57-15-8 — Procedure for assumption -- Request to lender -- Effect of failure to request -- Approval or refusal by lender -- Information furnished by lender.
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57-15-8. Procedure for assumption -- Request to lender -- Effect of failure to
request -- Approval or refusal by lender -- Information furnished by lender.
(1) In order to effect an assumption under this chapter the original borrower, or, if the secured party has previously approved, and pursuant to that approval there has been effected, an assumption of the indebtedness secured by an instrument representing a security interest in real estate, the person last approved as an assumer and who has assumed the indebtedness shall give to the lender a written notice and request for assumption. The lender shall either approve or reject a prospective assumer within 30 days after the written notice and request for assumption is received from the original borrower or the party last approved as an assumer. The lender may refuse to release the original borrower or the party last approved as an assumer and who has assumed if the secured party has previously approved the assumption of the indebtedness, from liability for the payment of the indebtedness to be assumed. With respect to any transfer involving an assumption effected after the effective date of this act, if the written notice and request for an assumption is not timely made before a transfer or within 90 days after transfer, the lender may call the entire loan balance due without a determination that the security interest is substantially impaired, if that option is provided for in the original loan agreement.
(2) The lender shall provide the original borrower or, if the indebtedness has been assumed with the previous approval of the lender, the person last approved with a statement of loan condition within 14 days after receipt of written notice and request. The statement shall include the following information: (a) the amount of the unpaid balance on the secured loan; (b) the interest rate; (c) the amount of the monthly loan installment; (d) the date or dates any real estate taxes and special assessments were last paid; (e) the amount of hazard insurance in effect if that information is contained in the records of the lender; and (f) the amount of any impound balance reserve for payments of taxes, special assessments, and insurance.
(1) In order to effect an assumption under this chapter the original borrower, or, if the secured party has previously approved, and pursuant to that approval there has been effected, an assumption of the indebtedness secured by an instrument representing a security interest in real estate, the person last approved as an assumer and who has assumed the indebtedness shall give to the lender a written notice and request for assumption. The lender shall either approve or reject a prospective assumer within 30 days after the written notice and request for assumption is received from the original borrower or the party last approved as an assumer. The lender may refuse to release the original borrower or the party last approved as an assumer and who has assumed if the secured party has previously approved the assumption of the indebtedness, from liability for the payment of the indebtedness to be assumed. With respect to any transfer involving an assumption effected after the effective date of this act, if the written notice and request for an assumption is not timely made before a transfer or within 90 days after transfer, the lender may call the entire loan balance due without a determination that the security interest is substantially impaired, if that option is provided for in the original loan agreement.
(2) The lender shall provide the original borrower or, if the indebtedness has been assumed with the previous approval of the lender, the person last approved with a statement of loan condition within 14 days after receipt of written notice and request. The statement shall include the following information: (a) the amount of the unpaid balance on the secured loan; (b) the interest rate; (c) the amount of the monthly loan installment; (d) the date or dates any real estate taxes and special assessments were last paid; (e) the amount of hazard insurance in effect if that information is contained in the records of the lender; and (f) the amount of any impound balance reserve for payments of taxes, special assessments, and insurance.
Enacted by Chapter 224, 1981 General Session