§ 12-109. Escrow accounts
West's Annotated Code of MarylandCommercial LawEffective: October 1, 2018
Effective: October 1, 2018
MD Code, Commercial Law, § 12-109
§ 12-109. Escrow accounts
1. Assessed on an owner of residential real property that is served by public water or wastewater facilities for which deferred water or sewer charges have been established by a recorded covenant or declaration to cover or defray the cost of installing or maintaining during construction all or part of the public water or wastewater facilities constructed by the developer; and
(b)(1) A lending institution which lends money secured by a first mortgage or first deed of trust on any interest in residential real property and creates or is the assignee of an escrow account in connection with that loan shall pay interest to the borrower on the funds in the escrow account at an annual rate not less than the weekly average yield on United States Treasury securities adjusted to a constant maturity of 1 year, as published by the Federal Reserve in “Selected Interest Rates (Daily)--H.15”, as of the first business day of the calendar year.
(c) The provisions of this section do not apply to a lending institution which provides for the payment of taxes, insurance, water and sewer facilities assessments, or other expenses under the direct reduction method by which these expenses, when paid by the lender, are added to the outstanding principal balance of the loan.
(d) This section does not apply if the loan is purchased by an out-of-state lender through the Federal National Mortgage Association, the Government National Mortgage Association, or the Federal Home Loan Mortgage Corporation and the out-of-state lender as a condition of purchase elects to service the loan. However, this section shall apply if the out-of-state lender sells the loan to a Maryland lender or places the loan with a Maryland lender for servicing.
(e) On request of a borrower, a lending institution that lends money secured by a first mortgage or first deed of trust on any interest in residential real property may, at the option of the lending institution, create an escrow account in connection with that loan solely for the payment of water and sewer facilities assessments.
Credits
Added by Acts 1975, c. 49, § 3, eff. July 1, 1975. Amended by Acts 1976, c. 66; Acts 1977, c. 106; Acts 1986, c. 628; Acts 2011, c. 611, § 1, eff. Oct. 1, 2011; Acts 2012, c. 528, § 1, eff. June 1, 2012; Acts 2012, c. 529, § 1, eff. June 1, 2012; Acts 2013, c. 43, § 5; Acts 2014, c. 306, § 1, eff. June 1, 2014; Acts 2018, c. 340, § 1, eff. Oct. 1, 2018.
Formerly Art. 49, § 13.
MD Code, Commercial Law, § 12-109, MD COML § 12-109
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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