R.I. HB 5510 and SB 1079 (2011), which were signed by Governor Lincoln D. Chaffee (I) on July 13, 2011, amend R.I. Gen. Law §34-23-6 (“Section”), which provides for the issuance of a disclosure specifying that certain loan fees are not refundable if the underlying loan contract is prepaid in full.
These bills change the Section as follows:
1. The Section previously provided for certain loan fees to be nonrefundable in the event of prepayment. Now the Section only allows for this if the disclosure concerning nonrefundable fees is provided to the loan applicant in writing;
2. The Section previously required issuance of both the federal Good Faith Estimate and the disclosure concerning nonrefundable fees. It now only requires the latter;
3. The specific language of the disclosure has been altered by eliminating the phrase “or other itemization” from the first clause; and
4. The applicant is not required to acknowledge receipt of the disclosure.
DocuTech’s version of the disclosure (Cx3575) has been submitted to be modified accordingly. Nevertheless, it will continue to contain its acknowledgment section for “good business practice” purposes.
July 21, 2011