§ 19-9-2. Escrow accounts — Interest.
(a) Every mortgagee holding funds of a mortgagor in escrow for the payment of taxes and insurance premiums with respect to mortgaged property located in this state shall pay or credit interest on those funds at a rate equal to the rate paid to the mortgagee on its regular savings account, if offered, and otherwise at a rate not less than the prevailing market rate of interest for regular savings accounts offered by local financial institutions as determined by the director, said determination to be made within thirty (30) days of the effective date of this provision and thereafter annually on the first business day of the year. Said credit of interest shall accrue on the daily balance and be made annually on December 31. If the mortgage debt is paid prior to December 31 in any year, the interest to the date of payment shall be paid to the mortgagor. The provision of this section shall apply only with respect to mortgages on owner-occupied residential property consisting of not more than four (4) living units. The provisions of this section shall not be waived. No mortgagee holding the mortgagor’s funds in escrow for the payment of taxes shall also charge an annual “tax service fee” or other annual fee for ascertaining whether or not the real estate taxes have in fact been paid. Any mortgagee violating the provisions of this section shall be fined not more than one hundred dollars ($100) for each offense.
(b) Mortgages insured or guaranteed by the Farmer’s Home Loan Administration, Federal Housing Administration, or the Veterans’ Administration, or a private mortgage insurer licensed to do business in the state of Rhode Island or made pursuant to the provisions of chapter 55 of title 42 shall be exempt from the requirements of this section.
(c) The director, or the director’s designee, shall adopt any regulations that are necessary to carry out the provisions of this section.
History of Section.P.L. 1995, ch. 82, § 47; P.L. 2008, ch. 238, § 2; P.L. 2008, ch. 309, § 2.
Structure Rhode Island General Laws
Title 19 - Financial Institutions
Chapter 19-9 - Community Obligations and Banking Offenses
Section 19-9-1. - Definitions.
Section 19-9-2. - Escrow accounts — Interest.
Section 19-9-2.1. - Mortgage billing — Payment allocation.
Section 19-9-3. - Mortgages — Appraisal fees.
Section 19-9-3.1. - Mortgage loan appraisers — Relationship with lending institution.
Section 19-9-4. - Credit needs of local communities.
Section 19-9-5. - Mortgagor to be offered title insurance.
Section 19-9-6. - Lending institutions — Title attorney.
Section 19-9-7. - Attorney’s opinions.
Section 19-9-8. - Lending institutions — Negative amortization loans.
Section 19-9-9. - Mortgages issued — Payoffs.
Section 19-9-10. - Disbursement requirements — Purchase money loans — Dwellings.
Section 19-9-11. - Control of deposits by minors.
Section 19-9-12. - Trust deposits — Death of trustee.
Section 19-9-13. - Checks of trustees.
Section 19-9-14. - Deposits payable to survivor.
Section 19-9-14.1. - Uniform multiple-person accounts.
Section 19-9-15. - Pledge of passbook accounts.
Section 19-9-16. - Replacement of lost or destroyed passbook.
Section 19-9-17. - Charge-free savings accounts for minors.
Section 19-9-18. - Depositor identification.
Section 19-9-19. - Checks on consumer deposit accounts to show date account was opened.
Section 19-9-20. - Withdrawal from time deposit accounts.
Section 19-9-21. - Passbook savings accounts — Service charge prohibited.
Section 19-9-21.1. - Fee disclosure by banks, credit unions and other financial institutions.
Section 19-9-22. - Violations by officers and employees.
Section 19-9-24. - Fraudulent checks — Small amounts.
Section 19-9-25. - Fraudulent checks — Large amounts.
Section 19-9-26. - Prima facie evidence of intent to defraud — Prosecutions.
Section 19-9-27. - Check kiting.
Section 19-9-28. - False statement to obtain loan.
Section 19-9-29. - Bank fraud.
Section 19-9-30. - Injunctions against fraud.
Section 19-9-31. - False rumors as to condition of regulated institution.
Section 19-9-32. - Disclosure of arson conviction.
Section 19-9-33. - Severability.
Section 19-9-34. - Property insurance.
Section 19-9-35. - Consumer privacy in mortgage applications.