A lender shall not pay a contractor under a home improvement contract from the proceeds of a high cost home mortgage loan other than (i) by an instrument payable to the borrower or jointly to the borrower and contractor, or (ii) 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 lender and the contractor before the disbursement of funds.
Mass. Gen. Laws ch. 183C, § 14
Lender's payment of contractor
Known as the Predatory Home Loan Practices Act
The act spans §§ 183C-1 to 183C-9 (19 sections).
Official source: Massachusetts Legislature. Reproduced from public-domain Massachusetts statutes; confirm against the official source for the current text. Not legal advice.