[ Text of section effective until April 5, 2009. For text effective April 5, 2009, see below.]
Section 66. In making mortgage loans on real estate pursuant to section sixty-five, a credit union shall also be subject to the conditions hereinafter set forth.
1. The person obligated from time to time to make payments under a mortgage, whether as the original borrower or as a subsequent owner of the mortgaged property, shall be or shall become a member of the credit union.
2. There shall be an application for each such loan originated by the credit union. The form of application for a loan to be secured by a mortgage of real estate shall contain:
(a) the date,
(b) the name of the applicant,
(c) amount of loan desired,
(d) assessed value of the real estate in question,
(e) a statement of all balances due on any mortgages outstanding against such real estate,
(f) the income from such real estate,
(g) a description of such said real estate, and
(h) such other information as the board of directors may require.
Before any such loan is made, at least two members of the credit committee, or such greater number as the by-laws of the credit union may provide, shall, in writing on the application, approve the property offered as security and certify as to the value thereof according to their best judgment. Such application shall be filed and preserved with the records of the credit union but may accompany any sale or assignment of such mortgage loan. No application shall be required when a mortgage is acquired by purchase.
3. For every such loan there shall be a note or notes and a mortgage instrument which together shall contain the terms and provisions of the loan.
4. Any note or mortgage may contain conditions requiring the payment monthly, or at other periods of apportionments, of estimated taxes, betterment assessments and premiums for insurance of any kind applicable to the loan.
5. Subject to such requirements or limitations as the board of directors may determine, a credit union, with the assent of the persons obligated on any mortgage loan on real estate, may, from time to time revise, amend, modify, suspend, reduce, extend or otherwise change any of the terms, payments or obligations pertaining to such loan. Every such change shall be evidenced by an instrument setting forth the change, the payments to be made pursuant thereto and the provisions of any mortgage extension, which instrument shall be filed with the papers relating to the loan. Any sums loaned by such credit union, after the recording of its original mortgage, for the purposes referred to in section twenty-eight A of chapter one hundred and eighty-three, shall be governed by the provisions of said section.
The mortgage note evidencing the loan or the mortgage securing such mortgage note shall not be prejudiced by any change made pursuant to this paragraph, notwithstanding the fact that no provision for such change was originally made in the note or mortgage; provided, however, both the note and mortgage shall continue to be held by the credit union as good and sufficient security for the balance remaining unpaid after the date of such change.
Nothing contained in this paragraph shall be construed to prevent any mortgage loan held by such credit union from being rewritten, substituted or converted into any other type of mortgage which such credit union may lawfully hold.
Whenever any real estate loan is acquired by purchase, any terms thereof may be changed or supplemented by an extension or other agreement in order to cause such loan to conform with applicable provisions of law.
6. Upon the request in writing by the mortgagor, subject to the certification in writing by the credit committee of the credit union that the balance of a first mortgage on real estate is fifty percent or less of the value of the mortgaged property, the board of directors of the credit union may waive the requirement of the payment each month of a proportionate part of the estimated real estate taxes and betterment assessments.
7. A credit union shall accept principal payments in excess of payments required by any mortgage made or acquired and such additional payments may be accepted as anticipating an equal number of whole payments or effecting a reduction of all future payments required by the mortgage. In the event that such additional payments are made, the credit committee may reduce the monthly or other periodic payments as set forth in said mortgage; provided, however, that such reduced payments shall not extend the original term of the mortgage.
8. Every parcel of real estate mortgaged to secure a loan which, by its terms is payable in three years or less from the date of the note or is being amortized at a rate of three percent or less per annum, shall be revalued, as long as the loan is held, at intervals of not more than three years by or under the direction of at least two members of the credit committee who shall, in a written report, certify as to the value of the mortgaged property according to their best judgment. Upon the partial release of any real estate securing a mortgage, the remainder of the security shall have been revalued within three years. Such reports shall be presented to the directors at their next monthly meeting and a reference to such report and any action taken thereon shall be included in the minutes of such meeting.
9. In the event of a delinquency of ninety days in the scheduled payment of interest, principal or taxes, the parcel of real estate mortgaged to secure the loan shall be inspected forthwith by at least two members of the credit committee for the purpose of possible revaluation and thereafter a similar inspection shall be made at least quarterly while such loan shall be in default and a report thereof shall be made in writing and signed by at least one of such members and shall be filed with the board of directors.
Chapter 171: Section 66. Restrictions on real estate mortgage loans; credit union membership; location of mortgaged real estate; capitalization of assets
[ Text of section as amended by 2008, 454, Sec. 2 effective April 5, 2009. For text effective until April 5, 2009, see above.]
Section 66. In making mortgage loans on real estate pursuant to sections 65 to 65E, inclusive, a credit union shall be subject to the following conditions:
(1) A person obligated from time to time to make payments under a mortgage, whether as the original borrower or as a subsequent owner of the mortgaged property, shall be or shall become a member of the credit union.
(2) Each loan shall be on real estate situated within the commonwealth or within a radius of 100 miles of the main office of the credit union without regard to geographical location.
(3) A credit union having assets of not more than $100,000 may invest not more than 50 per cent of its assets in real estate mortgages. A credit union having assets of more than $100,000 but not $500,000 or more may invest not more than 70 per cent of its assets in real estate mortgages. A credit union having assets of $500,000 or more may invest not more than 80 per cent of its assets in real estate mortgages.