Administrative Rules of Montana › Department 2 - ADMINISTRATION › Chapter 2.59 - BANKING AND FINANCIAL INSTITUTIONS › Subchapter 2.59.1 - Banks › Rule 2.59.116 - DEFINITIONS

Current through Register Vol. 13, July 5, 2024
(1) "Actuarial method" means the method of
				allocating payments made on a debt between the amount financed and the finance
				charge. Under this method, a payment is applied first to the accumulated
				finance charge and any remainder is subtracted from, or any deficiency is added
				to, the unpaid balance of the amount financed.
(2) "Contract" means a debt cancellation
				contract or a debt suspension agreement.
(3) "Customer" means an individual who
				obtains from a bank an extension of credit that is primarily for personal,
				family, or household purposes. For purposes of this subchapter, the term means
				the same thing as "borrower."
(4)
				"Debt cancellation contract" means a loan term or contractual arrangement
				modifying loan terms under which a bank agrees, for a fee, to suspend all or
				part of a customer's obligation to repay an extension of credit from that bank
				upon the occurrence of a specified event. The agreement must specify the
				extension of credit to which it pertains. The extension of credit to which it
				pertains may be a direct loan made by the bank or an indirect loan in the form
				of a retail installment sales contract purchased by or assigned to the bank. In
				the case of an indirect loan in the form of a retail installment sales
				contract, the debt cancellation contract may be offered by the bank through a
				nonexclusive, unaffiliated agent contingent upon the bank purchasing or taking
				assignment of the indirect loan. The agreement may be separate from or a part
				of other loan documents. A debt cancellation contract may be offered and
				purchased either contemporaneously with the other terms of the loan agreement
				or subsequently.
(5) "Debt
				suspension agreement" means a loan term or contractual arrangement modifying
				loan terms under which a bank agrees, for a fee, to suspend all or part of a
				customer's obligation to repay an extension of credit from that bank upon the
				occurrence of a specified event. The agreement must specify the extension of
				credit to which it pertains. The extension of credit may be a direct loan made
				by the bank or an indirect loan in the form of a retail installment sales
				contract purchased by or assigned to the bank. In the case of an indirect loan
				in the form of a retail installment sales contract, the debt suspension
				agreement may be offered by the bank through a nonexclusive, unaffiliated agent
				contingent upon the bank purchasing or taking assignment of the indirect loan.
				The agreement may be separate from or a part of other loan documents. The term
				"debt suspension agreement" does not include loan payment deferral arrangements
				in which the triggering event is the borrower's unilateral election to defer
				repayment or the bank's unilateral decision to allow a deferral of
				repayment.
(6) "Guaranteed asset
				protection (GAP) waiver or agreement" means a term of an extension of credit or
				contractual arrangement modifying terms of an extension of credit for the
				purchase of titled personal property under which a bank agrees to cancel the
				customer's obligation to repay the portion of the extension of credit that
				exceeds the amount paid by the primary insurer of the titled personal property
				upon the insurer's declaration that the titled personal property is a total
				loss or determination that the titled personal property is stolen and not
				recoverable.
(7) "Loan" or
				"extension of credit" means a direct or indirect advance of funds to a customer
				made on the basis of any obligation of that customer to repay the funds or that
				is repayable from specific property pledged by or on the customer's behalf. The
				term also includes any liability of a bank to advance funds to or on behalf of
				a customer pursuant to a contractual commitment.
(8) "Residential mortgage loan" means a loan
				for personal, family, or household purposes secured by a one- to four-family
				residential property.
32-1-218, MCA; IMP,
					 32-1-429,
					 MCA;