HAR §6-27-4. Operation of program; in general

(a) Periodically, the board of trustees of the system may allocate as part of its overall investment program, and under the limitations as are set forth in section 88-119(1), Hawaii Revised Statutes, a portion of its investment funds for investment in the member home loan program. Funds so allocated shall be further allocated to participating financial institutions. (b) Members of the system desiring a member home loan shall apply to a participating financial institution for a member home loan. A participating financial institution shall not accept a loan application from a member unless the participating financial institution has an office on the island which the member is residing. (c) The participating financial institution shall: (1) Apply to the system for certification of the applicant’s eligibility for a loan; (2) Ensure the purpose for which the loan is sought is an eligible purpose under this chapter; (3) Determine the applicants’ creditworthiness; (4) Make the loan in its own name as lender; (5) Forward the note, mortgage and the documentation as shall be required by the system to the system for its approval. (d) Providing the loan and the mortgage securing the loan are made in accordance with the requirements of this chapter, the lending institution shall endorse the note and assign the mortgage and note to the system which shall purchase the same from the lending institution. (e) The system may, in its discretion, service the loan or forward it to a financial institution having a servicing agreement with the system. [Eff 2/9/89] (Auth: HRS §§88-28, 88-119.5)