Mortgages and Deeds of Trust - Accrual of Interest
2948.5. (a) A borrower shall not be required to pay interest on a principal obligation under a promissory note secured by a mortgage or deed of trust on real property improved with between one to four residential dwelling units for a period in excess of one day prior to recording of the mortgage or deed of trust if the loan proceeds are paid into escrow or, if there is no escrow, the date upon which the loan proceeds have been made available for withdrawal as a matter of right, as specified in subdivision (d) of Section 12413.1 of the Insurance Code.
(b) Interest may commence to accrue on the business day immediately preceding the day of recording, if both of the following occur:
(1) The borrower affirmatively requests, and the lender agrees, that the recording will occur on
Monday, or a day immediately following a bank holiday.
(2) The following information is disclosed to the borrower in writing:
(A) the amount of additional per diem interest charged to facilitate recording on Monday or the day following a holiday, as the case may be, and
(B) that it may be possible to avoid the additional per diem interest charge by recording the deed of trust on a day immediately following a business day. This disclosure shall be provided to the borrower and acknowledged by the borrower by signing a copy of the disclosure document prior to placing funds in escrow.
(c) This section does not apply to a loan that is subject to subdivision (c) of Section 10242 of the Business and Professions Code.