Sec. 1. 9-B MRSA §429, sub-§1, as repealed and replaced by PL 1983, c. 679, §2, is amended to read:

1. Definition. As used in this section and in section 429-A, unless the context indicates otherwise, the following terms have the following meanings.

A. "Escrow account" means any account established by agreement between a mortgagor and mortgagee under which the mortgagor pays to the mortgagee sums to be used to pay taxes or insurance premiums.

B. "Mortgagee" means any financial institution authorized to do business in this State, as defined in section 131, subsection 17-A, any credit union authorized to do business in this State, as defined in section 131, subsection 12-A, any supervised lender, as that term is defined in Title 9-A, section 1-301, subsection 39, and their assignees.

Sec. 2. 9-B MRSA §429-A is enacted to read:

§429-A.__Property tax escrow calculation

A mortgagee that holds funds of a mortgagor in an escrow account for the purpose of paying property taxes on owner- occupied residential real estate shall calculate the amount collected for that purpose taking into consideration the exemption for homesteads provided by Title 36, chapter 105, subchapter IV-B.

SUMMARY

This bill requires a mortgagee holding an escrow account for payment of real estate taxes on owner-occupied residential property to calculate the amount collected for that purpose taking into account the homestead property tax exemption.