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Utah Administrative Code (Current through November 1, 2019) |
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R335. Financial Institutions, Consumer Credit |
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R335-1. Rule Prohibiting Negative Amortizing Wrap Loans |
| R335-1-1. Authority, Scope and Purpose |
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Latest version.
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(1) This amended rule is adopted pursuant to Section 70C-8-102(1)(e). (2) This rule shall apply to all extensions of credit subject to Title 70C, Utah Consumer Credit Code. (3) The purpose for this rule is to prohibit wrap loans that will not fully service all obligations wrapped by the loan. |
| R335-1-2. Definitions |
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"Wrap loan" means an extension of credit that includes an agreement by the lender to service all or part of the balance due on other debts owed by the borrower out of payments made on the wrap loan. |
| R335-1-3. Rule Prohibiting Negative Wrap Loans |
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Latest version.
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All wrap loans subject to Title 70C shall provide for a minimum monthly payment sufficient to pay at least the monthly interest on the wrap loan and the total monthly payment, including interest, principal, escrow or reserve payments, or both, on all obligations wrapped by the loan. |