17:9A-59.32. Acceleration of maturity
416 words·~2 min read·
/nj/title-17/chapter-9a/17-9a-59-32·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
(a)The note evidencing a small business loan may provide that
(1)Upon default in the payment of any installment on its due date, the entire unpaid balance owing thereon shall, at the election of the bank, become immediately due and payable;
(2)When the maturity of the unpaid balance owing on a note is accelerated as provided by this section, the bank may charge interest at the legal rate, as defined in section 1 of this act from the date such acceleration takes place upon the unpaid principal balance thereof;
(3)On any installment of a precomputed loan in arrears for more than 10 days, the bank may make a late charge which shall not exceed 5% of such installment, or $5, whichever is the lesser; provided,
(A)(deleted by amendment)
(B)that only one such late charge shall be made on any one installment; and
(C)that no such late charge shall be made upon any installment scheduled, by the terms of such note, to fall due upon a date subsequent to the date upon which the maturity of the unpaid balance of the loan is accelerated as provided by this section;
(4)No party to such note shall be released or discharged from liability to the bank by reason of the bank's extending the time for the payment of an installment or installments owing or due upon such note, or by reason of the bank's waiver of any term or condition of such note, or of the instrument intended to secure payment thereof;
(5)All parties to such note shall waive presentation for payment, demand for payment, protest and notice of protest, nonpayment, dishonor, and the bank's election to accelerate the maturity of the unpaid balance owing thereon.
(b)(Deleted by amendment.)
(c)In addition to the provisions expressly authorized by subsection
(a)of this section, the note evidencing a small business loan, or the agreement pursuant to which such loan is made, may contain such provisions, not contrary to law or inconsistent with the provisions of this act, as the bank and the small business concern may agree upon, but no such note or agreement shall provide that payment of the note shall be accelerated because the bank, or other holder of the note, deems itself insecure. No bank shall take any power of attorney to confess judgment on any note evidencing a small business loan.
L.1964, c. 162, s. 8. Amended by L.1979, c. 319, s. 5, eff. Jan. 18, 1980.