CT Gen Stat § 36a-746c (2020)
2020 Connecticut General Statutes|Title 36a - The Banking Law of Connecticut|Chapter 669 - Regulated Activities|Section 36a-746c - Prohibited provisions in loan agreement.

 A high cost home loan shall not provide for or include the following:(1) For a loan with a term of less than seven years, a payment schedule with regular periodic payments that when aggregated do not fully amortize the outstanding principal balance, except that this limitation does not apply to a loan with maturities of less than one year if the purpose of the loan is a bridge loan, as used in 12 CFR 1026.32, as amended from time to time, connected with the acquisition or construction of a dwelling intended to become the borrower's principal dwelling;(2) A payment schedule with regular periodic payments that cause the principal balance to increase;(3) A payment schedule that consolidates more than two periodic payments and pays them in advance from the proceeds, unless such payments are required to be escrowed by a governmental agency;(4) A refund calculated by a method less favorable than the actuarial method, as defined by Section 933(d) of the Housing and Community Development Act of 1992, 15 USC 1615(d), as amended from time to time, for rebates of interest arising from a loan acceleration due to default;(5) A prepayment penalty;(6) A waiver of participation in a class action or a provision requiring a borrower, whether acting individually or on behalf of others similarly situated, to assert any claim or defense in a nonjudicial forum that: (A) Utilizes principles which are inconsistent with the law as set forth in the general statutes or common law; (B) limits any claim or defense the borrower may have; or (C) is less convenient, more costly or more dilatory for the resolution of a dispute than a judicial forum established in this state where the borrower may otherwise properly bring a claim or defense; or(7) A call provision that permits the lender, in its sole discretion, to accelerate the indebtedness. This prohibition shall not apply when repayment of the loan is accelerated by bona fide default, pursuant to a due-on-sale clause provision, or pursuant to another provision of the loan agreement unrelated to the payment schedule including, but not limited to, bankruptcy or receivership.(P.A. 01-34, S. 5; P.A. 02-12, S. 2; P.A. 08-176, S. 64; P.A. 09-207, S. 8; P.A. 14-7, S. 6.)History: P.A. 02-12 amended Subdivs. (1) and (6) by adding “as from time to time amended” and amended Subdiv. (3) by adding “unless such payments are required to be escrowed by a governmental agency”, effective April 22, 2002; P.A. 08-176 amended Subdivs. (1) and (5) to make technical changes, amended Subdiv. (6) to delete exception re high cost home loan prepayment penalty, and amended Subdiv. (7) to delete “mandatory arbitration clause” and add provision re asserting of any claim or defense in nonjudicial forum, effective July 1, 2008; P.A. 09-207 deleted former Subdiv. (4) re increase in interest rate and redesignated existing Subdivs. (5) to (8) as Subdivs. (4) to (7), effective July 7, 2009; P.A. 14-7 amended Subdiv. (1) to replace “12 CFR 226.32” with “12 CFR 1026.32”, effective May 8, 2014.