26-2119. LOANS TO MEMBERS. (a) A credit union may loan to members for a provident or productive purpose and upon such security as the bylaws may provide, and the credit committee or loan officer shall approve. If permitted by law the borrowing members may be charged for the cost of filing fees on security instruments in connection with the transaction. Every application for a loan shall be made upon a form, which the credit committee prescribes and the board approves, which shall state the purpose for which the loan is desired and the security, if any, offered. Every loan shall be evidenced by a written instrument. No secured or unsecured loan shall be made to any member in excess of the limits set by written board policy. No loan shall be made unless it has been approved in writing by a loan officer or has received majority approval of the members of the credit committee present when the loan was considered, which members present shall constitute at least a majority of the credit committee.

(b) Loans may be made to, cosigned, endorsed, or guaranteed by members of the board, credit committee, and supervisory committee under the same general terms and conditions as to other members of the credit union. Any loan made to, cosigned, endorsed or guaranteed by members of the official family shall require the additional two-thirds (2/3) written agreement of all members of the board and credit committee where such loan or aggregate of such loans exceed the unsecured loan limit of the credit union plus the unencumbered share balance of the borrowing official.

(c) Loans may be granted to members of the credit union, secured by a first mortgage or deed of trust on improved real estate. Such loans shall not exceed eighty percent (80%) of the appraised value of the real estate made by an independent qualified appraiser and such loans shall provide additionally substantial equal monthly payments for the payment of insurance premiums and taxes assessed against the security, or in lieu thereof, the credit union may accept the assignment of a savings passbook. The total outstanding balance of loans secured by a mortgage or deed of trust on real estate shall not exceed fifteen percent (15%) of the members’ shares and deposits in the credit union, and shall be amortized in monthly payments for a maturity of not more than twenty (20) years. Notwithstanding the above, a credit union may make residential real estate loans which are made to finance the acquisition of a one (1) to four (4) family dwelling for the principal residence of a credit union member, which is secured by a first lien upon such dwelling, and which may have a maturity not exceeding thirty (30) years, if the credit union has previously obtained a commitment to sell the loan on the secondary market and does sell the loan no later than ninety (90) days from the date the funds are disbursed.

(d) A credit union may advance funds secured by a second mortgage or deed of trust on real estate. The total balance of the first and second mortgage or deed of trust combined shall not exceed eighty percent (80%) of the appraised value of the real property secured by the mortgage or deed of trust. Total second mortgage loans or deeds of trust on real estate shall not exceed ten percent (10%) of the members’ shares and deposits in the credit union. At the time a loan secured by a second mortgage or deed of trust is granted the credit union must have an appraisal performed by an independent qualified appraiser.

(e) A credit union may loan to members under the provisions of titles I and II of the national housing act and such insurance on these loans shall be deemed adequate security. The terms of such loans shall be as defined by the credit committee or under the provisions of titles I and II of the national housing act.

(f) In addition to generally accepted types of security, the assignment of shares in a manner consistent with the laws of Idaho, shall be deemed security within the meaning of this chapter and the adequacy of all securities shall be within the determination of the credit committee or loan officer subject to the provisions of this chapter and the bylaws. A member may pay the whole or any part of his loan on any day in which the credit union office is open for business.

(g) The credit committee, or when authorized, the loan officer, may approve in advance upon application by a member, an extension of credit, and loans may be granted to such members within the limits of such extension of credit. Where an extension of credit has been approved, applications for loans need no further consideration as long as the aggregate obligation does not exceed the limits of such extension of credit. The credit committee shall, at least once a year, review all extensions of credit and any extension of credit shall expire if the member becomes more than sixty (60) days delinquent in his obligations to the credit union.

(h) The director may, in his discretion, require any credit union to obtain a certified appraisal on any real estate secured loan.

History:

[26-2119, added 1977, ch. 213, sec. 2, p. 593; am. 1980, ch. 194, sec. 1, p. 429; am. 1982, ch. 211, sec. 1, p. 584; am. 1987, ch. 139, sec. 1, p. 272; am. 1991, ch. 236, sec. 1, p. 567.]