HAR §4-9-8
HAR §4-9-8. Security for loans
Cite as Haw. Code R. § 4-9-8
(a) For purposes of
class "A" and class "C" facility loans, no loan shall
exceed eighty five per cent of the value of the
security offered; for purposes of class "B" loans and
class "C" operating loans, the ratio of loan to the
value of the security offered shall be discretionary
with the department.
(b) All security instruments for the purposes of
direct loans shall be executed to and by the
department; for purposes of insured loans all security
instruments shall be executed to and by the private
lenders; for purposes of participating loans all
security instruments shall be executed to and by the
department and the private lender jointly.
(c) In case of the sale or transfer of mortgaged
land or other collateral, the department may permit
the item to be assumed under the following conditions:
(1)
Where the purchaser is a qualified
aquaculturalist; or
(2)
Where the purchaser may not be a qualified
aquaculturalist when the sale has been
advertised for a reasonable period of time
and no qualified aquaculturalist is willing
to purchase the farm or item; or
(3)
Where the purchaser continues aquaculture
operations and complies with conditions as
set forth in chapter 219, HRS, and rules as
prescribed herein.
(d) In case of the death of the borrower, a
legal heir or legal representative shall have the
option within six months of the death to assume the
mortgage of the deceased. The department or its
agents may, pending the exercise of the option and
pending possession being taken by the heirs or
representatives, take possession of all mortgaged
property and carry on the aquacultural operation
connected therewith, and the expense of the same shall
be added to the principal due on the mortgage to bear
interest at the applicable rate.
(e) If a loan is approved by the board, the
division shall cause the title to real property to be
examined and a mortgage drawn and recorded. The
applicant shall pay the actual costs involved.
9-6
Mortgages, title insurance, notes, security and
financing statements shall be used as security
instruments as applicable collateral. [Eff 9/28/81]
(Auth: HRS §219-5) (Imp: HRS §219-5, 7, 8)