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Barbara Reid Alexander (207)289-3731
Offices located at:
Harry W. Giddinge Central Building
DEPUTY SUPERINTENDENT Hallowell Annex
DEPARTMENT OF BUSINESS REGULATION
BUREAU OF CONSUMER CREDIT PROTECTION
STATE HOUSE STATION 35
AUGUSTA, MAINE 04333
ADVISORY RULING #66
MAY 6, 1982
May 6, 1982
You have asked for an Advisory Ruling to clarify two issues with respect to LD 1817, P.L. 1981, c. 618 which substantially amended the regulation of mobile home transactions in The Maine Consumer Credit Code.
First, you ask whether the new rate cap for mobile home credit sales and loans without land enacted at 9-A M.R.S.A. §§ 2-201(10) and 2-401(8) allows the imposition of the 1% origination fee in addition to the maximum rate established in FHA regulations.
Since the Code amendment allows "the maximum rate established by federal regulations" and the FHA regulations require that the 1% origination fee be included in the finance charge, 24 CFR § 201.540(a), the fee is allowed.
Second, you ask if a creditor has an option to follow either the Code maximum of 18% or the VA/FHA maximum, even when the VA/FHA rate falls below 18%. The answer is no. Sections 2-201(10) and 2-401(8) both establish a rate structure that is to be followed instead of the usual rule of §§ 2-201(2) or 2-401(2) and both use the phrase "Notwithstanding any other subsection..." Therefore, when the highest federal rate (FHA or VA) falls below 18%, the lower rate is the governing rate ceiling for mobile home transactions subject to the Code.
I hope this responds to your questions.
/s/ Barbara R. Alexander
Barbara R. Alexander