[History: Tribal Act #03-21.1190, enacted by Tribal Council in Special Session on January 29, 2003.]
This Chapter shall be known as the "Homeowner Protection from Predatory Lending Ordinance."
[History: Tribal Act #03-21.1190, enacted by Tribal Council in Special Session on January 29, 2003.]
(a) 
The Tribal Council finds and declares that unscrupulous mortgage lenders often engage in "predatory lending," practices in which lenders make unsuitable loans designed to exploit vulnerable unsophisticated borrowers. These "predatory loans" are a subset of sub-prime lending and loans and have one or more of the following features:
(1) 
Charges more in interest and fees than is required to cover the added risk of lending to borrowers with credit imperfections;
(2) 
Contains abusive terms and conditions that trap borrowers and lead to increased indebtedness;
(3) 
Does not take into account borrowers' abilities to repay the loans; or
(4) 
Violates fair lending laws by targeting Tribal members.
(b) 
The Homeownership Protection from Predatory Lending Ordinance establishes a behavior standard by which creditors, lenders, appraisers, home inspectors, builders, manufactured housing dealers, contractors, and real estate agents must conduct business when tribal members, lands, and/or dollars are involved in housing and mortgage lending transactions. The intent of this Ordinance is to eliminate predatory behavior/practices by requiring all "interested parties" to disclose business relationships and arrangements that could influence the decision making process in a proposed transaction. The Ordinance prohibits "interested parties" from receiving undisclosed referral fees, "excessive transaction related commission/fees" and/or other consideration that violate the spirit of this Tribal Code. The Realtor Agency Disclosure Statement and HUD 1 Settlement Statement must identify all fees and clearly define transactional costs including business relationships with "related parties." The Tribe must receive a complete copy of the HUD 1 Settlement Statement for the buyer and seller three days prior to the scheduled closing.
[History: Tribal Act #03-21.1190, enacted by Tribal Council in Special Session on January 29, 2003.]
(a) 
"Affiliate" means any company that controls, is controlled by, or is under common control with another company, pursuant to the federal "Bank Holding Company Act of 1956" (12 U.S.C. § 1841 et seq.).
(b) 
"Annual Percentage Rate" means the annual percentage rate for a loan calculated pursuant to the federal "Truth in Lending Act" (15 U.S.C. § 1601 et seq.), and the regulations promulgated by the Federal Reserve Board.
(c) 
"Bona Fide Loan Discount Points" means loan discount points knowingly paid by a borrower for the purpose of reducing, and which result in a reduction of, the interest rate or time-price differential applicable to the loan, provided the amount of the interest rate reduction purchased by the discount points is reasonably consistent with established industry practices for market transactions.
(d) 
"Borrower" means any natural person or persons/Tribal member(s) obligated to repay a loan, including, without limitation, a co-borrower, cosigner, or guarantor.
(e) 
"Credit Insurance" means any credit life, credit disability, credit unemployment, accident, health or loss of income insurance or any other line or subline of insurance which may become accepted as credit insurance by the insurance and lending industries or any debt cancellation or suspension agreement or contract (whether or not the debt cancellation or suspension agreement or contract coverage is insurance under applicable law) or any similar product.
(f) 
"Creditor" means a person who extends consumer credit that is subject to a finance charge or that is payable by written agreement in more than four installments and to whom the obligation is payable.
(g) 
"High-Cost Home Loan" means any loan or extension of credit, including an open-end line of credit but excluding a reverse mortgage transaction, as defined in 12 C.F.R. § 226.33, as from time to time amended:
(1) 
The principal amount of the loan does not exceed the lesser of the conforming loan size limit for a single-family dwelling as established from time to time by the Federal National Mortgage Association;
(2) 
The borrower is a natural person/GTB Tribal member;
(3) 
The debt is incurred by the borrower primarily for personal, family or household purposes;
(4) 
The loan is secured by a security leasehold interest or mortgage on real estate upon which there is erected or to be erected a one- to four-family dwelling; and
(5) 
The terms of the loan equal or exceed one or more of the "thresholds," as that term is defined in this Act.
(h) 
"Home Loan" means a loan or agreement to extend credit made to a natural person/Tribal member, which loan is secured by a leasehold interest, a deed to secure debt, security deed, mortgage, security instrument, deed of trust, or other document representing a security interest or lien upon any interest in one- to four-family residential property or a manufactured home located in (the Grand Traverse Band of Ottawa and Chippewa service area, which is represented by the following counties in Michigan: Antrim, Benzie, Charlevoix, Grand Traverse, Leelanau and Manistee), regardless of where made, including the renewal or refinancing of any such loan. Without limiting the generality of the foregoing, the term specifically includes a home equity line of credit, a commercial or small business loan secured by a residential property or manufactured home, per capita loan, or other similar agreement.
(i) 
"Interested Party" means any party that generally, but not necessarily, benefits from the final outcome of the transaction.
(j) 
"Junior Mortgage" means a home loan secured by a deed of trust or mortgage on real property if the deed of trust or mortgage is junior in priority to another deed of trust or mortgage on the real property.
(k) 
"Lender" means any person who makes a home loan or acts as a mortgage broker with respect to a home loan.
(l) 
"Loan Consummation" means the time that a consumer becomes contractually obligated on a credit transaction.
(m) 
"Mortgage Broker" means any person who functions as intermediary for a fee between the borrower and the creditor in the making of a home loan.
(n) 
"Originate" means to arrange, negotiate, or make a consumer loan.
(o) 
"Prepayment penalty" means any charge or penalty for paying all or part of the principal before the date on which the principal is due and includes computing a refund or unearned interest by a method that is less favorable to the borrower than the actuarial method, as defined by Section 933(d) of the Housing and Community Development Act of 1992, 15 U.S.C. § 1615(d), as from time to time amended.
(p) 
"Points and fees" means:
(1) 
All items required to be disclosed under 12 C.F.R. §§ 226.4(a) and 226.4(b), as amended, except interest or the time-price differential;
(2) 
All charges, except for escrow amounts for future payments of taxes and insurance, for items listed under 12 C.F.R. § 226.4(c)(7), as amended, if the creditor receives direct or indirect compensation in connection with the charge of the charge is paid to an affiliate of the creditor, or third party or parties;
(3) 
All compensation paid directly or indirectly to a mortgage broker, including a broker that originates a home loan in its own name through an advance of moneys and subsequently assigns the home loan to the person advancing the moneys;
(4) 
The maximum prepayment fees or penalties that may be charged or collected under the terms of the loan documents;
(5) 
All prepayment fees or penalties that are charged to the borrower if the loan refinances a previous loan made by the same creditor or an affiliate of the creditor;
(6) 
For open-ended loans, the points and fees are calculated by adding the total fees charged at closing plus the maximum additional fees that can be charged pursuant to the loan documents during the term of the loan.
(7) 
The term "points and fees" does not include taxes, filing fees, recording charges, and other charges and fees paid or to be paid to public officials for determining the existence of or for perfecting, releasing, or satisfying a security interest.
(q) 
"Rate" means the interest rate charged on the home loan, based on an annual simple interest yield.
(r) 
"Threshold" means any one of the following:
(1) 
The annual percentage rate of the loan equals or exceeds:
(A) 
By more than four percentage points the yield on Treasury securities having comparable periods of maturity on the 15th day of the month immediately preceding the month in which the application for the extension of credit is received by the creditor, if the home loan is a first mortgage; or
(B) 
By more than five percentage points the yield on Treasury securities having comparable periods of maturity on the 15th day of the month immediately preceding the month in which the application for the extension of credit is received by the creditor, if the home loan is a junior mortgage.
(2) 
The total points and fees equals or exceeds 3% of the total loan amount or $400, whichever amount is greater; provided, the following discount points are excluded from the calculation of the total points and fees payable by the borrower:
(A) 
Up to and including two bona fide loan discount points payable by the borrower in connection with the loan transaction, but only if the interest rate without the discount points does not exceed by more than one percentage point the average interest rate posted on Freddie Mac's Weekly Mortgage Rate Survey.
(B) 
Up to and including one bona fide loan discount point payable by the borrower in connection with the loan transaction, but only if the interest rate without the discount points is more than one percentage point higher but less than two percentage points greater than the average interest rate posted on Freddie Mac's Weekly Mortgage Rate Survey.
If the terms of the home loan provide for an initial or introductory period during which the annual percentage rate is lower than that which will apply after the end of such initial or introductory period, then the annual percentage rate to be considered for purposes of the definition is the rate which applies after the initial or introductory period. If the terms of the home loan provide for an annual percentage rate that varies in accordance with an index plus a margin or varies in any other manner, then the annual percentage rate to be considered for purposes of this definition is the maximum rate that will be charged during the term of the loan. For loans that vary according to an index, the annual percentage rate is computed as the index rate at loan closing plus the largest margin specified in the loan agreements.
(s) 
"Total Loan Amount" means the principal of the loan minus those points and fees as defined in Subsection (o) of this section that are included in the principal amount of the loan. For open-ended loans, the total loan amount is calculated using the total line of credit allowed under the home loan.
[History: Tribal Act #03-21.1190, enacted by Tribal Council in Special Session on January 29, 2003.]
All home loans made within the jurisdiction of the Grand Traverse Band are subject to the following limitations:
(a) 
No Financing of Credit Insurance. No creditor making a home loan may finance, directly or indirectly, the premiums for any credit life, credit disability, credit property, or credit unemployment insurance, or any other life or health insurance premiums, or any payments for any debt cancellation or suspension agreement or contracts. Insurance premiums and debt cancellation or suspension agreement payments that are not included in the home loan principal and that are calculated and paid on a monthly basis may not be considered to have been financed by the creditor for purposes of this subsection.
(b) 
No Flipping. No creditor shall knowingly or intentionally engage in the unfair act or practice of flipping a consumer home loan. For the purposes of this section, "flipping" is the making of a home loan to a borrower that refinances an existing home loan when the new loan does not have a tangible benefit to the borrower considering all of the circumstances, including the terms of both the new and refinanced loans, the cost of the new loan, and the borrower's circumstances. Home loan refinancings are presumed to be flippings if the primary tangible benefit to the borrower is an interest rate lower than the interest rate on debts satisfied or refinanced in connection with the home loan, and it will take more than four years for the borrower to recoup the costs of the points and fees and other closing costs through savings resulting from the lower interest rate. The provisions of this subsection apply regardless of whether the interest rate, points, fees and charges paid or payable by the borrower in connection with the refinancing exceed those thresholds as defined in 13 GTBC § 903(r) of this Act.
(c) 
No Default Recommendations. No creditor may recommend or encourage default on an existing loan or other debt prior to and in connection with the closing or planned closing of a home loan that refinances all or any portion of that existing loan or debt.
(d) 
No Excessive Late Fees. A creditor may not charge a late payment fee except according to the following rules:
(1) 
The late payment fee may not be in excess of 4% of the amount of the payment past due.
(2) 
The late payment fee may be assessed only for a payment past due for 15 days or more.
(3) 
The late payment fee may not be charged more than one time with respect to a single late payment. If a late payment charge is deducted from a payment made on the loan, and the deduction causes a subsequent default on a subsequent payment, no late payment charge may be imposed for the default. If a late payment charge has been imposed one time with respect to a particular late payment, a late payment fee may not be imposed with respect to any future payment that would have been timely and sufficient, but for the previous default.
(4) 
A late payment fee may not be charged unless the creditor notifies the borrower within 45 days following the date the payment was due that a late payment charge has been imposed for a particular late payment. No late payment charge may be collected from any borrower if the borrower informs the creditor that nonpayment of an installment is in dispute or presents proof of payment within 45 days after receipt of the creditor's notice of the late charge.
(5) 
A creditor must treat each payment as posted on the same date as it was received by the creditor, services, or creditor's agent, or at the address provided to the borrower by the creditor, services, or the creditor's agent for making payments.
(e) 
No Refinancing of Special Mortgages. No creditor may make a home loan if the new loan refinances an existing home loan that is a special mortgage originated, subsidized, or guaranteed by or through a state, tribal, or local government, or nonprofit organization, that either bears nonstandard payment terms beneficial to the borrower, such as payments that vary with income, are limited to a percentage of income, or where no payments are required under specified conditions, or with a below-market interest rate that is at least one percentage point less than the average interest rate posted on Freddie Mac's Weekly Mortgage Survey, and where, as a result of the refinancing, the borrower will lose one or more of the benefits of the mortgage.
(f) 
No Call Provisions. A home loan may not contain a provision that permits the creditor, in its sole discretion, to accelerate the indebtedness. This subsection does not prohibit acceleration of the loan in good faith due to the borrower's failure to abide by the material terms of the loan.
(g) 
No Fee for Balance or Payoff. A creditor may not charge a fee for informing or transmitting to a person the balance due to pay off a home loan or to provide a release upon prepayment. A creditor must provide payoff balance not later than seven business days after the request is received by the creditor.
(h) 
No Fee for Product Where Product Not Provided. A creditor may not charge a fee for a product or service where the product or service is not actually provided, or misrepresent the amount charged by or paid to a third party for a product or service.
(i) 
No Above-Market Charges for Services. No third party may charge or receive any unreasonable compensation for loan-related goods, products, and services. For the purpose of this section, "unreasonable compensation" is a price for loan-related goods, services, and products that is 50% higher than the average price in (a metropolitan area or the non-metropolitan areas of a state or Leelanau/Grand Traverse Counties). The average price can be determined by obtaining quotes for services from three or more third parties. Loan-related goods, products and services include fees for tax payment services, fees for flood certification, fees for pest infestation determinations, mortgage brokers' fees, appraisal fees, inspection fees, environmental assessment fees, fees for credit report services, assessments, costs of upkeep, surveys, attorneys' fees, notary fees, escrow charges and insurance premiums, including, for example, fire, title, life, accident and health, disability, unemployment, flood and mortgage insurance.
(j) 
No False Statements or Representations. A creditor, appraiser, broker, or real estate agent must not make or cause to be made, directly or indirectly, any false, deceptive, or misleading statement or representation in connection with a home loan, including, without limitation, a false, deceptive, or misleading statement or representation regarding the borrower's ability to qualify for any mortgage product, or regarding the value of the dwelling. A statement or representation is deceptive or misleading if it has the capacity to deceive or mislead a borrower or potential borrower. The court may consider the following factors in deciding whether a statement or representation is deceptive or misleading:
(1) 
The overall impression that the statement or representation reasonably creates.
(2) 
The particular type of audience to which the statement is directed.
(3) 
Whether it may be reasonable comprehended by the segment of the public to which the statement is directed.
(k) 
No Influencing Appraiser. A creditor, broker, or real estate agent may not directly or indirectly compensate, coerce, or intimidate an appraiser for the purpose of influencing the independent judgment of the appraiser with respect to the value of real estate covered by a home loan or is being offered as security according to an application for a home loan.
(l) 
No Blanks in Loan Documents. A home loan document in which blanks are left to be filled in after the contract is signed by the borrower is not enforceable under the law.
(m) 
Required Language Accommodation. If the discussions between the creditor and the borrower on a home loan are conducted primarily in a language other than English, the creditor must, before closing, provide an additional copy of all information required to be disclosed to the borrower under the federal Truth in Lending Act and the Real Estate Settlement Procedures Act, translated into the language in which the discussions were conducted, or make available an objective third party interpreter who can explain the loan transaction and translate the loan documents and disclosures into the language in which the discussions were conducted.
(n) 
Required Disclosure of Yield Spread Premiums. In the making of a home loan, the amount of yield spread premium and other compensation paid to mortgage brokers must be disclosed to the borrower no later than three days prior to closing the home loan. The borrower must also be informed of the comparison of the dollar amount of the yield spread premium paid to the broker and the dollar amount of the loan costs assumed by the broker. The borrower must also be informed how many basis points the interest rate increased due to the yield spread premium and how much the increase in the interest rate adds to the monthly loan payment and the total loan payment over the term of the loan.
[History: Tribal Act #03-21.1190, enacted by Tribal Council in Special Session on January 29, 2003.]
All high-cost home loans are subject to the following limitations:
(a) 
No Financing of Points and Fees. No creditor making a high-cost home loan may directly or indirectly finance:
(1) 
Any prepayment fees or penalties payable by the borrower in a refinancing transaction if the creditor or an affiliate of the creditor is the noteholder of the note being refinanced;
(2) 
Points and fees defined in 13 GTBC § 903 in excess of 3% of the total loan amount; or
(3) 
Any other charges payable to third parties.
(b) 
No Benefit From Refinancing Existing High-Cost Home Loan With New High-Cost Home Loan. A creditor may not charge a borrower points, fees, or other charges in connection with a high-cost home loan if the proceeds of the high-cost home loan are used to refinance an existing high-cost home loan held by the same creditor or an affiliate of the creditor.
(c) 
Limit on Prepayment Penalties.
(1) 
A high-cost loan shall not include a prepayment fee or penalty after the first 24 months after the late of consummation of the loan.
(2) 
A covered loan may include a prepayment fee or penalty up to the first 24 months after the date of consummation of the loan if:
(A) 
The person who originates the covered loan has also offered the consumer a choice of another product without a prepayment fee or penalty.
(B) 
The person who originates the covered loan has disclosed in writing to the consumer at least three business days prior to loan consummation the terms of the prepayment fee or penalty to the consumer for accepting a covered loan with the prepayment penalty and the rates, points, and fees that would be available to the consumer for accepting a covered loan without a prepayment penalty.
(C) 
The person who originates the covered loan has limited the amount of the prepayment fee or penalty to an amount not to exceed the payment of six months' advance interest, at the contract rate of interest then in effect, on the amount prepaid in any twelve-month period in excess of 20% of the original principal amount.
(3) 
A covered loan will not impose the prepayment fee or penalty if the covered loan is accelerated as a result of default.
(4) 
The person who originates the covered loan will not finance a prepayment penalty through a new loan that is originated by the same person.
(d) 
No Balloon Payment. No high-cost home loan may contain a scheduled payment that is more than twice as large as the average of earlier scheduled payments. For a payment schedule that is adjusted to account for the seasonal or irregular income of the consumer, the total installments in any year may not exceed the amount of one year's worth of payments on the loan. This prohibition does not apply to a bridge loan. For purposes of this paragraph, "bridge loan" means a loan with a maturity of less than 18 months that only requires payments of interest until the time when the entire unpaid balance is due and payable.
(e) 
No Steering. No creditor making a high-cost home loan may steer a borrower into a loan with higher costs than the lowest-cost category of loans for which the borrower could qualify with that creditor or any of its affiliates. No mortgage broker arranging a high-cost home loan may steer a borrower into a loan with higher costs than the lowest-cost array of loans available to that borrower from the creditors with whom the mortgage broker regularly does business.
(f) 
No Negative Amortization. No high-cost home loan may contain a payment schedule with regular periodic payments that cause the principal balance to increase at any time over the course of the loan because the regular periodic payments do not cover the full amount of interest due.
(g) 
No Advance Payments. No high-cost home loan may include terms under which more than two periodic payments required under the loan are consolidated and paid in advance from the loan proceeds provided to the borrower.
(h) 
No Increased Interest Rate Upon Default. Except with regard to interest rate changes in a variable-rate loan in which the increase is otherwise consistent with the provisions of the loan documents and in which the event of default or the acceleration of the indebtedness does not trigger a change in the interest rate, no high-cost home loan may contain a provision that increases the interest rate after default.
(i) 
No Modification or Deferral Fees. A creditor may not charge a borrower any fees or other charges to modify, renew, extend, or amend a high-cost home loan or to defer any payment due under the terms of a high-cost home loan.
(j) 
No Mandatory Arbitration Clause. No high-cost loan may be subject to a mandatory arbitration clause that limits in any way the right of the borrower to seek relief through the judicial process. Non-binding arbitration and mediation would be acceptable forms of attempted dispute or conflict resolution.
(k) 
No Lending Without Home Ownership Counseling. A creditor may not make a high-cost home loan without first receiving certification from a counselor approved by the Grand Traverse Band and/or United States Department of Housing and Urban Development or the creditor's regulatory agency of jurisdiction that the borrower has received counseling on the advisability of the loan transaction and the appropriate loan for the borrower.
(l) 
No Lending Without Due Regard to Repayment Ability.
(1) 
A creditor may not make a high-cost home loan unless the creditor reasonably believes at the time the loan is consummated, the person reasonably believes the consumer, or consumers, when considered collectively in the case of multiple consumers, will be able to make the scheduled payments to repay the obligation based upon a consideration of their current and expected income, current obligations, employment status, and other financial resources, other than the consumer's equity in the dwelling that secures repayment of the loan. In the case of multiple consumers, a creditor may not include or add a borrower to the high-cost loan, unless the individual or added borrower separately confirms in writing to the creditor that the borrower expects and commits to substantially contribute to payments.
(2) 
The consumer is presumed to be able to make the scheduled payments to repay the obligation if, at the time the loan is consummated, the consumer's total monthly debts, including amounts owed under the loan, do not exceed 50% of the consumer's monthly gross income, as verified by the credit application, the consumer's financial statement, a credit report, financial information provided to the person originating the loan by or on behalf of the consumer, or any other reasonable means. In the case of a covered loan with an annual percentage rate that varies, this evaluation shall be based upon the procedures for computing the annual percentage rate in 13 GTBC § 903 (q) above.
(m) 
No Attempted Evasion. A creditor who originates a high-cost loan may not avoid, or attempt to avoid, the application of this division by doing the following:
(1) 
Dividing any loan transaction into separate parts for the purpose of evading the provisions of this Act.
(2) 
Any other such acts or practices with the intent of evading the provisions of this Act.
(n) 
Restrictions on Home-Improvement Contracts. A creditor may not pay a contractor under a home-improvement contract from the proceeds of a high-cost home loan unless:
(1) 
The creditor is presented with a completion contract dated and signed by all parties to the home-improvement contract showing that the home improvements have been completed; and
(2) 
The instrument is payable to the borrower or jointly to the borrower and the contractor or, at the election of the borrower, through a third-party escrow agent in accordance with terms established in a written agreement signed by the borrower, the creditor, and the contractor prior to the disbursement.
(o) 
Required Notice. A creditor or broker may not sell, transfer or otherwise assign a high-cost home loan without furnishing the following statement to the purchaser or assignee:
"NOTICE: THIS IS A HOME LOAN SUBJECT TO SPECIAL RULES AND CONDITIONS AS REQUIRED BY TRIBAL LAW. PURCHASERS OR ASSIGNEES OF THIS LOAN ARE LIABLE FOR ALL CLAIMS AND DEFENSES WITH RESPECT TO THE LOAN THAT THE BORROWER COULD ASSERT AGAINST THE CREDITOR OR BROKER OF THE LOAN."
(p) 
Required Reporting of Payments. Any lender who makes a high-cost home loan must report both the favorable and unfavorable payment history of the borrower to a nationally recognized consumer credit reporting agency at least annually during such period as the lender holds or services the loan.
[History: Tribal Act #03-21.1190, enacted by Tribal Council in Special Session on January 29, 2003.]
(a) 
Right to Reinstate. If a creditor asserts that grounds for acceleration exist and requires the payment in full of all sums secured by the security instrument, the borrower or anyone authorized to act on the borrower's behalf has the right at any time, up to the time title is transferred by means of foreclosure, judicial proceeding and sale, or otherwise, to cure the default and reinstate the high-cost home loan by tendering the amount or performance as specified in this section. Cure of default as provided in this section reinstates the borrower to the same position as if the default had not occurred and nullifies as of the date of the cure any acceleration of any obligation under the security instrument or note arising from the default.
(b) 
Grounds for Reinstatement. Before any action filed to foreclose upon the property or other action is taken to seize or transfer ownership of the property, a notice of the right to cure the default must be delivered to the borrower informing the borrower of the following:
(1) 
The nature of default claimed on the high-cost home loan, and of the borrower's right to cure the default by paying the sum of money required to cure the default; except that a creditor or services may not refuse to accept any reasonable partial payment made or tendered in response to such notice. If the amount necessary to cure the default will change during the twenty-day period after the effective date of the notice due to the application of a daily interest rate or the addition of late fees, as allowed by this Act, the notice must give sufficient information to enable the borrower to calculate the amount at any point during the twenty-day period;
(2) 
The date by which the borrower must cure the default to avoid acceleration and initiation of foreclosure, or other action to seize the property, which date may not be less than 20 days after the date the notice is effective, and the name, address, and telephone number of a person to whom the payment or tender shall be made;
(3) 
That if the borrower does not cure the default by the date specified, the creditor may take steps to terminate the borrower's ownership in the property by requiring payment in full of the high-cost home loan and commencing a foreclosure proceeding or other action to seize the property; and
(4) 
The name and address of the creditor and the telephone number of a representative of the creditor whom the borrower may contact if the borrower disagrees with the creditor's assertion that a default has occurred or the correctness of the creditor's calculation of the amount required to cure the default.
(c) 
Fees. To cure a default under this section, a borrower is not required to pay any charge, fee, or penalty attributable to the exercise of the right to cure a default as provided for in the section, other than the fees specifically allowed by this section. The borrower may be liable for attorney fees that are reasonable and actually incurred by the creditor, based on a reasonable hourly rate and a reasonable number of hours; except that the borrower may not be liable for any attorney fees relating to the borrower's default that are incurred by the creditor prior to or during the twenty-day period set forth in this section.
[History: Tribal Act #03-21.1190, enacted by Tribal Council in Special Session on January 29, 2003.]
(a) 
Civil Action. The Tribal Council authorizes any borrower to initiate a civil action in Grand Traverse Band Tribal Court to enforce this Ordinance. The Tribal Council is also authorized to initiate a civil action of declaration, injunctive, or other equitable relief on its own behalf, on behalf of the public interest, or on behalf of a borrower to enforce this Ordinance.
(b) 
Jurisdiction. The Grand Traverse Band Tribal Court has exclusive jurisdiction over all civil actions initiated to enforce this Ordinance. As a matter of law, persons engaging in lending activities covered in this Ordinance consent to the jurisdiction of the Grand Traverse Band Tribal Court.
(c) 
Enforcement and Remedies.
(1) 
Any violation of this Act constitutes an unfair or deceptive trade practice.
(2) 
Any person found by a preponderance of evidence to have violated this Act is liable to the borrower for the following:
(A) 
Actual damages sustained by the borrower as a result of the violation. The borrower is required to demonstrate reliance in order to receive actual damages;
(B) 
Statutory damages equal to the finance charges agreed to in the home loan agreement plus 20% of the amount financed for all violations;
(C) 
Punitive damages if the violation was malicious or reckless;
(D) 
Reasonable costs and attorney fees. In addition, the court may, as the court deems appropriate, grant injunctive, declaratory, and other equitable relief in an action to enforce compliance.
(3) 
The intentional violation of this Act, including the absence of acting in good faith, renders the home loan agreement void. A creditor intentionally violating any provision in this Act has no rights to collect, receive, or retain any principal, interest, or other charges whatsoever with respect to the loan, and the borrower may recover any payments made under the agreement. Loan terms that violate the protections of this Act are unenforceable, and the courts may issue orders to reform any terms to bring the loan into compliance.
(4) 
The brokering of a home loan that violates the provisions of this Act constitutes a violation of such provisions.
(5) 
The rights of rescission granted under 15 U.S.C. § 1601 et seq. for violations of this Act and all other remedies provided in this Act are available to a borrower by way of recoupment against a party foreclosing on the home loan or collecting on the loan, at any time during the term of the loan.
(6) 
The borrower may also assert a violation of this Act as a defense, bar, or counterclaim to any default action, collection action, or judicial or nonjudicial foreclosure action in connection with a home loan.
(7) 
The remedies provided under this Act are cumulative. The protections and remedies provided under this Act are in addition to other protections and remedies that may be otherwise available under law. Nothing in this Act is intended to limit the rights of any injured person to recover damages or pursue any other legal or equitable action under any other applicable law or legal theory.
(8) 
Any entity that purchases or is otherwise assigned a home loan is liable for all claims and defenses with respect to the loan that the borrower could assert against the creditor or broker of the loan.
(9) 
A creditor that makes a home loan and that, when acting in good faith, fails to comply with the provisions of this Act will not be deemed to have violated this Act if the creditor establishes that either:
(A) 
Within 30 days after the loan closing, and prior to receiving any notice from the borrower or any governmental agency of such noncompliance, the creditor made appropriate restitution to the borrower and made appropriate adjustments to the loan; or
(B) 
Within 60 days after the loan closing, prior to receiving any notice from the borrower of such noncompliance, and the noncompliance was not intentional and resulted from a bona fide error notwithstanding the maintenance of procedures reasonably adapted to avoid such errors, the creditor made appropriate restitution to the borrower and made appropriate adjustments to the loan. Examples of a bona fide error include clerical, calculation, computer malfunction and programming, and printing errors. An error of legal judgment with respect to a person's obligations under this section is not a bona fide error.
(10) 
High-cost home loans are governed by this Act notwithstanding any other provision of law to the contrary.
[History: Tribal Act #03-21.1190, enacted by Tribal Council in Special Session on January 29, 2003.]
The provisions of this Act are severable, and if any phrase, clause, sentence, paragraph, or provision of this Act, or the application thereof to any person or circumstance, is for any reason adjudged by a court of competent jurisdiction to be invalid, such judgment shall not affect, impair, or invalidate the remainder of this Act nor the application of such phrase, clause, sentence, paragraph, or provision to other persons or circumstances, but is confined in its operation to the phrase, clause, sentence, paragraph, or provision thereof and to the persons or circumstances directly involved in the controversy in which such judgment may have been rendered. If any provision of this Act is declared to be inapplicable to any specific category, type of loan or points and fees, the provisions of this Act shall nonetheless continue to apply with respect to all other loans and points and fees.
[History: Tribal Act #03-21.1190, enacted by Tribal Council in Special Session on January 29, 2003.]
(a) 
Effective Date. This Act shall take effect at 12:01 a.m. on the day following the expiration of the ninety-day period after enactment.
(b) 
Applicability. This Act applies to home loans and high-cost home loans offered or originated or consummated on or after the applicable effective date of this Act.
[History: Tribal Act #03-21.1190, enacted by Tribal Council in Special Session on January 29, 2003.]
Nothing in this Ordinance is, or may be construed as, a waiver of the sovereign immunity of the Grand Traverse Band, its officers, employees, or agents.