There is a newer version of the Kentucky Revised Statutes
2009 Kentucky Revised Statutes
Subtitle 8. Mortgage Loan Companies and Brokers
286.8.120 Fees and charges in addition to interest -- Letters of commitment -- Failure to fulfill terms constitutes default.
Download pdfextending, readjusting, or renewing of loans. Without limiting the generality of the
foregoing, such expenses may include appraisal, attorneys' fees, abstract, recording
and registration fees, title examination, title insurance, mortgage insurance, credit
report, survey, drawing of papers, origination fees, loan closing costs, and taxes or
charges imposed upon or in connection with the making and reporting of any
mortgage. (2) Every mortgage loan company also may require the borrowers to pay the cost of all other necessary and incidental services rendered by the mortgage loan company or
by others in connection with loans in reasonable amounts. Without limiting the
generality of the foregoing, such costs may include the cost of services of
inspectors, engineers, and architects. (3) Such initial charges as described in subsections (1) and (2) of this section may be collected by the mortgage loan company from the borrower and paid to any person
rendering such services, or paid directly by the borrower. (4) In lieu of such initial charges to cover such expenses and costs as described in subsections (1) and (2) of this section, a mortgage loan company may make a
reasonable charge, part or all of which may be retained by the mortgage loan
company which renders such service, or part or all of which may be paid to others
who render such services. (5) The fees and charges authorized by this section shall be in addition to interest authorized by law, and shall not be deemed to be a part of the interest collected or
agreed to be paid on such loans within the meaning of any law of this
Commonwealth which limits the rate of interest which may be exacted in any
transaction. (6) No person shall receive any fee or other compensation of any kind in connection with procuring any loan, except for services actually rendered as above provided,
and in no event shall a mortgage loan company or mortgage loan broker require the
payment of a fee greater than one hundred dollars ($100) as a condition to
submitting a loan application unless the commissioner shall otherwise prescribe by
rule. (7) All "letters of commitment," or any other contracts or agreements between prospective borrowers and a mortgage loan company or a loan broker, where the
borrowers employ services, for a fee or commission, to obtain a loan commitment
or funding from a lending institution shall indicate the terms and conditions thereof,
including a full and detailed description of the services the broker or company
undertakes to perform, a specific statement of the circumstances in which the broker
or company will be entitled to obtain or retain consideration and the period that
such agreement shall remain in effect. (8) Failure on the part of any party, with the exception of the borrower, to fulfill the terms of any loan commitment, letter of commitment, agreement, or contract for the
loan of money within the time and on such terms specified therein, or the failure to
make a bona fide effort to secure a loan after receiving a fee for such service, shall
constitute default by the mortgage loan company and any other person so in default;
and any person damaged by such default may sue at law or equity for damages,
reasonable attorneys' fees and interest at the legal rate of interest under KRS
360.010. Every cause of action for damages under this subsection survives the death
of any person who might have been a plaintiff or defendant. No person may sue
under this subsection more than five (5) years after any act constituting default. Effective: July 15, 2010
History: Amended 2010 Ky. Acts ch. 24, sec. 777, effective July 15, 2010. -- Amended 1998 Ky. Acts ch. 197, sec. 12, effective July 15, 1998. -- Amended 1986 Ky. Acts
ch. 461, sec. 15, effective July 15, 1986. -- Created 1980 Ky. Acts ch. 365, sec. 13,
effective July 15, 1980. Formerly codified as KRS 294.120.
Legislative Research Commission Note (7/12/2006). In accordance with 2006 Ky. Acts ch. 247, secs. 38 and 39, this statute has been renumbered as a section of the
Kentucky Financial Services Code, KRS Chapter 286.
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