AS Title 26, Chapter 15: Veterans' Loans

Chapter 15. Veterans' Loans. Sec. 26.15.010. Powers and duties of Department of Commerce, Community, and Economic Development with respect to veterans' loans. (a) The Department of Commerce, Community, and Economic Development shall administer the laws and regulations relating to the veterans' loan program, adopt new regulations, and recommend legislation. (b) The department shall obtain the guarantee of the United States under the Servicemen's Re-Adjustment Act on loans as prescribed by regulations of the department. Under regulations of the department, the department may guarantee or insure loans or portions of loans not to exceed 90 percent as may be obtainable by veterans having the qualifications of beneficiaries under this chapter from any person, firm, corporation, bank, savings and loan association, or an agency or instrumentality of the United States, and may grant participating portions of the loans. (c) Under regulations of the department, the department may grant loans to two or more qualified veterans to engage in the same business, as a partner or joint venturer with one or more other persons. However, if one or more veterans engage as a partner in a business or joint venture with a nonveteran, the department shall require the nonveteran or nonveterans to contribute equally to the capital assets of the business or joint venture. (d) Under regulations of the department, the department may enter into contracts with insurance companies for mortgage insurance coverage on veteran loans. Sec. 26.15.020. Validation of certain documents. The deeds, mortgages, assignments, or other documents made, executed, and delivered in conformity with the provisions of this chapter and as otherwise required by law, in which the designation “Veterans' Affairs Commission” appears, whether as grantor, grantee, mortgagee, assignor, assignee, or otherwise, are validated and confirmed, and all obligations incurred under the provisions of any such deed, mortgage, assignment, or other instrument by the Territory of Alaska, the Alaska World War II Veterans' Board, or the commissioner of veterans' affairs, in an official capacity, are hereby declared to be good, valid, and subsisting obligations, and the covenants, conditions, and provisions, if any, prescribed to be kept, paid, performed, or observed, imposed upon any party described in any such instrument shall be discharged as herein set forth, the fact that the officer executing and delivering any such instrument added to the officer's signature the description “Veterans' Affairs Commission,” notwithstanding. Sec. 26.15.030. Powers and duties of Department of Commerce, Community, and Economic Development in general. (a) The Department of Commerce, Community, and Economic Development shall formulate general policies and adopt regulations, including regulations to establish reasonable fees for services provided. (b) The department may hold hearings and subpoena witnesses and documents, and administer oaths in connection with hearings. (c) The department shall (1) cooperate with the federal government in matters of mutual concern pertaining to loans to Alaskan veterans; (2) make reports that the federal government may desire; (3) cooperate with the state and its political subdivisions and agencies; (4) adopt regulations necessary for the conduct of its business and for carrying out the provisions of this chapter, and make necessary regulations to maintain such standards; (5) require bonds and undertakings from persons employed by it as shall in its judgment be necessary, and pay the premiums on them; (6) establish regional and local offices and advisory groups that are necessary or considered expedient to carry out or assist in carrying out its duties and authorities; (7) charge and collect the fees established under this section. Sec. 26.15.040. Veterans' loans. (a) The commissioner of commerce, community, and economic development may, under regulations and policies, make the following loans: (1) personal loans may be made for educational, domestic, remote area family housing and other personal purposes, not exceeding $10,000; the loans shall be secured by acceptable collateral when available but if not available the commissioner may make loans on the basis of good character; the rate of interest may not exceed nine and one-half percent a year on the unpaid balance; (2) [Repealed, § 77 ch 106 SLA 1980.] (3) business loans not exceeding $125,000 may be made to acquire, finance or refinance or equip businesses, including mining and fishing but not including farming, if the loan applicant has had three or more years of general business experience; the loans shall be secured by acceptable collateral and may not exceed 75 percent of the appraised value of the collateral offered as security; the rate of interest may not exceed nine and one-half percent a year on the unpaid balance; (4) multiple dwelling loans not exceeding $110,000 may be made to purchase, remodel, repair, build, furnish, refinance or equip multiple dwellings; the loans shall be secured by acceptable collateral and may not exceed 75 percent of the appraised value of the collateral offered as security; the rate of interest may not exceed nine and one-half percent a year on the unpaid balance. (b) The commissioner of commerce, community, and economic development may enter into agreements with private banks, other lending institutions and individuals for the purpose of guaranteeing loans made to qualified applicants. The guarantees may not exceed 90 percent of the amount loaned and the loans shall be secured in the same manner provided for direct loans under this section. A loan made under this subsection and guaranteed by the commissioner of commerce, community, and economic development and the state shall bear an interest rate not exceeding nine and one-half percent a year on the unpaid balance. (c) Loans authorized by former (a)(2) of this section or (a)(3) and (4) of this section may not be made unless the commissioner of commerce, community, and economic development is satisfied that money at a comparable rate of interest is not available to the applicant from private lending institutions on a guaranteed basis as set out in (b) of this section. An applicant is eligible for more than one type of loan, but the total may not exceed $125,000 at any one time. (d) Money loaned shall be disbursed to the borrower from the treasury, vouchered in the manner prescribed for state disbursing officers, and charged against the Alaska World War II veterans' revolving fund. Each voucher shall be approved by the commissioner of commerce, community, and economic development or any bonded deputy authorized to act as a certifying officer. Upon repayment of loans by installments, or otherwise, in accordance with the prescribed terms, or upon liquidation by foreclosure or other process, or upon receipt of interest, the money so received shall be turned over to the commissioner of revenue for deposit in the Alaska World War II veterans' revolving fund. (e) If a loan made under (a)(3) of this section is assigned by the borrower or if the real property that secures a loan made under former (a)(2) or under (a)(4) of this section is transferred by the borrower, the commissioner of commerce, community, and economic development shall allow the assignee or transferee to assume the outstanding indebtedness on the loan unless the commissioner determines in writing that the credit of the assignee or transferee is not satisfactory to assure repayment of the loan. The assignee or transferee may assume the outstanding indebtedness on the loan at the existing interest rate on the loan. Sec. 26.15.050. Interest rates. The provisions of AS 26.15.040 applying to interest rates apply only to loans made after April 1, 1967. The interest rates on loans made before April 1, 1967 shall be prescribed at the time the loan was made. Sec. 26.15.060. Sale or transfer of preferred commercial paper. [Repealed, § 33 ch 141 SLA 1988.] Sec. 26.15.070. Sale or transfer of mortgages and notes. (a) The commissioner of commerce, community, and economic development may sell or transfer at par value or at a premium or discount to any bank or other private purchaser for cash or other consideration the mortgages and notes held by the Department of Commerce, Community, and Economic Development as security for loans made under this chapter. (b) [Repealed, § 14 ch 122 SLA 1980.] Sec. 26.15.080. Power of commissioner to assign and sell mortgages. [Repealed, § 34 ch 21 SLA 1985.] Sec. 26.15.085. Disposal of property acquired by default or foreclosure. The Department of Commerce, Community, and Economic Development shall dispose of property acquired through default or foreclosure of a loan made under this chapter. Disposal shall be made in a manner that serves the best interests of the state, and may include the amortization of payments over a period of years. Sec. 26.15.090. Alaska World War II veterans' revolving fund. (a) There is created the Alaska World War II veterans' revolving fund to carry out this chapter. Except as provided in (b) and (c) of this section, the fund may not be used for any other purpose. (b) Money in the fund may be used by the legislature to make appropriations for costs of administering this chapter. (c) On June 30 of each fiscal year the unexpended and unobligated cash balance of the fund that is attributable to loans owned by the fund lapses into the general fund. Sec. 26.15.095. Special account established. (a) There is established as a special account within the Alaska World War II veterans' revolving fund the foreclosure expense account. This account is established as a reserve from fund equity. (b) The commissioner of commerce, community, and economic development may expend money credited to the foreclosure expense account when necessary to protect the state's security interest in collateral on loans made under AS 26.15.040 or to defray expenses incurred during foreclosure proceedings after a default by an obligor. Secs. 26.15.100 — 26.15.120. Repayment of loan fund; limitation on securing bonus and loan; bonus payments. [Repealed, § 25 ch 94 SLA 1980.] Sec. 26.15.130. Eligibility for loans. (a) Qualifications for loans under this chapter are as follows: (1) persons who served in the armed forces of the United States for 90 days or more, or whose service was for less than 90 days because of injury or disability incurred in the line of duty, between April 6, 1917, and November 11, 1918, between September 16, 1940, and November 7, 1975, between August 2, 1990, and January 2, 1992, or beginning September 11, 2001, and ending on the day prescribed by Presidential proclamation or by law as the last date of Operation Iraqi Freedom, or who served in a combat zone during any period of armed conflict, or during any time period listed in 5 U.S.C. 2108(1), who were separated from the armed forces with a discharge other than dishonorable, and (A) who, at the time of induction into the service, were residents of the territory or state, who had been residents for not less than one year immediately before their induction, and who returned to the territory or state after discharge as residents with the intention of remaining in the territory or state; or (B) who, not being bona fide residents of the territory or state before their entry into the service, have been residents of the territory or state for one or more years; (2) persons who were dependent on a member of the armed forces or a veteran of World War II at the time of the member's or veteran's death, if (A) the member or veteran was a resident of the territory or state for one year before induction into the service; and (B) the member or veteran served in the armed forces for at least 90 days between September 16, 1940, and July 25, 1947, but benefits for loans do not accrue to dependents of an enlistee or re-enlistee for time served after November 1, 1945, regardless of whether the enlistment or reenlistment was before or after November 1, 1945; and (C) the member or veteran died before the official date of the termination of that war; and (D) the member's or veteran's discharge was not dishonorable; (3) persons who have served in the Alaska Army National Guard or the Alaska Air National Guard or the Alaska Naval Militia for not less than six years and who have not received a discharge other than honorable. (b) Dependents must be unmarried and the deceased member of the armed forces or deceased veteran must have been their chief means of support and they must be either a widow, widower, minor son, minor daughter, or mother, father, sister or brother incapable of self-support. Dependents must be residents of the territory or state at the time of making application and intend to reside in the territory or state permanently. The rights of minor children may be exercised only if they have no surviving parent and have an appointed guardian who may apply on their behalf to secure a loan for their care, support, education or other purposes mentioned in AS 26.15.040 or to receive the bonus for those purposes. (c) A person who has a past due child support obligation established by court order or by the child support services agency under AS 25.27.160 — 25.27.220 at the time of application is not eligible for a loan under this chapter. Sec. 26.15.140. Eligibility for benefits under this chapter. A person is not eligible for benefits under this chapter if the person is eligible under the laws of any other state or territory for a veterans loan or bonus. Sec. 26.15.150. Eligibility for bonuses. [Repealed, § 25 ch 94 SLA 1980.] Sec. 26.15.160. Extension of chapter to members of the Alaska Territorial Guard and to veterans of the armed forces of the United States. The provisions of this chapter, except those provisions relating to the payment of bonuses, are extended to persons who served in the Alaska Territorial Guard and to veterans of the armed forces of the United States, who served other than dishonorably on active duty between June 25, 1950, and January 31, 1955, between August 4, 1964, and November 7, 1975, between August 2, 1990, and January 2, 1992, beginning September 11, 2001, and ending on the day prescribed by Presidential proclamation or by law as the last date of Operation Iraqi Freedom, or during any time period listed in 5 U.S.C. 2108(1) and to dependents of those persons, subject to the following provisions and eligibility qualifications: (1) persons are eligible (A) who served in the Alaska Territorial Guard, who were discharged other than dishonorably from the armed forces of the United States, or who are released to a reserve component; and (B) who, at the time of entry into the service, were bona fide residents of the territory or State of Alaska and had been residents of the territory or state for not less than one year before their entry into the service; and who have returned to the territory or state within a reasonable length of time after the end of their service in the Alaska Territorial Guard or their discharge or separation as residents with the intention of remaining in the territory or state; or who, not being bona fide residents of the territory before their entry into the service, have lived in the territory or state for at least five years following their release from active military service; and (C) who served in the armed forces of the United States for 90 days or more, or whose service was for a lesser period because of injury or disability incurred in line of duty, between June 25, 1950, and January 31, 1955, between August 4, 1964, and July 1, 1977, between August 2, 1990, and January 2, 1992, beginning September 11, 2001, and ending on the day prescribed by Presidential proclamation or by law as the last date of Operation Iraqi Freedom, or during any time period listed in 5 U.S.C. 2108(1), or who served in the Alaska Territorial Guard for 90 days or more or whose service in the Alaska Territorial Guard was for a lesser period because of injury or disability incurred in the line of duty; (2) persons are eligible who were dependent upon a member of the Alaska Territorial Guard or armed forces or upon a veteran, including persons who served in the Alaska Territorial Guard, eligible for the benefits of this chapter at the time of the member's or veteran's death if the member or veteran was a resident of the territory for one year before entry into service; dependents must be unmarried and the deceased veteran or member of the armed forces must have been their chief means of support and they must be either a widow, widower, minor child, or a mother, father, sister, or brother incapable of self-support; dependents must be residents of the state at the time of application and shall intend to remain residents in the state permanently; the rights of minor children under this chapter may be exercised only if they have no surviving parent and have an appointed guardian who may apply on their behalf for the benefits of this chapter for their care, support, or education; (3) a person who is eligible for veteran's benefits under the laws of any other state or territory is not eligible for the benefits of this section unless the person has lived in the state or territory for at least five years following the end of the person's service in the Alaska Territorial Guard or release from active military service; a World War II veteran who received a bonus under former AS 26.15.120 and former AS 26.15.150 need not repay the bonus in order to qualify under the loan provisions of this section; (4) for persons otherwise eligible for the benefits under this section, who did not return to the state or territory not later than one year after the end of the persons' service in the Alaska Territorial Guard or separation from the service unless prevented from doing so for medical, educational, or other valid purposes approved by the Department of Commerce, Community, and Economic Development not later than one year after the end of the persons' service in the Alaska Territorial Guard or separation from the service, an additional requirement of four years' residence in the state or territory before their entry into the service is imposed to entitle them to the benefit provisions of this section. Sec. 26.15.170. Short title. [Repealed, § 25 ch 94 SLA 1980.]