Kentucky Revised Statute § 286.4-540(1) instructs that:
“Every licensee shall:
(1) Deliver to the borrower at the time of making a loan, or to one (1) of them if there are two (2) or more obligors on the loan, a statement showing in clear and distinct terms the amount and date of the loan and the date of its maturity, the nature of the security for the loan, the name and address of the borrower and of the licensee, the schedule of payments or a description thereof, and the agreed charges or rate of charge on such loan provided, that when charges are contracted for under KRS § 286.4-530(1), the statement shall show the cash advance and the amount of the note including charges, the additional charges contracted for in case of default or deferment and that a refund is required for prepayment in full;”
This disclosure is subject to narrow parameters and will rarely be applicable. Specifically, this disclosure is confined to loans that with loan amounts equal to or less than fifteen thousand dollars ($15,000), with an interest rate greater than the “legal rate of interest” (8%), per KRS § 360.010.
To satisfy this statute, Docutech has created a new Kentucky Consumer Loan Statement that should only be used in Closing packages for KY loans with loan amounts of $15,000 or less and an interest rate of 8% or more.
In addition to the above, KRS § 304.9-135(6) states that:
“A financial institution shall not include an expense of insurance premiums in a credit transaction when a consumer obtains insurance and credit, other than credit insurance, from a financial institution or any individual or business entity soliciting or selling insurance on the premises of a financial institution, without the written consent of the consumer.”
In order to comply with this requirement, Docutech has created a new document, Kentucky Consent to Insurance Premiums (Cx21262). This document is available for any loans that may be subject to the conditions of the above statute.
Both documents will be available “upon request” beginning on April 6, 2017. If you have any questions or concerns about these new documents, please contact Client Support at 1.800.497.3584.