38:23B-12. Terms of business loan

Each business loan made under this act shall:

a. Be evidenced by a note or other obligation approved by the commissioner.

b. Bear interest at a rate not exceeding four per centum (4%) per annum upon the unpaid balance.

c. Be payable as follows:

(1) In monthly or quarterly installments of interest, the first of which shall be payable not less than six months after the making of the loan and the last of which shall be payable not exceeding six years from the date of the obligation; and

(2) In monthly or quarterly installments of principal, the first of which shall be payable not less than twelve months after the making of the loan and the last of which shall be payable not exceeding six years from the date of the obligation; except, however, that any veteran at his option, may, on such form as the commissioner shall prescribe, waive the grace period, or any part thereof, herein provided him for the payment of the first installment of interest, or the grace period, or any part thereof, herein provided him for the payment of the first installment of principal, or both.

d. Be secured only by the personal liability of the maker, and not by any endorsers, comakers, collateral or other security; except that in accordance with such rules and regulations as prescribed by the commissioner, where the maker is married endorsement of the spouse may be required, and where the loan, or any part thereof, is made to finance the purchase or improvement of any property a lien on such property may be required.

Where the loan, or any part thereof, is made to finance the purchase or improvement of any property to be used by the veteran and any other person or persons in a business or profession to be conducted by them as partners, and a lien on such property is required pursuant to the rules and regulations of the commissioner, the instrument creating such lien may, pursuant to regulations prescribed by the commissioner, be required to be made and executed by such partners, individually and as copartners doing business under their trade name. Notwithstanding the provisions of any other law to the contrary every such lien instrument, properly recorded, shall be valid and effective against all creditors of such partnership.

L.1944, c. 126, p. 347, s. 12. Amended by L.1945, c. 185, p. 626, s. 5; L.1946, c. 121, p. 564, s. 9; L.1947, c. 190, p. 838, s. 1, eff. May 23, 1947.