Introduced Version
House Bill 2412 History
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Key: Green = existing Code. Red = new code to be enacted
H. B. 2412
(By Delegates Moore and Reynolds)
[Introduced February 13, 2013; referred to the
Committee on Banking and Insurance then the Judiciary.]
A BILL to amend and reenact §46A-2-106 of the Code of West
Virginia, 1931, as amended, relating generally to the notice
of a default and consumer's right to cure a default;
lengthening the time period during which a default may be
cured; requiring the creditor to accurately state the amount
owed; requiring the creditor to state that the amount is also
legally due; requiring the creditor to
certify the date when
the notice to the borrower's right to cure the default was
sent; and establishing penalties.
Be it enacted by the Legislature of West Virginia:
That §46A-2-106 of the Code of West Virginia, 1931, as
amended, be amended and reenacted to read as follows:
ARTICLE 2. CONSUMER CREDIT PROTECTION.
§46A-2-106. Notice of consumer's right to cure default; cure; acceleration; penalties.
After a consumer has been in default on any installment
obligation or any other secured obligation for five days for
failure to make a scheduled payment or otherwise perform pursuant
to such a consumer credit sale, consumer lease or consumer loan
other than with respect to a covenant to provide insurance for or
otherwise to protect and preserve the property covered by a
security interest, the creditor may shall give him or her notice of
such the fact, which notice shall be made in the manner provided
for herein. Actual delivery of such the notice to a consumer or
delivery or mailing of the same to the last known address of the
consumer is sufficient for the purpose of this section. If given
by mail, notice is given when it is deposited in a mailbox properly
addressed and postage prepaid. Notice shall be in writing and shall
conspicuously state the name, address and telephone number of the
creditor to whom payment or other performance is owed, a brief
description of the transaction, the consumer's right to cure such
the default and the amount of payment and other required
performance and date by which it must be paid or accomplished in
order to cure the default. A copy of the notice required by this
section shall be: (I) Delivered or mailed to the last known address
of any cosigner of the obligation in the manner set forth in this
section unless the cosigner has waived in writing his or her right
to receive copies of the notice: Provided, That a waiver of notice contained in the consumer credit sales agreement or consumer loan
agreement does not constitute effective waiver of notice of the
cosigner's right to receive notice of the consumer's default for
purposes of this section; (ii) retained by the creditor; (iii)
certified in the manner prescribed by this section by an officer or
other authorized representative of such creditor; and (iv)
notarized by a person licensed as a notary under the laws of the
State of West Virginia or any other state or territory of the
United States. The certification required by this section shall
substantially conform to the following language:
" I, _______________(name of person certifying ), the
__________________________ (title of person certifying) of
_______________________(creditor's name), hereby certify that the
notice of the consumer's right to cure default amount reflected in
the notice on which this certification appears (or to which this
certification is attached ) is a true and accurate balance of all
unpaid sums legally due from the borrower on the date of this
notice. I hereby further certify that the foregoing notice of the
consumer's right to cure default was on this ____ day of
__________________, 1920_____, mailed to the person(s) whose
name(s) appear herein (therein) at the address(es) set forth herein
(therein).
_________________________________
(Signature)"
Failure to send notice to a cosigner as required by this
section does not, in and of itself, give rise to a cause of action
against the creditor. Failure to send notice to the consumer in the
manner provided by this section subjects the creditor to the
penalties set forth in section one hundred one
, article five of
this chapter.
Except as hereinafter provided in this section, after a
default on any installment or any other secured obligation other
than with respect to a covenant to provide insurance for or
otherwise protect and preserve the property covered by a security
interest or lease, a creditor may not accelerate the maturity of
the unpaid balance of any such installment obligation or any other
such secured obligation, commence any action or demand or take
possession of collateral on account of default until ten twenty
days after notice has been given to the consumer of his or her
right to cure such default or in accordance with the specific terms
of the obligation if such terms provide for a longer period. Until
such period expires, the consumer shall have the right to cure any
default by tendering the amount of all unpaid sums due at the time
of the tender, without acceleration, plus any unpaid delinquency or
deferral charges and by tendering any other performance necessary
to cure such the default. Any such cure shall restore a consumer
to all his or her rights under the agreement the same as if there
had been no default. A consumer who has been in default three or more times on the same obligation and who has been given notice of
such fact three or more times shall not have the right to cure a
default under this section even though previous defaults have been
cured and his or her creditor's right to proceed against him or
her and his or her collateral shall not be impaired or limited in
any way by this section. There shall be no acceleration of the
maturity of all or part of any amount owing in such a consumer
credit sale, consumer lease or consumer loan, except where
nonperformance specified in the agreement as constituting default
has occurred.
NOTE: The purpose of this bill is to ensure that West Virginia
borrowers are provided accurate notice of their right to cure a
default on any installment or other secured obligation and to
encourage more careful scrutiny on the part of creditors over the
calculation of the amount due from the borrower in order to cure
the default.
The bill lengthens the time from ten to twenty days
when a default may be cured. The bill requires the creditor to
accurately state the amount owed and that the amount is also
legally due. The bill requires the creditor to
certify the date
when the notice to the borrower's right to cure the default was
sent. The bill also establishes penalties.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.