1. A licensed industrial loan company may make permanent loans, construction loans, or combined construction and permanent loans, secured by liens on real property, as authorized by rules adopted by the superintendent under chapter 17A. These rules shall contain provisions as necessary to insure the safety and soundness of these loans, and to insure full and fair disclosure to borrowers of the effects of provisions in agreements for these loans, including provisions permitting change or adjustment of any terms of a loan, provisions permitting, requiring, or prohibiting repayment of a loan on a basis other than of equal periodic installments of interest plus principal over a fixed term, provisions imposing penalties for the borrower’s noncompliance with requirements of a loan agreement, or provisions allowing or requiring a borrower to choose from alternative courses of action at any time during the effectiveness of a loan agreement.

Terms Used In Iowa Code 536A.20

  • Account: means the same as defined in section 554. See Iowa Code 554E.1
  • Escrow: Money given to a third party to be held for payment until certain conditions are met.
  • Fiduciary: A trustee, executor, or administrator.
  • Fiscal year: The fiscal year is the accounting period for the government. For the federal government, this begins on October 1 and ends on September 30. The fiscal year is designated by the calendar year in which it ends; for example, fiscal year 2006 begins on October 1, 2005 and ends on September 30, 2006.
  • following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
  • Industrial loan company: shall mean a corporation operating under the provisions of this chapter and engaged in the business of loaning money to be repaid in one payment or in weekly, monthly or other periodic installments and the charging, receiving or requiring of interest, discount, fees, compensation or charges of whatever nature or kind for the use of such money and for the services to be rendered to the borrower in connection with the loan. See Iowa Code 536A.2
  • Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
  • Mortgagee: The person to whom property is mortgaged and who has loaned the money.
  • Mortgagor: The person who pledges property to a creditor as collateral for a loan and who receives the money.
  • person: means individual, corporation, limited liability company, government or governmental subdivision or agency, business trust, estate, trust, partnership or association, or any other legal entity. See Iowa Code 4.1
  • property: includes personal and real property. See Iowa Code 4.1
  • real property: include lands, tenements, hereditaments, and all rights thereto and interests therein, equitable as well as legal. See Iowa Code 4.1
  • Real property: Land, and all immovable fixtures erected on, growing on, or affixed to the land.
  • Superintendent: means the superintendent of banking within the banking division of the department of commerce. See Iowa Code 536A.2
  • year: means twelve consecutive months. See Iowa Code 4.1
 2. A licensed industrial loan company may require and establish escrow accounts in connection with subsection 3.
 3. a. A licensed industrial loan company may act as an escrow agent with respect to real property that is mortgaged to the licensed industrial loan company, and may receive funds and make disbursements from escrowed funds in that capacity. The licensed industrial loan company shall be deemed to be acting in a fiduciary capacity with respect to these funds. A licensed industrial loan company receiving funds in escrow pursuant to an escrow agreement executed on or after July 1, 1982 and before July 1, 1983 or on or after July 1, 1984 in connection with a loan defined in section 535.8, subsection 1, shall pay interest to the borrower on those funds, calculated on a daily basis, at the lowest rate the company pays to holders of thrift certificates issued by the company. A licensed industrial loan company which maintains such an escrow account, whether or not the mortgage has been assigned to a third person, shall deliver to the mortgagor a written summary of all transactions made with respect to the loan and escrow accounts during each calendar year. However, the mortgagor and mortgagee may, by mutual agreement, select a fiscal year reporting period other than the calendar year.

 b. The summary shall be delivered or mailed not later than thirty days following the year to which the disclosure relates. The summary shall contain all of the following information:

 (1) The name and address of the mortgagee.
 (2) The name and address of the mortgagor.
 (3) A summary of escrow account activity during the year as follows:

 (a) The balance of the escrow account at the beginning of the year.
 (b) The aggregate amount of deposits to the escrow account during the year.
 (c) The aggregate amount of withdrawals from the escrow account for each of the following categories:

 (i) Payments against loan principal.
 (ii) Payments against interest.
 (iii) Payments against real estate taxes.
 (iv) Payments for real property insurance premiums.
 (v) All other withdrawals.
 (d) The balance of the escrow account at the end of the year.
 (4) A summary of loan principal for the year as follows:

 (a) The amount of principal outstanding at the beginning of the year.
 (b) The aggregate amount of payments against principal during the year.
 (c) The amount of principal outstanding at the end of the year.
 4. Section 524.905, subsection 4, applies to the licensed industrial loan company in the same manner as if the licensed industrial loan company is a bank within the meaning of that provision.
  Previous section
Next section  
 Chapter 536A Contents