AI-generated summary. We recommend consulting the bill text for important decisions.

Utah law already generally prohibits lenders from charging prepayment penalties — fees for paying off a loan early — but has long included an exception allowing certain home equity loans to carry such penalties if the lender offered the borrower a choice between a penalty-free loan and a lower-rate loan with a penalty. This bill removes that exception entirely, making the ban on prepayment penalties absolute for all closed-end consumer credit debts, and it also clarifies that upfront fees paid to third parties to set up a loan (such as closing costs) do not have to be refunded to the borrower when they pay off early, unless the lender itself receives a refund of those fees.