Senate Bill No. 87
(By Senators Kessler, Edgell, Foster and Laird)
[Introduced January 13, 2010; referred to the Committee on
Banking and Insurance; and then to the Committee on the
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
ARTICLE 2. CONSUMER CREDIT PROTECTION.
§46A-2-140. Prohibited conduct; restrictions on interests in land
No interest in land shall be taken as security arising out of
credit sale, consumer loan or rent-to-own agreement:
(1) In which the loan, agreement 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
(5) Which, notwithstanding section one hundred ten, article
three of this chapter, has a prepayment penalty in connection
(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
(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.
"Rent-to-own agreement" is to be given the same definition as
the term is defined in subdivision (17), section five, article one,
chapter forty-six-b of this code.
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.
This section is new; therefore, strike-throughs and
underscoring have been omitted.