{"data":{"id":"us-nc/n.c.-gen.-stat.-54b-151","jurisdiction":"us-nc","citation":"N.C. Gen. Stat. § 54B-151","heading":"Permitted loans.","body":"(a)\tAn association may lend funds on the sole security of pledged withdrawable accounts, but no loan so made shall exceed the withdrawal value of the pledged account. However, no such loan shall be made when an association has applications for withdrawals or maturities which have not been paid.\n(b)\tAn association may lend funds on the security of real property:\n(1)\tOf such value, determined in accordance with the provisions of this Chapter and the rules and regulations concerning appraisals, sufficient to provide good and ample security for the loan; and\n(2)\tWhich has a fee simple title, totally free from encumbrances except as permitted within this Article; or\n(3)\tWhich has a leasehold title extending or renewable automatically or at the option of the holder or at the option of the association for a period of at least 10 years beyond the maturity of the loan; and\n(4)\tWhich has a clear title established by such evidence of title as is consistent with sound lending practices; and\n(5)\tWhere the security interest in such real property is evidenced by an appropriate written instrument creating or constituting a first and prior lien on real property, and the loan is evidenced by a note, bond or similar written instrument; or\n(6)\tWhere the security interest in such real property is evidenced by an appropriate written instrument creating or constituting a second or junior lien on real property which is subject only to a mortgage or deed of trust securing a commercial loan or a residential loan made by the association or another lender; and\n(7)\tWhere the security property may be subject also to taxes and special assessments not yet due and payable.\n(c)\tAn association may lend funds on the security of the whole of the beneficial interest in a trust in which the trust property consists of real property of the type upon which a loan would be permitted under G.S. 54B-151(b).\n(d)\tAn association may lend funds on the security of bonds issued as general obligations of or guaranteed by the United States, bonds issued as general obligations of this State, and bonds issued as general obligations of any county, city, town, village, school district, sanitation or park district, or other political subdivision or municipal corporation of this State. The amount of such loan made under the authority of this subsection shall not exceed ninety percent (90%) of the face value of the bonds which serve as security.\n(e)\tAn association may invest in construction loans, the proceeds of which, under the terms of a written contract between a lender and a borrower, are to be disbursed periodically as such construction work progresses. Such loans may include advances for the purchase price of the real property upon which such improvements are to be constructed. Any construction loan may be converted into a loan with permanent financing, and the term of the permanent financing shall be considered to begin at the end of the term allowed for construction.\n(f)\tAn association may lend funds without requiring security. No unsecured loan shall exceed the maximum amount authorized by regulation by the Commissioner of Banks.\n(g)\tAn association may invest in loans secured by a lien on unimproved real property.\n(h)\tAn association may invest in loans secured by the cash surrender value of any life insurance policy on the life of the borrower. However, the amount of such loan shall in no event exceed ninety percent (90%) of the cash surrender value of such life insurance policy.\n(i)\tAn association may invest in loans, obligations and advances of credit made for the payment of expenses of college or university education. Such loans may be secured, partly secured or unsecured, and the association may require a comaker or comakers, an insurance guarantee under a governmental student loan guarantee plan, or other protection against contingencies. The borrower shall certify to the association that the proceeds of the loan are to be used by a full-time student solely for the payment of expenses of college or university education or community college education.\n(j)\tAn association may lend funds on any collateral deemed sufficient by the board of directors to properly secure loans. Loans made solely upon security of collateral consisting of stock or equity securities which are not listed on a national stock exchange or regularly quoted and offered for trade on an over-the-counter market, shall be considered loans without security.\n(k)\tAn association may lend funds on the security of a mobile home subject to such rules and regulations governing such loans as may be promulgated by the Commissioner of Banks. (1981, c. 282, s. 3; 1983, c. 144, s. 19; 1987, c. 564, s. 14; 2001-193, s. 16.)","path":["Chapter 54B. Savings and Loan Associations.","Article 7. Loans."],"source_url":"https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_54B/GS_54B-151.html","current_through":"S.L. 2026-30","vintage":"","retrieved_at":"2026-08-27T18:05:42Z","sha256":"43bb82bda528d30a8172f3b90d663b3ca0429dc252d632f77c1bdf34c40dcc5b","source_id":"us-nc","stale":false,"prev":"us-nc/n.c.-gen.-stat.-54b-150","next":"us-nc/n.c.-gen.-stat.-54b-152"},"notice":"GroundRules: Original legal text. Not legal advice."}