209 CMR 40.08 - Bona Fide Errors

It shall not constitute a violation of 209 CMR 40.05 through 40.07, if the lender shows by a preponderance of the evidence that either:

(1) Within 30 days of the loan closing, and prior to the institution of any action under M.G.L. c. 183C, the lender notifies the borrower of the compliance failure and makes appropriate restitution and whatever adjustments are necessary are made to the loan, at the choice of the borrower, to either:

(a) make the high cost home loan satisfy the requirements of M.G.L. c. 183C and 209 CMR 40.00; or

(b) change the terms of the loan in a manner beneficial to the borrower so that the loan will no longer be considered a high cost home loan; or

(2) The compliance failure was not intentional and resulted from a bona fide error, and within 60 days after the discovery of the compliance failure and before the institution of any action under M.G.L. c. 183C or 209 CMR 40.00 or the receipt of written notice of the compliance failure, the borrower is notified of the compliance failure, appropriate restitution is made and whatever adjustments are necessary are made to the loan, at the choice of the borrower, to either:

(a) make the high cost home loan satisfy the requirements of M.G.L. c. 183C and 209 CMR 40.00; or

(b) change the terms of the loan in a manner beneficial to the borrower so that the loan will no longer be considered a high cost home loan.

Notes

209 CMR 40.08

Amended by Mass Register Issue 1314, eff. 6/3/2016.