Loans other than those set forth in section 915(b)-(f) of the
Savings Association Code of 1967 (7 P. S. §
6020-155(b)-(f)) and any
others which by statute demand, require or permit a specific method of payment
shall be written on a direct reduction loan basis or may be written on any of
the following terms and conditions on all of which cases interest shall be
payable monthly:
(1) May be written
for a period not exceeding 10 years provided not less than 1.0% per year of the
principal of the loan is amortized within the term of the loan on a monthly
basis and the entire balance of the loan is due and payable at the maturity
date.
(2) May be written to require
interest payments only during the first 2 years of the mortgage loan and
thereafter on a direct reduction basis.
(3) May be written on a monthly payment basis
to require interest and reduced payments of the principal, not less, however,
than 1/2 of 1.0% of principal per year, for a period of 5 years and thereafter
on a direct reduction loan basis.
(4) A direct reduction loan may be written to
require payment of the principal at any stated time. The loan documents may
contain provisions for renegotiations or "rollovers" of the mortgage upon
expiration of the term for which the mortgage was written or extended, subject
to substantially the same terms, conditions, requirements, and consumer
protective provisions which are applicable in the case of Federal savings and
loan associations as set forth in
12 CFR
545.6-4 a, as published at 45 FR
24111 (April
9, 1980), in accordance with §
31.6 (relating to renegotiable
rate mortgage loans).
Notes
The provisions
of this § 31.5 adopted May 19, 1972,
effective 5/20/1972, 2 Pa.B.
897, amended June 27, 1980, effective 6/28/1980, 10 Pa.B.
2574.
The provisions of this § 31.5 issued under section 202 of
the Department of Banking and Securities Code (71 P. S. §
733-202); and sections 103, 701(a)(22), 901
and 915 of the act of December 14, 1967 (P. L. 746, No. 345) (7 P. S. §§
6020-3,
6020-101(a)(22), 6020-141 and
6020-155).
