15 AAC 145.070. Loan servicing

(a) The lender is responsible for servicing a loan guaranteed under the loan fund. If there is more than one lender, the lenders shall choose one of their number to service the loan.

(b) The lender shall complete and forward to the department a written quarterly status report within 20 days after the end of the reporting period covered by the report. The report must certify that the lender has applied standards of loan servicing that are employed by prudent lenders generally and that the lender has used the same degree of care and professionalism in servicing and payment collection as it does with other commercial loans.

(c) In the case of a loan to an employee stock ownership trust qualifying under 28 U.S.C. secs. 401 - 415 (Internal Revenue Code), the lender must certify initial qualification under the Internal Revenue Code and certify continuing qualification in each quarterly status report. An interruption in qualification constitutes a breach of the covenants of the loan guarantee and voids the loan guarantee.

History: Eff. 2/17/85, Register 93

Authority: AS 45.94.030

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