The Vermont Statutes Online

Title 8 : Banking and Insurance

Chapter 222 : Powers

Subchapter 003 : LOANS

• § 32302. Real estate loans

  (a) Clear title. All loans secured by mortgages on real estate shall be supported by written evidence satisfactory to the credit union that title to the security is marketable, and the lien is valid and enforceable. A mortgage on lands subject to lease under which rents are reserved to the owner, with all of the owner’s rights and options under the lease collaterally assigned to the credit union as security or a mortgage upon lands impressed with a public use, sometimes known as lease, society, or glebe lands, but held under a durable lease, shall not be deemed to be subordinate to such lease or public use.

  (b) Appraised value. The appraisal of real estate securing a real-estate-related transaction entered into by a credit union shall comply with Part 722 of the National Credit Union Administration regulations, as amended from time to time.

  (c) Servicing of loans. A credit union may contract with another credit union, corporation, or association whose transactions are in whole or in part the handling and servicing of mortgage loans to handle and service loans in its behalf. Whenever such a contract is made, the credit union shall not lose or suffer any impairment of any right of deduction or offset it might have against anyone liable for the mortgage debt.

  (d) Home loan escrow accounts. Any credit union that requires a home loan escrow account to be established and maintained by a borrower shall follow the provisions of section 10404 of this title.

  (e) Loans insured or guaranteed by federal law. Any mortgage on real estate given to secure a loan insured or guaranteed by the federal housing commissioner, the administrator of veterans’ affairs, or the administrator of the Small Business Administration under the National Housing Act, the Servicemen’s Readjustment Act of 1944, or the Small Business Act, respectively, as amended, shall not be subject to the provisions of any law of this State prescribing the nature, amount, or form of security, or manner of repayment, or requiring security upon which loans or advances of credit may be made, or prescribing or limiting the period or principal amount of which loans may be made, or prescribing or limiting the interest that may be charged or other charges that may be made or taken upon any loan or advance of credit. (Added 2005, No. 16, § 1, eff. July 1, 2005; amended 2021, No. 105 (Adj. Sess.), § 336, eff. July 1, 2022.)