AT A LOWER COST. YOU SHOULD SHOP AROUND AND COMPARE LOAN RATES AND FEES. MORTGAGE LOAN RATES AND CLOSING COSTS AND FEES VARY BASED ON MANY FACTORS, INCLUDING

YOUR PARTICULAR CREDIT AND FINANCIAL CIRCUMSTANCES, YOUR EMPLOYMENT HISTORY, THE LOAN-TO-VALUE

REQUESTED AND THE TYPE OF PROPERTY THAT WILL SECURE YOUR LOAN. THE LOAN RATE AND FEES COULD ALSO VARY BASED ON WHICH CREDITOR OR BROKER YOU SELECT. IF YOU ACCEPT THE TERMS OF THIS LOAN, THE CREDITOR WILL HAVE A MORTGAGE LIEN ON YOUR

HOME. YOU COULD LOSE YOUR HOME AND ANY MONEY YOU PUT INTO IT IF YOU DO NOT MEET YOUR PAYMENT

OBLIGATIONS UNDER THE LOAN. YOU SHOULD CONSULT AN ATTORNEY-AT-LAW AND A QUALIFIED INDEPENDENT CREDIT COUNSELOR

OR OTHER EXPERIENCED FINANCIAL ADVISOR REGARDING THE RATE, FEES AND PROVISIONS OF

THIS MORTGAGE LOAN BEFORE YOU PROCEED. A LIST OF QUALIFIED COUNSELORS IS AVAILABLE BY CONTACTING THE NEW JERSEY DEPARTMENT

OF BANKING AND INSURANCE. YOU ARE NOT REQUIRED TO COMPLETE THIS LOAN AGREEMENT MERELY BECAUSE YOU HAVE RECEIVED

THIS DISCLOSURE OR HAVE SIGNED A LOAN APPLICATION. REMEMBER, PROPERTY TAXES AND HOMEOWNER'S INSURANCE ARE YOUR RESPONSIBILITY. NOT ALL CREDITORS PROVIDE ESCROW SERVICES FOR THESE PAYMENTS. YOU SHOULD ASK YOUR CREDITOR ABOUT THESE SERVICES. ALSO, YOUR PAYMENTS ON EXISTING DEBTS CONTRIBUTE TO YOUR CREDIT RATINGS. YOU SHOULD NOT ACCEPT ANY ADVICE TO IGNORE YOUR REGULAR PAYMENTS TO YOUR EXISTING

CREDITORS. g. A creditor shall not make a high-cost home loan to a borrower who finances points

and fees in connection with a high-cost home loan without first receiving certification

from a third-party nonprofit credit counselor, approved by the United States Department

of Housing and Urban Development and the Department of Banking and Insurance, that

the borrower has received counseling on the advisability of the loan transaction or

completing another substantial requirement developed by the department. h. A creditor shall not pay a contractor under a home-improvement contract from the

proceeds of a high-cost home loan, unless the instrument is payable to the borrower

or jointly to the borrower and the contractor, or, at the election of the borrower,

through a third-party escrow agent in accordance with terms established in a written

agreement signed by the borrower, the creditor, and the contractor prior to the disbursement. i. A creditor shall not charge a borrower any fees or other charges to modify, renew,

extend, or amend a high-cost home loan or to defer any payment due under the terms

of a high-cost home loan. j. A creditor shall not charge a borrower points and fees in connection with a high-cost

home loan if the proceeds of the high-cost home loan are used to refinance an existing

high-cost home loan held by the same creditor as note holder. k. Notwithstanding any other law to the contrary, a creditor making a high-cost home

loan that has the legal right to foreclose shall use the judicial foreclosure procedures

of this State so long as the property securing the loan is located in this State. l . No creditor making a high-cost home loan shall directly or indirectly finance points

and fees in excess of 2% of the total loan amount.