SB 83 -- SALE OF DEFICIENCY WAIVER ADDENDUMS

This bill authorizes the sale of a deficiency waiver addendum, a
guaranteed asset protection, or a similar product as part of
certain consumer loans, second mortgage loans, or retail credit
sales if the product is purchased as part of a loan transaction
with collateral.  The borrower must consent to the purchase in
writing and acknowledge receipt of the required disclosures.  The
cost of the product must be reasonable and disclosed in the loan
contract.  Each deficiency waiver addendum, guaranteed asset
protection, or other similar product must provide that in the
event of the termination of the product prior to the scheduled
maturity date of the indebtedness, any refund must be paid or
credited promptly to the debtor, except that a refund of less
than $1 does not need to be made.  The pro rata method must be
used in computing the refund.

A debtor may cancel a product within 15 days of its purchase and
receive a complete refund or credit of the premium.  This
information must be specified in the loan contract or in a
separate written disclosure at the time the debt is incurred in
10-point type and in a manner reasonably calculated to inform the
debtor of this right.

Missouri House of Representatives
96th General Assembly, 1st Regular Session
Last Updated August 9, 2011 at 1:30 pm