Citations Affected: IC 4-6; IC 5-20-1; IC 23-2-5; IC 24-9; IC 34-7-4-2; IC 36-2-7-10.
Synopsis: Home loan practices. Restricts certain lending acts and
practices. Establishes the homeowner protection unit in the office of
the attorney general. Provides enforcement procedures for deceptive
mortgage acts. Establishes a $3 mortgage recording fee. Requires the
Indiana housing finance authority to provide home ownership training
programs. Appropriates $75,000 to the legislative council to contract
for a study of predatory lending and the high rate of foreclosure in
Indiana. Establishes an interim study committee on mortgage lending
Effective: Upon passage; July 1, 2004.
January 20, 2004, read first time and referred to Committee on Judiciary.
A BILL FOR AN ACT to amend the Indiana Code concerning trade
regulations; consumer sales and credit and to make an appropriation.
[EFFECTIVE JULY 1, 2004]: Sec. 4. (a) The authority has all of the
powers necessary or convenient to carry out and effectuate the purposes
and provisions of this chapter including the power:
(1) to make or participate in the making of construction loans to sponsors of multiple family residential housing that is federally assisted or assisted by a government sponsored enterprise, such as the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation, or the Federal Agricultural Mortgage Corporation, the Federal Home Loan Bank, and other similar entities approved by the authority;
(2) to make or participate in the making of mortgage loans to sponsors of multiple family residential housing that is federally assisted or assisted by a government sponsored enterprise, such as the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation, or the Federal Agricultural Mortgage Corporation, the Federal Home Loan Bank, and other similar entities approved by the authority;
(3) to purchase or participate in the purchase from mortgage lenders of mortgage loans made to persons of low and moderate income for residential housing;
(4) to make loans to mortgage lenders for the purpose of furnishing funds to such mortgage lenders to be used for making mortgage loans for persons and families of low and moderate income. However, the obligation to repay loans to mortgage lenders shall be general obligations of the respective mortgage lenders and shall bear such date or dates, shall mature at such time or times, shall be evidenced by such note, bond, or other certificate of indebtedness, shall be subject to prepayment, and shall contain such other provisions consistent with the purposes of this chapter as the authority shall by rule or resolution determine;
(5) to collect and pay reasonable fees and charges in connection with making, purchasing, and servicing of its loans, notes, bonds, commitments, and other evidences of indebtedness;
(6) to acquire real property, or any interest in real property, by conveyance, including purchase in lieu of foreclosure, or foreclosure, to own, manage, operate, hold, clear, improve, and rehabilitate such real property and sell, assign, exchange, transfer, convey, lease, mortgage, or otherwise dispose of or encumber such real property where such use of real property is necessary or appropriate to the purposes of the authority;
(7) to sell, at public or private sale, all or any part of any mortgage
or other instrument or document securing a construction loan, a
land development loan, a mortgage loan, or a loan of any type
permitted by this chapter;
(8) to procure insurance against any loss in connection with its operations in such amounts and from such insurers as it may deem necessary or desirable;
(9) to consent, subject to the provisions of any contract with noteholders or bondholders which may then exist, whenever it deems it necessary or desirable in the fulfillment of its purposes to the modification of the rate of interest, time of payment of any installment of principal or interest, or any other terms of any mortgage loan, mortgage loan commitment, construction loan, loan to lender, or contract or agreement of any kind to which the authority is a party;
(10) to enter into agreements or other transactions with any federal, state, or local governmental agency for the purpose of providing adequate living quarters for such persons and families in cities and counties where a need has been found for such housing;
(11) to include in any borrowing such amounts as may be deemed necessary by the authority to pay financing charges, interest on the obligations (for a period not exceeding the period of construction and a reasonable time thereafter or if the housing is completed, two (2) years from the date of issue of the obligations), consultant, advisory, and legal fees and such other expenses as are necessary or incident to such borrowing;
(12) to make and publish rules respecting its lending programs and such other rules as are necessary to effectuate the purposes of this chapter;
(13) to provide technical and advisory services to sponsors, builders, and developers of residential housing and to residents and potential residents, including housing selection and purchase procedures, family budgeting, property use and maintenance, household management, and utilization of community resources;
(14) to promote research and development in scientific methods of constructing low cost residential housing of high durability;
(15) to encourage community organizations to participate in residential housing development;
(16) to make, execute, and effectuate any and all agreements or other documents with any governmental agency or any person, corporation, association, partnership, limited liability company, or other organization or entity necessary or convenient to
accomplish the purposes of this chapter;
(17) to accept gifts, devises, bequests, grants, loans, appropriations, revenue sharing, other financing and assistance, and any other aid from any source whatsoever and to agree to, and to comply with, conditions attached thereto;
(18) to sue and be sued in its own name, plead and be impleaded;
(19) to maintain an office in the city of Indianapolis and at such other place or places as it may determine;
(20) to adopt an official seal and alter the same at pleasure;
(21) to adopt and from time to time amend and repeal bylaws for the regulation of its affairs and the conduct of its business and to prescribe rules and policies in connection with the performance of its functions and duties;
(22) to employ fiscal consultants, engineers, attorneys, real estate counselors, appraisers, and such other consultants and employees as may be required in the judgment of the authority and to fix and pay their compensation from funds available to the authority therefor;
(23) to invest any funds held in reserve or in sinking fund accounts or any money not required for immediate disbursement in obligations of the state, the United States, or their agencies or instrumentalities and such other obligors as may be permitted under the terms of any resolution authorizing the issuance of the authority's obligations;
(24) to make or participate in the making of construction loans, mortgage loans, or both, to individuals, partnerships, limited liability companies, corporations, and organizations for the construction of residential facilities for the developmentally disabled or for the mentally ill or for the acquisition or renovation, or both, of a facility to make it suitable for use as a new residential facility for the developmentally disabled or for the mentally ill;
(25) to make or participate in the making of construction and mortgage loans to individuals, partnerships, corporations, limited liability companies, and organizations for the construction, rehabilitation, or acquisition of residential facilities for children;
(26) to purchase or participate in the purchase of mortgage loans from:
(A) public utilities (as defined in IC 8-1-2-1); or
(B) municipally owned gas utility systems organized under IC 8-1.5;
if those mortgage loans were made for the purpose of insulating
and otherwise weatherizing single family residences in order to
conserve energy used to heat and cool those residences;
(27) to provide financial assistance to mutual housing associations (IC 5-20-3) in the form of grants, loans, or a combination of grants and loans for the development of housing for low and moderate income families;
(28) to service mortgage loans made or acquired by the authority and to impose and collect reasonable fees and charges in connection with such servicing; and
(29) to identify, promote, assist, and fund home ownership training programs throughout Indiana, and adopt rules under IC 4-22-2 governing certification procedures and counseling requirements for nonprofit home ownership counselors.
(b) The authority shall structure and administer any program conducted under subsection (a)(3) or (a)(4) in order to assure that no mortgage loan shall knowingly be made to a person whose adjusted family income shall exceed one hundred twenty-five percent (125%) of the median income for the geographic area within which the person resides and at least forty percent (40%) of the mortgage loans so financed shall be for persons whose adjusted family income shall be below eighty percent (80%) of the median income for such area.
(c) In addition to the powers set forth in subsection (a), the authority may, with the proceeds of bonds and notes sold to retirement plans covered by IC 5-10-1.7, structure and administer a program of purchasing or participating in the purchasing from mortgage lenders of mortgage loans made to qualified members of retirement plans and other individuals. The authority shall structure and administer any program conducted under this subsection to assure that:
(1) each mortgage loan is made as a first mortgage loan for real property:
(A) that is a single family dwelling, including a condominium or townhouse, located in Indiana;
(B) for a purchase price of not more than ninety-five thousand dollars ($95,000);
(C) to be used as the purchaser's principal residence; and
(D) for which the purchaser has made a down payment in an amount determined by the authority;
(2) no mortgage loan exceeds seventy-five thousand dollars ($75,000);
(3) any bonds or notes issued which are backed by mortgage loans purchased by the authority under this subsection shall be offered for sale to the retirement plans covered by IC 5-10-1.7; and
liability partnership, a sole proprietorship, a joint venture, a joint stock
company, or another group or entity, however organized.
(i) As used in this chapter, "registrant" means an individual who is registered to engage in origination activities under this chapter.
(j) As used in this chapter, "ultimate equitable owner" means a person who, directly or indirectly, owns or controls any ownership interest in a person, regardless of whether the person owns or controls the ownership interest through one (1) or more other persons or one (1) or more proxies, powers of attorney, or variances.
(3) The services provided by a loan broker in procuring possible business for a lending institution if the fees are paid by the lending institution.
(c) As used in this section, "successful procurement of a loan" means that a binding commitment from a creditor to advance money has been received and accepted by the borrower.
(d) The burden of proof of any exemption or classification provided in this chapter is on the party claiming the exemption or classification.
of the loan discount points reduces the interest charged on the
scheduled payments so that the borrower's dollar amount of
savings in interest during the first four (4) years of the loan is equal
to or greater than the dollar amount of loan discount points paid
by the borrower.
Sec. 4. "Borrower" means a person obligated to repay a home loan, including a coborrower, cosigner, or guarantor.
Sec. 5. "Bridge loan" means temporary or short term financing with a maturity of less than eighteen (18) months that requires payments of interest only until the entire unpaid balance is due and payable.
Sec. 6. (a) "Creditor" means:
(1) a person:
(A) who regularly extends consumer credit that is subject to a finance charge or that is payable by written agreement in more than four (4) installments; and
(B) to whom the debt arising from a home loan transaction is initially payable; or
(2) a person who brokers a home loan, including a person who:
(A) directly or indirectly solicits, processes, places, or negotiates home loans for others;
(B) offers to solicit, process, place, or negotiate home loans for others; or
(C) closes home loans that may be in the person's own name with funds provided by others and that are thereafter assigned to the person providing funding for the loans.
(b) The term does not include:
(1) a servicer;
(2) a state or local housing finance authority;
(3) any other state or local governmental or quasi-governmental entity; or
(4) an attorney providing legal services in association with the closing of a home loan.
Sec. 7. "Deceptive act" means an act or a practice as part of a consumer credit mortgage transaction involving real property located in Indiana in which a creditor, a mortgage broker, or a real estate appraiser who assists in or is a part of the consumer credit mortgage transaction knowingly or intentionally:
(1) makes a material misrepresentation to a borrower;
(2) conceals or obscures material information from the
borrower regarding the terms or conditions of the
(3) consummates the consumer credit mortgage transaction with the knowledge that the borrower will be unable to successfully fulfill the terms or conditions of the mortgage loan based on the borrower's finances at the time of the consummation; or
(4) includes terms or conditions in the mortgage loan that substantially increase the likelihood of default.
Sec. 8. "Flipping" means the refinancing of an existing home loan, resulting in a new home loan that does not have a reasonable tangible net benefit to the borrower considering all the circumstances, including the terms of both the new and refinanced home loans, the cost of the new home loan, and the borrower's circumstances.
Sec. 9. "High cost home loan" means a home loan with:
(1) a trigger rate that exceeds the benchmark rate; or
(2) total points and fees that exceed five percent (5%) of the loan principal.
Sec. 10. "Home loan" means a loan, other than a reverse mortgage transaction, that is secured by a:
(1) mortgage or deed of trust on real estate in Indiana on which there is located or will be located a structure or structures:
(A) designed primarily for occupancy of one (1) to four (4) families; and
(B) that is or will be occupied by a borrower as the borrower's principal dwelling; or
(2) security interest on a manufactured home that is or will be occupied by a borrower as the borrower's principal dwelling.
Sec. 11. (a) "Manufactured home" means a structure that is:
(1) transportable in one (1) or more sections that are greater than or equal to:
(A) eight (8) body feet in width; or
(B) forty (40) body feet in length;
(2) built on a permanent chassis; and
(3) designed to be used as a dwelling:
(A) with a permanent foundation when erected on land secured in conjunction with the real property on which the manufactured home is located;
(B) that is connected to utilities; and
(C) that contains plumbing, heating, and electrical systems.
that are included in the principal amount of the loan; or
(2) the total line of credit allowed under the home loan for an open-end loan.
Sec. 15. "Trigger rate" means:
(1) for fixed rate home loans in which the interest rate will not vary during the term of the loan, the rate as of the date of closing;
(2) for home loans in which the interest varies according to an index, the sum of the index rate as of the date of closing plus the maximum margin permitted at any time under the loan agreement; or
(3) for all other home loans in which the rate may vary at any time during the term of the loan, the maximum rate that may be charged during the term of the home loan.
Chapter 3. Prohibited Lending Practices Generally
Sec. 1. (a) A creditor making a home loan may not finance, directly or indirectly, any:
(1) credit life insurance;
(2) credit disability insurance;
(3) credit unemployment insurance;
(4) credit property insurance;
(5) other life or health insurance; or
(6) payments directly or indirectly for any cancellation suspension agreement or contract.
(b) Insurance premiums, debt cancellation fees, or suspension fees calculated and paid on a monthly basis are not considered to be financed by the creditor for purposes of this chapter.
Sec. 2. A creditor may not engage in the act or practice of flipping a home loan. A creditor is presumed not to be engaged in the act or practice of flipping a home loan if the creditor refinances an existing home loan and:
(1) no points and fees are payable in connection with the part of the proceeds of the new home loan that is used to refinance the existing home loan; and
(2) the points and fees payable in connection with the part of the proceeds of the new home loan that exceeds the proceeds described in subdivision (1) are not more than five percent (5%) of the proceeds described in this subdivision.
Sec. 3. A creditor may not recommend or encourage default on an existing loan or other debt before and in connection with the closing or planned closing of a home loan that refinances all or part of the existing loan or debt.
of a home loan agreement that:
(1) requires arbitration of a claim or defense;
(2) allows a party to require a borrower to assert a claim or defense in a forum that is:
(A) less convenient;
(B) more costly; or
(C) more dilatory;
for the resolution of the dispute than an Indiana court in which the borrower may otherwise bring a claim or defense; or
(3) limits in any way any claim or defense the borrower may have;
is unconscionable and void.
Sec. 8. A creditor may not:
(1) divide a loan transaction into separate parts with the intent of evading a provision of this article;
(2) structure a home loan transaction as an open-end loan with the intent of evading the provisions of this article if the loan would be a high cost home loan if the loan had been structured as a closed-end loan;
(3) engage in a deceptive act when making a home loan; or
(4) engage in any other subterfuge with the intent of evading a provision of this article.
Sec. 9. It is unlawful for a creditor to discriminate against any applicant with respect to any aspect of a credit transaction on the basis of race, color, religion, national origin, sex, marital status, or age, if the applicant has the ability to contract.
Chapter 4. Additional Prohibitions for High Cost Home Loans
Sec. 1. The following additional limitations and prohibited practices apply to a high cost home loan:
(1) A creditor making a high cost home loan may not directly or indirectly finance any points and fees.
(2) Prepayment fees or penalties may not be included in the loan documents for a high cost home loan or charged to the borrower if the fees or penalties exceed in total two percent (2%) of the high cost home loan amount prepaid during the first twenty-four (24) months after the high cost home loan closing.
(3) A prepayment penalty may not be contracted for after the second year following the high cost home loan closing.
(4) A creditor may not include a prepayment penalty fee in a high cost home loan unless the creditor offers the borrower
the option of choosing a loan product without a prepayment
fee. The terms of the offer must be made in writing and must
be initialed by the borrower. The document containing the
offer must be clearly labeled in large bold type and must
include the following disclosure:
"LOAN PRODUCT CHOICE
I was provided with an offer to accept a product both with and without a prepayment penalty provision. I have chosen to accept the product with a prepayment penalty.".
Sec. 2. Notwithstanding IC 24-4.5-3-402, a high cost home loan agreement may not require a scheduled payment that is more than twice as large as the average of earlier scheduled monthly payments under the high cost home loan agreement unless the payment becomes due and payable at least one hundred twenty (120) months after the date of the high cost home loan. This prohibition does not apply if:
(1) the payment schedule is adjusted to account for the seasonal or irregular income of the borrower; or
(2) the loan is a bridge loan connected with or related to the acquisition or construction of a dwelling intended to become the obligor's principal dwelling.
Sec. 3. A high cost home loan may not include payment terms under which the outstanding principal balance will increase at any time over the course of the high cost home loan because the regular periodic payments do not cover the full amount of interest due.
Sec. 4. A high cost home loan may not contain a provision that increases the interest rate after default. However, this section does not apply to interest rate changes in a variable rate loan otherwise consistent with the provisions of the high cost home loan documents if the change in the interest rate is not triggered by the event of default or the acceleration of the indebtedness.
Sec. 5. A high cost home loan may not include terms under which more than two (2) periodic payments required under the high cost home loan are consolidated and paid in advance from the high cost home loan proceeds provided to the borrower.
Sec. 6. A creditor may not make a high cost home loan without first providing the borrower information to facilitate contact with a nonprofit counseling agency certified by:
(1) the United States Department of Housing and Urban Development; or
(2) the Indiana housing finance authority under IC 5-20-1-15.5;
TO OBTAIN A LOAN AT A LOWER COST. YOU SHOULD
COMPARE LOAN RATES, COSTS, AND FEES.
MORTGAGE LOAN RATES AND CLOSING COSTS AND
FEES VARY BASED ON MANY FACTORS, INCLUDING
YOUR PARTICULAR CREDIT AND FINANCIAL
CIRCUMSTANCES, YOUR EMPLOYMENT HISTORY,
THE LOAN-TO-VALUE REQUESTED, AND THE TYPE
OF PROPERTY THAT WILL SECURE YOUR LOAN. THE
LOAN RATE, COSTS, AND FEES COULD ALSO VARY
BASED ON WHICH CREDITOR OR BROKER YOU
IF YOU ACCEPT THE TERMS OF THIS LOAN, THE CREDITOR WILL HAVE A MORTGAGE LIEN ON YOUR HOME. YOU COULD LOSE YOUR HOME AND ANY MONEY YOU HAVE PAID IF YOU DO NOT MEET YOUR PAYMENT OBLIGATIONS UNDER THE LOAN.
YOU SHOULD CONSULT AN ATTORNEY AND A QUALIFIED INDEPENDENT CREDIT COUNSELOR OR OTHER EXPERIENCED FINANCIAL ADVISER REGARDING THE RATE, FEES, AND PROVISIONS OF THIS MORTGAGE LOAN BEFORE YOU PROCEED. A LIST OF QUALIFIED COUNSELORS IS AVAILABLE FROM THE INDIANA HOUSING FINANCE AUTHORITY.
YOU ARE NOT REQUIRED TO COMPLETE THIS LOAN AGREEMENT MERELY BECAUSE YOU HAVE RECEIVED THIS DISCLOSURE OR HAVE SIGNED A LOAN APPLICATION. REMEMBER, PROPERTY TAXES AND HOMEOWNER'S INSURANCE ARE YOUR RESPONSIBILITY. NOT ALL CREDITORS PROVIDE ESCROW SERVICES FOR THESE PAYMENTS. YOU SHOULD ASK YOUR CREDITOR ABOUT THESE SERVICES.
ALSO, YOUR PAYMENTS ON EXISTING DEBTS CONTRIBUTE TO YOUR CREDIT RATINGS. YOU SHOULD NOT ACCEPT ANY ADVICE TO IGNORE YOUR REGULAR PAYMENTS TO YOUR EXISTING CREDITORS.".
Chapter 5. Claims, Defenses, Remedies
Sec. 1. (a) A person who purchases or is otherwise assigned a high cost home loan is subject to all affirmative claims and any defenses with respect to the high cost home loan that the borrower could assert against a creditor or broker of the high cost home
loan. However, this section does not apply if the purchaser or
assignee demonstrates by a preponderance of the evidence that a
reasonable person exercising ordinary due diligence could not
determine that the loan was a high cost home loan. A purchaser or
an assignee is presumed to have exercised reasonable due diligence
if the purchaser or assignee:
(1) has in place at the time of the purchase or assignment of the subject loans, policies that expressly prohibit the purchase or acceptance of the assignment of any high cost home loans;
(2) requires by contract that a seller or an assignor of home loans to the purchaser or assignee represents and warrants to the purchaser or assignee that either:
(A) the seller or assignor will not sell or reassign any high cost home loans to the purchaser or assignee; or
(B) the seller or assignor is a beneficiary of a representation and warranty from a previous seller or assignor to that effect;
(3) exercises reasonable due diligence:
(A) at the time of purchase or assignment of home loans; or
(B) within a reasonable period after the purchase or assignment of home loans;
intended by the purchaser or assignee to prevent the purchaser or assignee from purchasing or taking assignment of any high cost home loans; or
(4) satisfies the requirements of subdivisions (1) and (2) and establishes that a reasonable person exercising ordinary due diligence could not determine that the loan was a high cost home loan based on the:
(A) documentation required by the federal Truth in Lending Act (15 U.S.C. 1601 et seq.); and
(B) itemization of the amount financed and other disbursement disclosures.
(b) A borrower acting only in an individual capacity may assert against the creditor or any subsequent holder or assignee of a home loan:
(1) a violation of IC 24-9-3-2 as a defense, claim, or counterclaim, after:
(A) an action to enjoin foreclosure or to preserve or obtain possession of the dwelling that secures the loan is initiated;
(B) an action to collect on the loan or foreclose on the collateral securing the loan is initiated; or
located. The borrower has the right to assert in the proceeding the
nonexistence of a default and any other claim or defense to
acceleration and foreclosure, including any claim or defense based
on any violations of this article.
(b) This section is not intended and shall not be construed to allow any claim or defense otherwise barred by any statute of limitation or repose.
Sec. 4. (a) A person who violates this article is liable to the borrower for the following:
(1) Actual damages, including consequential damages. The borrower is not required to demonstrate reliance in order to receive actual damages.
(2) Statutory damages equal to two (2) times the finance charges agreed to in the home loan agreement.
(3) Punitive damages, if the violation was malicious or reckless.
(4) Costs and reasonable attorney's fees.
(b) A borrower may be granted injunctive, declaratory, and other equitable relief as the court determines appropriate in an action to enforce compliance with this chapter.
(c) The right of rescission granted under 15 U.S.C. 1601 et seq. for a violation of law is available to a borrower acting only in an individual capacity by way of recoupment as a defense against a party foreclosing on a home loan at any time during the term of the loan. Any recoupment claim asserted under this provision is limited to the amount required to reduce or extinguish the borrower's liability under the home loan plus amounts required to recover costs, including reasonable attorney's fees. This article shall not be construed to limit the recoupment rights available to a borrower under any other law.
(d) The remedies provided in this section are cumulative but are not intended to be the exclusive remedies available to a consumer. A consumer is not required to exhaust any administrative remedies under this article or under any other applicable law.
(e) The knowing or intentional violation of this article or a rule adopted under the authority of this article renders the home loan agreement void, and the creditor has no right to collect, receive, or retain any principal, interest, or other charges with respect to the loan. The borrower may recover any payments made under the agreement.
(f) An award of damages under subsection (a) has priority over a civil penalty imposed under this article.
Sec. 5. (a) If the creditor or an assignee establishes by a preponderance of evidence that a violation of this article is unintentional or the result of a bona fide error of law or fact notwithstanding the maintenance of procedures reasonably adopted to avoid any such violation or error, the validity of the transaction is not affected, and no liability is imposed under section 4 of this chapter except in the case of a refusal to make a refund.
(b) Except as provided in subsection (c), a creditor in a high cost home loan who in good faith fails to comply with this article is not considered to have violated this article if the creditor does the following before receiving notice of the compliance failure from the borrower:
(1) Not later than thirty (30) days after the date of the loan closing, makes:
(A) appropriate restitution to the borrower of any amounts collected in error; and
(B) all appropriate adjustments to the loan to correct the error.
(2) Not later than sixty (60) days after the date of the loan closing, notifies the borrower of:
(A) the compliance error; and
(B) the amount of the required restitution or adjustment.
(c) Subsection (b) does not apply unless the creditor establishes that the compliance failure was not intentional and resulted from a bona fide error, notwithstanding the maintenance of procedures reasonably adopted to avoid the errors. For purposes of this subsection, "bona fide errors" include clerical errors, calculation errors, computer malfunction and programming errors, and printing errors. An error of legal judgment with respect to a person's obligations under this article is not a bona fide error for purposes of this subsection.
Sec. 6. The rights conferred by this article are in addition to rights granted under any other law.
Chapter 6. Reporting Requirements
Sec. 1. (a) A servicer of a high cost home loan shall report at least monthly to a nationally recognized consumer credit reporting agency both the favorable and unfavorable payment history information of the borrower on payments due to the creditor on a high cost home loan.
(b) This section does not prohibit a servicer from agreeing with the borrower not to report specified payment history information in the event of a resolved or an unresolved dispute with a borrower
and does not apply to high cost home loans held or serviced by a
lender for less than ninety (90) days.
Chapter 7. Penalties and Enforcement
Sec. 1. A person who knowingly or intentionally violates this article commits:
(1) a Class A misdemeanor; and
(2) an act that is actionable by the attorney general under IC 24-5-0.5 and is subject to the penalties listed in IC 24-5-0.5.
Sec. 2. (a) The attorney general and the attorney general's homeowner protection unit established under IC 4-6-12 shall enforce this article for any violation occurring within five (5) years after the making of a home loan.
(b) The attorney general may refer a matter under section 1 of this chapter to a prosecuting attorney for enforcement.
Sec. 3. (a) The attorney general may bring an action to enjoin a violation of this article. A court in which the action is brought may:
(1) issue an injunction;
(2) order a person to make restitution;
(3) void or limit the application of obligations that violate this article;
(4) order a person to reimburse the state for reasonable costs of the attorney general's investigation and prosecution of the violation of this article; and
(5) impose a civil penalty of not more than fifteen thousand dollars ($15,000) per violation.
(b) A person who violates an injunction under this section is subject to a civil penalty of not more that fifteen thousand dollars ($15,000) per violation.
(c) The court that issues an injunction retains jurisdiction over a proceeding seeking the imposition of a civil penalty under this section.
Sec. 4. The attorney general may file complaints with any of the agencies listed in IC 4-6-12-4 to implement this chapter.
Chapter 8. Fees
Sec. 1. The county recorder shall assess a fee of three dollars ($3) under IC 36-2-7-10(b)(11) for each mortgage recorded. The fee shall be paid to the county treasurer at the end of each calendar month as provided in IC 36-2-7-10(a).
Sec. 2. The county treasurer shall credit fifty cents ($0.50) of the fee collected under IC 36-2-7-10(b)(11) for each mortgage recorded to the county recorder's records perpetuation fund established under IC 36-2-7-10(c).
Sec. 3. On or before June 20 and December 20 of each year, after completing an audit of the county treasurer's monthly reports required by IC 36-2-10-16, the county auditor shall distribute to the auditor of state two dollars and fifty cents ($2.50) of the mortgage recording fee collected under IC 36-2-7-10(b)(11) for each mortgage recorded by the county recorder.
Sec. 4. The auditor of state shall distribute one dollar and twenty-five cents ($1.25) of the mortgage recording fee to the home ownership training account established by IC 5-20-1-15.6. The auditor of state shall credit one dollar and twenty-five cents ($1.25) of the mortgage recording fee to the homeowner protection unit account established by IC 4-6-12-10.
the county recorder.
(b) The county recorder shall charge the following:
(1) Six dollars ($6) for the first page and two dollars ($2) for each additional page of any document the recorder records if the pages are not larger than eight and one-half (8 1/2) inches by fourteen (14) inches.
(2) Fifteen dollars ($15) for the first page and five dollars ($5) for each additional page of any document the recorder records, if the pages are larger than eight and one-half (8 1/2) inches by fourteen (14) inches.
(3) For attesting to the release, partial release, or assignment of any mortgage, judgment, lien, or oil and gas lease contained on a multiple transaction document, the fee for each transaction after the first is the amount provided in subdivision (1) plus the amount provided in subdivision (4) and one dollar ($1) for marginal mortgage assignments or marginal mortgage releases.
(4) One dollar ($1) for each cross-reference of a recorded document.
(5) One dollar ($1) per page not larger than eight and one-half (8 1/2) inches by fourteen (14) inches for furnishing copies of records produced by a photographic process, and two dollars ($2) per page that is larger than eight and one-half (8 1/2) inches by fourteen (14) inches.
(6) Five dollars ($5) for acknowledging or certifying to a document.
(7) Five dollars ($5) for each deed the recorder records, in addition to other fees for deeds, for the county surveyor's corner perpetuation fund for use as provided in IC 32-19-4-3 or IC 36-2-12-11(e).
(8) A fee in an amount authorized under IC 5-14-3-8 for transmitting a copy of a document by facsimile machine.
(9) A fee in an amount authorized by an ordinance adopted by the county legislative body for duplicating a computer tape, a computer disk, an optical disk, microfilm, or similar media. This fee may not cover making a handwritten copy or a photocopy or using xerography or a duplicating machine.
(10) A supplemental fee of three dollars ($3) for recording a document that is paid at the time of recording. The fee under this subdivision is in addition to other fees provided by law for recording a document.
(11) Three dollars ($3) for each mortgage on real estate recorded, in addition to other fees required by this section,
distributed as follows:
(A) Fifty cents ($0.50) is to be deposited in the recorder's record perpetuation fund.
(B) Two dollars and fifty cents ($2.50) is to be distributed to the auditor of state on or before June 20 and December 20 of each year as provided in IC 24-9-8-4.
(c) The county treasurer shall establish a recorder's records perpetuation fund. All revenue received under subsection (b)(5), (b)(8), (b)(9), and (b)(10), and fifty cents ($0.50) from revenue received under subsection (b)(11), shall be deposited in this fund. The county recorder may use any money in this fund without appropriation for the preservation of records and the improvement of record keeping systems and equipment.
(d) As used in this section, "record" or "recording" includes the functions of recording, filing, and filing for record.
(e) The county recorder shall post the fees set forth in subsection (b) in a prominent place within the county recorder's office where the fee schedule will be readily accessible to the public.
(f) The county recorder may not tax or collect any fee for:
(1) recording an official bond of a public officer, a deputy, an appointee, or an employee; or
(2) performing any service under any of the following:
(A) IC 6-1.1-22-2(c).
(B) IC 8-23-7.
(C) IC 8-23-23.
(D) IC 10-17-2-3.
(E) IC 10-17-3-2.
(F) IC 12-14-13.
(G) IC 12-14-16.
(g) The state and its agencies and instrumentalities are required to pay the recording fees and charges that this section prescribes.
account established by IC 4-6-12-10, as added by this act, may be
made by the attorney general before the transfer of the
seventy-five thousand dollars ($75,000) appropriated by this
SECTION to the legislative council.
(c) The results of the study must be reported in an electronic format under IC 5-14-6 to the legislative council not later than December 31, 2006.
(d) This SECTION expires January 1, 2007.