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Can you summarize 9-A MERS Section 3-308?
LIMITATIONS ON AGREEMENTS AND PRACTICES > Schedule of payments; balloon payments
Short Summary
This document, part of the Maine Consumer Credit Code, regulates consumer credit transactions with multiple payments of principal. It prohibits creditors from contracting for or receiving payments of principal and interest under a schedule of payments where any one payment is not substantially equal to all other payments, or where the intervals between consecutive payments differ substantially. However, there are exceptions for consumers with seasonal or intermittent income, allowing for reduced or expanded payments or intervals based on expected income. The document also allows for the deferral of the first periodic payment for up to 12 months, with no interest or costs accruing beyond 120 days. Additionally, if the consumer credit transaction is for a term of at least 4 years, the final payment may be different from other periodic payments if the consumer has the right to refinance it on terms offered by the creditor. The document does not specify any penalties for non-compliance.
Whom does it apply to?
Creditors and consumers involved in consumer credit transactions
What does it govern?
Consumer credit transactions with multiple payments of principal
What are exemptions?
1. Seasonal or intermittent income: If a consumer's livelihood is dependent upon seasonal or intermittent income, the parties may agree in a separate writing to reduce or expand payments or intervals based on the consumer's expected income. 2. Deferral of first periodic payment: A schedule of payments may provide for the deferral of the first periodic payment for up to 12 months, with no interest or costs accruing if the deferral exceeds 120 days. 3. Final payment not equal to other periodic payments: If the consumer credit transaction is for a term of at least 4 years and the contract allows the consumer to refinance the final payment on terms offered by the creditor, the final payment may be different from other periodic payments.
What are the Penalties?
No specific penalties mentioned in this document.
Jurisdiction
Maine