§ 34-25.2-7 - Assignee liability.
SECTION 34-25.2-7
§ 34-25.2-7 Assignee liability. – (a) Any person who purchases or is otherwise assigned a high-cost home loanshall be subject to all affirmative claims and any defenses with respect to theloan that the borrower could assert against the original creditor of the loan;provided, that this section shall not apply if the purchaser or assigneedemonstrates by a preponderance of the evidence that it:
(1) Has in place at the time of the purchase or assignment ofthe subject loans, policies that expressly prohibit its purchase or acceptanceof assignment of any high-cost home loans;
(2) Requires by contract that a seller or assignor of homeloans to the purchaser or assignee represents and warrants to the purchaser orassignee that either: (a) the seller or assignor will not sell or assign anyhigh-cost home loans to the purchaser or assignee; or (b) that such seller orassignor is a beneficiary of a representation and warranty from a previousseller or assignor to that effect; and
(3) Exercises reasonable due diligence at the time ofpurchase or assignment of high-cost home loans or within a reasonable period oftime after the purchase or assignment of such high-cost home loans, intended bythe purchaser or assignee to prevent the purchaser or assignee from purchasingor taking assignment of any high-cost home loans; provided, further, thatreasonable due diligence shall provide for sampling and shall not requireloan-by-loan review.
(b) In the event that a purchaser or assignee does notprevail under subsection (a), any recovery by a borrower, under this section,shall be limited to amounts required to reduce or extinguish the borrower'sliability under the high-cost home loan plus amounts required to recover costs,including reasonable attorneys' fees. Any such claim asserted by a borroweragainst a subsequent holder or assignee of the high-cost home loan may beasserted by a borrower acting only in an individual capacity and must beasserted as follows:
(1) Within five (5) years of the closing of a high-cost homeloan, a violation of this act in connection with the loan as an originalaction; and
(2) At any time during the term of a high-cost home loan,after an action to collect on the high-cost home loan or foreclose on thecollateral securing the high-cost home loan has been initiated or the debtarising from the high-cost home loan has been accelerated or the high-cost homeloan has become sixty (60) days in default, any defense, claim or counterclaim,or action to enjoin foreclosure or preserve or obtain possession of the homethat secures the loan.
(c) The provisions of this section shall be effectivenotwithstanding any other provision of law; provided, that nothing in thissection shall be construed to limit the substantive rights, remedies orprocedural rights available to a borrower against any creditor, assignee orholder under any other law.