§ 12-118. Changing interest or finance charges
West's Annotated Code of MarylandCommercial Law
MD Code, Commercial Law, § 12-118
§ 12-118. Changing interest or finance charges
A lender may not enter into a loan agreement, providing for an initial interest rate pursuant to § 12-103(a) and (c) of this subtitle or § 12-306 or § 12-404 of this title, which contains a provision that permits the lender to increase or decrease the applicable rate of interest or finance charges from time to time during the term of the obligation, unless:
1. The amount of increase in any 6 month period may not be more than the equivalent of 1 percentage point above the rate in effect prior to the rate change.
2. Notwithstanding subparagraph (i) of this paragraph, if the rate of change in any index so allows, the rate may be increased to not more than the originally contracted for rate if authorized by the loan agreement. The agreed upon additional increases must comply with subparagraph (i).
3. Notwithstanding subparagraph (i) of this paragraph, the lender may decrease the rate at any time and by any amount;
(3) Interest rate decreases warranted by decreases in the agreed upon index shall be mandatory except to the extent that past increases in the index have not been implemented by the lender, either at his option or because the lender was subject to the rate change limitation of paragraph (2) of this section;
Credits
Added by Acts 1982, c. 753, § 1, eff. July 1, 1982. Amended by Acts 1992, c. 22, § 1; Acts 1993, c. 5, § 1; Acts 1994, c. 549, § 1, eff. Oct. 1, 1994; Acts 2013, c. 43, § 5.
MD Code, Commercial Law, § 12-118, MD COML § 12-118
Current through legislation effective through April 9, 2023, from the 2024 Regular Session of the General Assembly. Some statute sections may be more current, see credits for details.
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