he Maryland Senate rejected today a House-passed bill that would allow lenders to increase charges to customers for processing second-mortgage loans. Instead, the Senate approved a weakened version that will allow "balloon" payments on second mortgages involving real estate, but not on loans for college tuition.
Gov. Harry Hughes and Attorney General Stephen B. Sachs had criticized the House version, saying it undercut consumer protections granted earlier this week when the legislature approved raising the interest-rate ceiling from 18 to 24 percent.
Lenders already are permitted to charge borrowers processing costs of 2 percent on a wide range of second-mortgage loans. The revised bill allows lenders to charge either $250 or 2 percent.
The Senate bill passed only after Sen. Laurence Levitan (D-Montgomery) was persuaded to withdraw an amendment that would have resurrected portions of the House bill. Levitan's amendment originally passed by a 17-to-16 vote early in the day but Levitan withdrew it after talking to Hughes and House leaders.
A lengthy debate on the bill centered on the ways borrowers could lose their property by not being able to make the balloon payment, which is a large single payment that comes due after a few years of a longer loan.
"Borrowing money you can't pay back will kill you the same way unhealthy water or unhealthy air or unhealthy food will kill you," said Sen. Frederick C. Malkus (D-Dorchester). "We have an obligation to keep that from happening to people."
The second-mortgage bill generated the only real controversy of the 88th day of the 90-day legislative session. An air of compromise, generated by the impending close of the session Monday night, produced swift passage of numerous proposals.
The House Judiciary Committee unanimously sent to the floor a bill that would allow a judge to confiscate the vehicle registration and license tags of a motorist convicted of drunken driving for the second time. The committee then killed a Senate-passed bill that would have permitted confiscation of the vehicles of those same repeat offenders.
"If we had passed the bill confiscating cars you might have gotten two or three people a year, if that many," said Del. Jerry H. Hyatt (D-Montgomery). "With this bill, people get called down for a hearing and if they're guilty they give up their tags right there. You might get 100 people a year that way."
The bill will come to the floor for final passage Monday.
Among bills that won final passage today, virtually without debate, were proposals that would:
Require contractors of migrant workers to inform both the state and the workers with whom they contract of the details and terms of the work they are doing.
Allow anyone who is represented before a state agency by a member of the legislature to retain confidentiality both in terms of his identity and the nature of his business. The bill passed the house today by a 99-to-9 vote.
Require banks to return canceled checks at no cost to any customer who requests them.
Restore to poor women welfare benefits or other public assistance--cut by the Reagan administration--during their first six months of pregnancy. The final language of the legislation must be resolved in a conference committee. One version, which calls for benefits for a "mother" and her "anticipated child," has been opposed by women's organizations on the grounds that it is antiabortion language.
Conferences between the two chambers began getting down to business today.
After a 10-minute meeting in the Senate lounge, a conference broke a deadlock on a bill raising the interest rate for delinquent taxpayers. The conferees agreed to a minimum of 12 percent and a maximum of 15 percent as the penalty, depending on the federal rate set in October of each year. The Senate had raised the rate from 9 to 12 percent while the House had voted for 24 percent. Senators argued that at 24 percent so few people would be delinquent on taxes that revenues from the penalty would be lessened greatly.
The measure took on added significance in the last 48 hours because it was one of the bills tied to legislation that would deinstitutionalize group homes for the mentally retarded.
Another conference committee tentatively agreed to the Senate version of a bill that would require counties to negotiate with municipalities that provide services within the county. The House version called for automatic compensation to the municipalities.
Despite efforts by House Speaker Benjamin L. Cardin to resurrect it, the so-called "decoupling" legislation appears unlikely to pass before the session ends. It would have allowed the state to avoid passing on to corporations a part of expanded depreciation allowances approved by Congress.
Two legislators were hospitalized this weekend and apparently will miss the end of the session.
Sen. Edward T. Conroy (D-Prince George's), chairman of the Senate Constitutional and Public Law Committee, was in Walter Reed Army hospital undergoing continued tests for back problems he has suffered throughout the session. Conroy, who was wounded during the Korean War, has missed much of the session because of illness.
Del. Raymond A. Dypski (D-Baltimore) was admitted to Johns Hopkins Hospital Friday suffering from an embolism in his leg resulting from phlebitis. Sen. Cornell N. Dypski (D-Baltimore) said his brother is also being treated for emphysema, and will be hospitalized for about two weeks.