535.10 - HOME EQUITY LINE OF CREDIT.

        535.10  HOME EQUITY LINE OF CREDIT.         1.  As used in this chapter, the term "home equity line of      credit" means an arrangement pursuant to which all of the following      are applicable:         a.  The amounts borrowed and the interest and other charges      are debited to an account.         b.  The interest is computed on the account periodically.         c.  The borrower has the right to pay in full at any time      without penalty or to pay in the installments which are established      by the loan agreement.         d.  The lender agrees to permit the borrower to borrow money      from time to time with the maximum amount of each borrowing      established by the loan agreement.         e.  The account is secured by an interest in real estate.  The      priority of the secured interest in the real estate shall be      determined by section 654.12A.         2.  Except as provided in this section, a home equity line of      credit is subject to chapter 537.  However, sections 537.2307,      537.2402, and 537.2510 do not apply.         3. a.  A lender may collect in connection with establishing or      renewing a home equity line of credit the costs listed in section      535.8, subsection 2, paragraph "b", charges for insurance as      described in section 537.2501, subsection 2, and a loan processing      fee as agreed between the borrower and the lender, and annually may      collect an account maintenance fee of not more than fifteen dollars.      Fees collected under this subsection shall be disregarded for      purposes of determining the maximum charge permitted by subsection 4.         b.  The parties to a home equity line of credit which is not a      consumer credit transaction, as defined in section 537.1301, may      contract for a delinquency charge under terms no more favorable than      those permitted for open-end credit under section 537.2502.         4.  The interest rate on a home equity line of credit shall not      exceed one and three-quarters percent per month.         5.  Real estate which is the consumer's principal dwelling shall      not be subject to foreclosure when the balance secured is two      thousand dollars or less.  
         Section History: Recent Form
         84 Acts, ch 1272, § 1; 95 Acts, ch 35, §1; 99 Acts, ch 15, §1         Referred to in § 535.17