AN ACT REQUIRING ACCEPTANCE OF PERIODIC AND PARTIAL PAYMENTS ON CERTAIN MORTGAGE LOANS ISSUED BY CONNECTICUT BANKS AND CONNECTICUT CREDIT UNIONS.

Plain English Breakdown

The bill text uses the phrase 'credited, or treated as credited,' which leaves some uncertainty about how lenders might handle partial payments differently from full ones in practice.

Rules for Accepting Mortgage Payments from Connecticut Banks and Credit Unions

This law requires Connecticut banks and credit unions to accept and record full or partial mortgage payments on qualifying loans issued on or after October 1, 2026.

What This Bill Does

• Requires lenders to accept both periodic (full) and partial payments for qualifying residential mortgages.
• Mandates that accepted payments be credited, or treated as credited, on the business day they are received according to loan terms.
• Applies only if the payment is sent to the location where the borrower was instructed in writing to send it.
• Requires borrowers to provide enough information so lenders can identify and credit their specific mortgage account.

Who It Names or Affects

• Connecticut banks that issue residential mortgage loans on or after October 1, 2026
• Connecticut credit unions that issue residential mortgage loans on or after October 1, 2026
• Borrowers who take out new home loans for personal, family, or household use from these lenders

Terms To Know

Periodic payment

A full payment that covers the principal, interest, and any escrow amounts due for a billing cycle.

Partial payment

Any payment made in an amount less than the required periodic payment.

Residential mortgage loan

A loan issued on or after October 1, 2026, by a Connecticut bank or credit union for personal use and secured by a home.

Limits and Unknowns

• This law only applies to loans issued on or after October 1, 2026; it does not cover existing mortgages.
• The text states payments must be credited 'or treated as credited,' but does not explain the difference between these two actions.

Official Summary Text

To require certain payments on mortgage loans issued by Connecticut banks and Connecticut credit unions on and after October 1, 2026, to be accepted and credited or treated as credited.

Current Bill Text

LCO No. 1608 1 of 2

General Assembly Raised Bill No. 5212
February Session, 2026 LCO No. 1608

Referred to Committee on BANKING

Introduced by:
(BA)

AN ACT REQUIRING ACCEPTANCE OF PERIODIC AND PARTIAL
PAYMENTS ON CERTAIN MORTGAGE LOANS ISSUED BY
CONNECTICUT BANKS AND CONNECTICUT CREDIT UNIONS.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:

Section 1. (NEW) (Effective October 1, 2026) (a) As used in this section: 1
(1) "Periodic payment" means a payment made in an amount 2
sufficient to cover principal, interest and, if applicable, escrow for a 3
given billing cycle; 4
(2) "Partial payment" means a payment made in an amount less than 5
a periodic payment; and 6
(3) "Residential mortgage loan" means any loan that is (A) issued on 7
or after October 1, 2026, by a Connecticut bank or a Connecticut credit 8
union, as such terms are defined in section 36a-2 of the general statutes, 9
(B) primarily for personal, family or household use, and (C) secured by 10
a mortgage, deed of trust or other equivalent consensual security 11
interest on a dwelling or residential real estate upon which is 12
constructed or intended to be constructed a dwelling. 13

Raised Bill No. 5212

LCO No. 1608 2 of 2

(b) A periodic payment or a partial payment on a residential 14
mortgage loan shall be accepted and credited, or treated as credited, in 15
accordance with the terms of the residential mortgage loan, on the 16
business day on which the payment is received, provided (1) the 17
payment is made where the borrower has been instructed in writing to 18
make payments on such loan , and (2) the borrower has provided 19
sufficient information in order for the recipient of such payment to 20
identify and credit the relevant mortgage account. 21
This act shall take effect as follows and shall amend the following
sections:

Section 1 October 1, 2026 New section

Statement of Purpose:
To require certain payments on mortgage loans issued by Connecticut
banks and Connecticut credit unions on and after October 1, 2026, to be
accepted and credited or treated as credited.

[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except
that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not
underlined.]