HF 3051

as introduced - 82nd Legislature (2001 - 2002) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to consumer protection; requiring notice of 
  1.3             default to be given to third party signers on certain 
  1.4             loans; proposing coding for new law in Minnesota 
  1.5             Statutes, chapter 325F. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  [325F.835] [NOTICE OF DEFAULT TO THIRD PARTY 
  1.8   SIGNERS.] 
  1.9      Subdivision 1.  [DEFINITIONS.] (a) "Consumer loan" has the 
  1.10  meaning given it in section 47.59, subdivision 1. 
  1.11     (b) "Borrower" means a debtor under a consumer loan. 
  1.12     (c) "Cosigner" means a person who agrees to be responsible 
  1.13  for the payments under a consumer loan but does not receive the 
  1.14  primary benefit of the transaction. 
  1.15     (d) "Lender" means a state or federally chartered bank, a 
  1.16  state or federally chartered bank and trust, a trust company 
  1.17  with banking powers, a state or federally chartered savings 
  1.18  bank, a state or federally chartered savings association, an 
  1.19  industrial loan and thrift company, a regulated lender, or an 
  1.20  operating subsidiary of any such institution. 
  1.21     Subd. 2.  [COSIGNER RIGHT TO NOTICE.] A lender who provides 
  1.22  notice to a borrower that a consumer loan is in default or that 
  1.23  any payment on a consumer loan is more than ten days late shall 
  1.24  provide a copy of the notice to any cosigner on the loan.  
  1.25  Notice to the cosigner must be provided within three business 
  2.1   days of the notice provided to the borrower.  A lender may 
  2.2   comply with the requirements of this section by sending a copy 
  2.3   of the notice to the cosigner's last known address.  
  2.4      Subd. 3.  [ENFORCEMENT.] The requirements of this section 
  2.5   may be enforced by the attorney general according to section 
  2.6   8.31.