H. B. 4007
(By Delegate Guthrie)
[Introduced January 9, 2008; referred to the
Committee on Banking and Insurance then the Judiciary.]
A BILL to amend the Code of West Virginia, 1931, as amended, by
adding thereto a new section, designated §46A-2-140, relating
to the prevention of predatory lending practices.
Be it enacted by the Legislature of West Virginia:
That the Code of West Virginia, 1931, as amended, be amended
by adding thereto a new section, designated §46A-2-140, to read as
follows:
ARTICLE 2. CONSUMER CREDIT PROTECTION.
§46A-2-140. Prohibited conduct; restrictions on interests in land
as security.
No interest in land shall be taken as security arising out of
credit sale or consumer loan:
(1) In which the loan or sale is not underwritten to determine
whether the borrower can afford to repay consistent with the terms of the loan or sale;
(2) Which does not include the obligation to engage in
comprehensive loss mitigation;
(3) In which the consumer refinances an existing home-secured
loan without achieving a net tangible benefit;
(4) In which income verification is not a part of the consumer
loan underwriting;
(5) Which, not withstanding section one hundred ten, article
three of this chapter, has a prepayment penalty in connection
therewith;
(6) In which a trust deed allows for the substitution of the
trustee without the consent of both parties, absent the death,
disability or other inability to serve of the original agreed upon
trustee; or
(7) In which the consumer is charged a rate of finance charge
higher than that for which the consumer qualifies.
As used in this section only, "consumer loan" does not include
a "consumer loan" made onsite by a depository institution.
NOTE: The purpose of this bill is to address the causes of the
current foreclosure crisis and generally protect consumers from
losing their homes as a result of the subprime and other lenders'
overreaching practices and contract provisions, the significance of
which consumers cannot be expected to understand.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
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