Utah § 7-17-4 - Options in lieu of reserve account -- Notice by lender -- Selection by borrower -- Noninterest-bearing reserve account -- Exemption.
Full text of Utah Utah Code § 7-17-4 — Options in lieu of reserve account -- Notice by lender -- Selection by borrower -- Noninterest-bearing reserve account -- Exemption., with citation guidance and answers to common questions.
§ 7-17-4. Options in lieu of reserve account -- Notice by lender -- Selection by borrower -- Noninterest-bearing reserve account -- Exemption.
7-17-4.
Options in lieu of reserve account -- Notice by lender -- Selection by borrower -- Noninterest-bearing reserve account -- Exemption.
(1)
A lender not requiring the establishment and maintenance of a reserve account shall offer the borrower the following options:
(a)
the borrower may elect to maintain a noninterest-bearing reserve account to be serviced by the lender at no charge to the borrower; or
(b)
the borrower may manage the payment of insurance premiums, taxes and other charges for the borrower's own account.
(2)
(a)
The lender shall give written notice of the options to the borrower:
(i)
with respect to real estate loans existing on July 1, 1979, by notice mailed not more than 30 days after July 1, 1979; or
(ii)
with respect to real estate loans made on or after July 1, 1979, by notice given at or prior to the closing of the loan.
the borrower is legally responsible for the payment of taxes, insurance premiums, and other charges; and
(C)
the notice is being given pursuant to this chapter.
(c)
For real estate loans in existence on July 1, 1979, the borrower shall select one of the options prior to 60 days after July 1, 1979.
(d)
If no option is selected prior to 60 days after July 1, 1979, the borrower will be considered to have selected the option described in Subsection (1)(a), provided, however, that the borrower at a later time may select the option described in Subsection (1)(b).
(e)
For loans made on or after July 1, 1979, the borrower shall select one of the options at the closing.
(f)
If the borrower selects the option described in Subsection (1)(a), the lender may not be required to account for earnings, if any, on the account.
(3)
(a)
Subject to Subsection (3)(b), if the borrower who selects the option described in Subsection (1)(b), or the borrower's successors or assigns, fails to pay the taxes, insurance premiums, or other charges pertaining to the property securing the loan prior to the delinquency date for such payments, the lender may require a reserve account without interest or other compensation for the use of the funds.
(b)
Notwithstanding Subsection (3)(a), the lender may not require a reserve account without interest or other compensation if:
(i)
the borrower pays any delinquency within 30 days; and
(ii)
the borrower has not previously been delinquent in payment of taxes, insurance premiums, or other charges.
(4)
This section does not apply to a loan made, renewed, or modified on or after May 6, 2002.
Section 7-17-4 ("Options in lieu of reserve account -- Notice by lender -- Selection by borrower -- Noninterest-bearing reserve account -- Exemption.") is part of the Utah Code, the codified statutory law of Utah. It sets out the legal rule or procedure described in the text above. Statutes are amended regularly, so always verify against the official source.
How do I cite Utah § 7-17-4?
A common citation format is "Utah Code § 7-17-4" (Utah). Legal writing may require the code abbreviation, section number, and year or edition. Match the style required by your court, professor, or publisher.
Is this the official text of Utah law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the Utah official source linked on this page or consult a licensed Utah attorney.
How does Utah § 7-17-4 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in Utah can advise on how this section applies to you. Contact your state or local bar association for a referral.
