{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/2.2-2288.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/2.2-2288.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/2.2-2288.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/2.2-2288.html"}],"law_id":71590,"edition_id":1,"section_id":71590,"structure_id":13623,"section_number":"2.2-2288","catch_line":"Power to issue bonds to purchase ninety percent guaranteed portion of loans","history":"1984, c. 749, \u00a7 9-209; 2001, c. 844.","full_text":"In addition to and not as a limitation upon the powers to issue bonds as elsewhere expressed in this article, the Authority may, with proceeds of an issue of its bonds, participate with lenders in making or purchasing small business loans, not exceeding as to any one such loan one million dollars in principal amount, to be serviced by such lenders, provided that:\n\n1\n\nThe Authority’s share shall not exceed ninety percent of the total principal amount of any such loan, and such participation shall be payable with interest at the same times, but not necessarily at the same interest rate, as the share of the lender, and both shares shall be equally and ratably secured by a valid mortgage on, or security interest in, real or personal property or by any other security satisfactory to the Authority to secure payment of the loan; however, the Authority’s share of any such loan may equal 100 percent of the total principal amount of the small business loan if the lender participating in the making or purchasing of such small business loan by servicing the loan, purchases 100 percent of the total amount of the bonds issued by the Authority in connection with or allocable to such small business loan;2\n\nThe total principal amount of the Authority’s share shall not exceed ninety percent of the value of the property securing the small business loan, unless the amount in excess of ninety percent is:\n\t\t\ta. Loaned from available funds that are not proceeds received directly from the sale of the Authority’s bonds and are not restricted under the terms of the resolution authorizing, or the indenture securing such bonds, or\n\t\t\tb. Insured or guaranteed by a federal agency or by a private insurer qualified to write such insurance in the Commonwealth, insuring a percentage of any claim for loss at least equal to that percentage of the value by which the small business loan exceeds ninety percent thereof;3\n\nThe value of the property securing the small business loan is certified by the participating lender, on the basis of such appraisals, bids, purchase orders, and engineers’ certificates as the Authority may require; provided that the value of items purchased and constructed from the proceeds of the small business loan shall not be deemed, for purposes of this section, to exceed the contract price in respect of purchase or construction;4\n\nThe Authority shall not disburse funds under a commitment to participate in a small business loan for the construction or substantial improvement of property until the construction or improvement has been completed, unless a lender furnishes an irrevocable letter of credit or a qualified corporate surety furnishes payment and performance bonds, in either event satisfactory to the Authority and in an aggregate amount equal to the cost of such construction or improvement;5\n\nNo other indebtedness may be secured by a mortgage on, or security interest in, property securing a small business loan made or purchased pursuant to this subdivision without the prior express written authorization of the Authority; and6\n\nThe participating lender agrees to use the proceeds of the small business loan to lend to eligible small businesses in the Commonwealth.","order_by":null,"text":{"0":{"id":258032,"text":"In addition to and not as a limitation upon the powers to issue bonds as elsewhere expressed in this article, the Authority may, with proceeds of an issue of its bonds, participate with lenders in making or purchasing small business loans, not exceeding as to any one such loan one million dollars in principal amount, to be serviced by such lenders, provided that:","type":"section","prefixes":[""],"prefix":"","entire_prefix":"","prefix_anchor":"","level":1,"next_prefix":"1"},"1":{"id":258033,"text":"The Authority’s share shall not exceed ninety percent of the total principal amount of any such loan, and such participation shall be payable with interest at the same times, but not necessarily at the same interest rate, as the share of the lender, and both shares shall be equally and ratably secured by a valid mortgage on, or security interest in, real or personal property or by any other security satisfactory to the Authority to secure payment of the loan; however, the Authority’s share of any such loan may equal 100 percent of the total principal amount of the small business loan if the lender participating in the making or purchasing of such small business loan by servicing the loan, purchases 100 percent of the total amount of the bonds issued by the Authority in connection with or allocable to such small business loan;","type":"section","prefixes":["1"],"prefix":"1","entire_prefix":"1","prefix_anchor":"1","level":1,"prior_prefix":"","next_prefix":"2"},"2":{"id":258034,"text":"The total principal amount of the Authority’s share shall not exceed ninety percent of the value of the property securing the small business loan, unless the amount in excess of ninety percent is:\n\t\t\ta. Loaned from available funds that are not proceeds received directly from the sale of the Authority’s bonds and are not restricted under the terms of the resolution authorizing, or the indenture securing such bonds, or\n\t\t\tb. Insured or guaranteed by a federal agency or by a private insurer qualified to write such insurance in the Commonwealth, insuring a percentage of any claim for loss at least equal to that percentage of the value by which the small business loan exceeds ninety percent thereof;","type":"section","prefixes":["2"],"prefix":"2","entire_prefix":"2","prefix_anchor":"2","level":1,"prior_prefix":"1","next_prefix":"3"},"3":{"id":258035,"text":"The value of the property securing the small business loan is certified by the participating lender, on the basis of such appraisals, bids, purchase orders, and engineers’ certificates as the Authority may require; provided that the value of items purchased and constructed from the proceeds of the small business loan shall not be deemed, for purposes of this section, to exceed the contract price in respect of purchase or construction;","type":"section","prefixes":["3"],"prefix":"3","entire_prefix":"3","prefix_anchor":"3","level":1,"prior_prefix":"2","next_prefix":"4"},"4":{"id":258036,"text":"The Authority shall not disburse funds under a commitment to participate in a small business loan for the construction or substantial improvement of property until the construction or improvement has been completed, unless a lender furnishes an irrevocable letter of credit or a qualified corporate surety furnishes payment and performance bonds, in either event satisfactory to the Authority and in an aggregate amount equal to the cost of such construction or improvement;","type":"section","prefixes":["4"],"prefix":"4","entire_prefix":"4","prefix_anchor":"4","level":1,"prior_prefix":"3","next_prefix":"5"},"5":{"id":258037,"text":"No other indebtedness may be secured by a mortgage on, or security interest in, property securing a small business loan made or purchased pursuant to this subdivision without the prior express written authorization of the Authority; and","type":"section","prefixes":["5"],"prefix":"5","entire_prefix":"5","prefix_anchor":"5","level":1,"prior_prefix":"4","next_prefix":"6"},"6":{"id":258038,"text":"The participating lender agrees to use the proceeds of the small business loan to lend to eligible small businesses in the Commonwealth.","type":"section","prefixes":["6"],"prefix":"6","entire_prefix":"6","prefix_anchor":"6","level":1,"prior_prefix":"5"}},"ancestry":[{"id":13623,"edition_id":1,"name":"Virginia Small Business Financing Authority","identifier":"7","label":"article","depth":5,"order_by":1,"parent_id":13344,"metadata":{},"date_created":"2026-06-26 03:45:24","date_modified":"2026-06-26 03:45:24","permalink":{"id":174461,"object_type":"structure","relational_id":13623,"identifier":"7","token":"2.2\/I\/D\/22\/7","url":"\/2.2\/I\/D\/22\/7\/","edition_id":1,"permalink":0,"preferred":1}},{"id":13344,"edition_id":1,"name":"Authorities","identifier":"22","label":"chapter","depth":4,"order_by":1,"parent_id":12785,"metadata":{},"date_created":"2026-06-26 03:44:41","date_modified":"2026-06-26 03:44:41","permalink":{"id":173945,"object_type":"structure","relational_id":13344,"identifier":"22","token":"2.2\/I\/D\/22","url":"\/2.2\/I\/D\/22\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12785,"edition_id":1,"name":"State Authorities, Boards, Commissions, Councils, Foundations and Other Collegial Bodies","identifier":"D","label":"part","depth":3,"order_by":1,"parent_id":12784,"metadata":{},"date_created":"2026-06-26 03:43:53","date_modified":"2026-06-26 03:43:53","permalink":{"id":173913,"object_type":"structure","relational_id":12785,"identifier":"D","token":"2.2\/I\/D","url":"\/2.2\/I\/D\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12784,"edition_id":1,"name":"Organization of State Government","identifier":"I","label":"subtitle","depth":2,"order_by":1,"parent_id":12749,"metadata":{},"date_created":"2026-06-26 03:43:53","date_modified":"2026-06-26 03:43:53","permalink":{"id":171455,"object_type":"structure","relational_id":12784,"identifier":"I","token":"2.2\/I","url":"\/2.2\/I\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12749,"edition_id":1,"name":"Administration of Government","identifier":"2.2","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:43:51","date_modified":"2026-06-26 03:43:51","permalink":{"id":171453,"object_type":"structure","relational_id":12749,"identifier":"2.2","token":"2.2","url":"\/2.2\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":58804,"structure_id":13623,"section_number":"2.2-2279","catch_line":"Short title; definitions","url":"\/2.2-2279\/","token":"2.2\/I\/D\/22\/7\/2.2-2279","metadata":false},{"id":57453,"structure_id":13623,"section_number":"2.2-2280","catch_line":"Declaration of public purpose; Authority created","url":"\/2.2-2280\/","token":"2.2\/I\/D\/22\/7\/2.2-2280","metadata":false},{"id":57343,"structure_id":13623,"section_number":"2.2-2281","catch_line":"Construction of article","url":"\/2.2-2281\/","token":"2.2\/I\/D\/22\/7\/2.2-2281","metadata":false},{"id":76362,"structure_id":13623,"section_number":"2.2-2282","catch_line":"Board of directors; membership; terms, compensation and expenses; chairman, vice-chairman, secretary and treasurer; quorum; staff","url":"\/2.2-2282\/","token":"2.2\/I\/D\/22\/7\/2.2-2282","metadata":false},{"id":64953,"structure_id":13623,"section_number":"2.2-2283","catch_line":"Meetings of the Board","url":"\/2.2-2283\/","token":"2.2\/I\/D\/22\/7\/2.2-2283","metadata":false},{"id":57687,"structure_id":13623,"section_number":"2.2-2284","catch_line":"Executive Director; appointment; duties","url":"\/2.2-2284\/","token":"2.2\/I\/D\/22\/7\/2.2-2284","metadata":false},{"id":84552,"structure_id":13623,"section_number":"2.2-2285","catch_line":"Powers of the Authority","url":"\/2.2-2285\/","token":"2.2\/I\/D\/22\/7\/2.2-2285","metadata":false},{"id":74688,"structure_id":13623,"section_number":"2.2-2286","catch_line":"Power to condemn","url":"\/2.2-2286\/","token":"2.2\/I\/D\/22\/7\/2.2-2286","metadata":false},{"id":54625,"structure_id":13623,"section_number":"2.2-2287","catch_line":"Power to borrow money and issue bonds","url":"\/2.2-2287\/","token":"2.2\/I\/D\/22\/7\/2.2-2287","metadata":false},{"id":71590,"structure_id":13623,"section_number":"2.2-2288","catch_line":"Power to issue bonds to purchase ninety percent guaranteed portion of loans","url":"\/2.2-2288\/","token":"2.2\/I\/D\/22\/7\/2.2-2288","metadata":false},{"id":83086,"structure_id":13623,"section_number":"2.2-2289","catch_line":"Power to issue umbrella bonds","url":"\/2.2-2289\/","token":"2.2\/I\/D\/22\/7\/2.2-2289","metadata":false},{"id":75308,"structure_id":13623,"section_number":"2.2-2290","catch_line":"Insurance or guarantee fund","url":"\/2.2-2290\/","token":"2.2\/I\/D\/22\/7\/2.2-2290","metadata":false},{"id":78908,"structure_id":13623,"section_number":"2.2-2291","catch_line":"Security for bonds; fees and expenses; limitations","url":"\/2.2-2291\/","token":"2.2\/I\/D\/22\/7\/2.2-2291","metadata":false},{"id":61903,"structure_id":13623,"section_number":"2.2-2292","catch_line":"Public hearing and approval","url":"\/2.2-2292\/","token":"2.2\/I\/D\/22\/7\/2.2-2292","metadata":false},{"id":57038,"structure_id":13623,"section_number":"2.2-2293","catch_line":"Loans to lenders; conditions","url":"\/2.2-2293\/","token":"2.2\/I\/D\/22\/7\/2.2-2293","metadata":false},{"id":60840,"structure_id":13623,"section_number":"2.2-2294","catch_line":"Investment in, purchase or assignment of loans; conditions","url":"\/2.2-2294\/","token":"2.2\/I\/D\/22\/7\/2.2-2294","metadata":false},{"id":84283,"structure_id":13623,"section_number":"2.2-2295","catch_line":"Regulations of the Authority","url":"\/2.2-2295\/","token":"2.2\/I\/D\/22\/7\/2.2-2295","metadata":false},{"id":59895,"structure_id":13623,"section_number":"2.2-2296","catch_line":"How bonds paid and secured","url":"\/2.2-2296\/","token":"2.2\/I\/D\/22\/7\/2.2-2296","metadata":false},{"id":86041,"structure_id":13623,"section_number":"2.2-2297","catch_line":"Liability of Commonwealth, political subdivisions and members of Board","url":"\/2.2-2297\/","token":"2.2\/I\/D\/22\/7\/2.2-2297","metadata":false},{"id":79714,"structure_id":13623,"section_number":"2.2-2298","catch_line":"Authorization of bonds by resolution; contents of bond sale; manner","url":"\/2.2-2298\/","token":"2.2\/I\/D\/22\/7\/2.2-2298","metadata":false},{"id":67046,"structure_id":13623,"section_number":"2.2-2299","catch_line":"Resolution authorizing issuance of bonds; provisions","url":"\/2.2-2299\/","token":"2.2\/I\/D\/22\/7\/2.2-2299","metadata":false},{"id":71824,"structure_id":13623,"section_number":"2.2-2300","catch_line":"Pledge by Authority","url":"\/2.2-2300\/","token":"2.2\/I\/D\/22\/7\/2.2-2300","metadata":false},{"id":66573,"structure_id":13623,"section_number":"2.2-2301","catch_line":"Purchase of bonds of Authority","url":"\/2.2-2301\/","token":"2.2\/I\/D\/22\/7\/2.2-2301","metadata":false},{"id":76359,"structure_id":13623,"section_number":"2.2-2302","catch_line":"Bonds secured by indenture; contents; expenses; how treated","url":"\/2.2-2302\/","token":"2.2\/I\/D\/22\/7\/2.2-2302","metadata":false},{"id":68741,"structure_id":13623,"section_number":"2.2-2303","catch_line":"Signatures of prior members or officers; validity","url":"\/2.2-2303\/","token":"2.2\/I\/D\/22\/7\/2.2-2303","metadata":false},{"id":78197,"structure_id":13623,"section_number":"2.2-2304","catch_line":"Deposit of money; expenditures; security for deposits","url":"\/2.2-2304\/","token":"2.2\/I\/D\/22\/7\/2.2-2304","metadata":false},{"id":66422,"structure_id":13623,"section_number":"2.2-2305","catch_line":"Contracts with holders of bonds; how money secured","url":"\/2.2-2305\/","token":"2.2\/I\/D\/22\/7\/2.2-2305","metadata":false},{"id":63890,"structure_id":13623,"section_number":"2.2-2306","catch_line":"Bondholder protection","url":"\/2.2-2306\/","token":"2.2\/I\/D\/22\/7\/2.2-2306","metadata":false},{"id":76612,"structure_id":13623,"section_number":"2.2-2307","catch_line":"Bonds as legal investments and securities","url":"\/2.2-2307\/","token":"2.2\/I\/D\/22\/7\/2.2-2307","metadata":false},{"id":84851,"structure_id":13623,"section_number":"2.2-2308","catch_line":"Expenses of Authority; liability of Commonwealth or political subdivision prohibited","url":"\/2.2-2308\/","token":"2.2\/I\/D\/22\/7\/2.2-2308","metadata":false},{"id":85768,"structure_id":13623,"section_number":"2.2-2309","catch_line":"Creation, administration, and management of Virginia Export Fund","url":"\/2.2-2309\/","token":"2.2\/I\/D\/22\/7\/2.2-2309","metadata":false},{"id":54591,"structure_id":13623,"section_number":"2.2-2310","catch_line":"Creation, administration, and management of Virginia Small Business Growth Fund","url":"\/2.2-2310\/","token":"2.2\/I\/D\/22\/7\/2.2-2310","metadata":false},{"id":65463,"structure_id":13623,"section_number":"2.2-2311","catch_line":"Repealed","url":"\/2.2-2311\/","token":"2.2\/I\/D\/22\/7\/2.2-2311","metadata":false},{"id":60227,"structure_id":13623,"section_number":"2.2-2311.1","catch_line":"Creation, administration, and management of the Small, Women-owned, and Minority-owned Business Loan Fund","url":"\/2.2-2311.1\/","token":"2.2\/I\/D\/22\/7\/2.2-2311.1","metadata":false},{"id":66627,"structure_id":13623,"section_number":"2.2-2312","catch_line":"Annual report; audit","url":"\/2.2-2312\/","token":"2.2\/I\/D\/22\/7\/2.2-2312","metadata":false},{"id":67073,"structure_id":13623,"section_number":"2.2-2312.1","catch_line":"Risk-based review of outstanding loans; report","url":"\/2.2-2312.1\/","token":"2.2\/I\/D\/22\/7\/2.2-2312.1","metadata":false},{"id":82478,"structure_id":13623,"section_number":"2.2-2313","catch_line":"Exemption from taxation","url":"\/2.2-2313\/","token":"2.2\/I\/D\/22\/7\/2.2-2313","metadata":false},{"id":86107,"structure_id":13623,"section_number":"2.2-2314","catch_line":"Administrative Process Act not applicable","url":"\/2.2-2314\/","token":"2.2\/I\/D\/22\/7\/2.2-2314","metadata":false}],"previous_section":{"id":54625,"structure_id":13623,"section_number":"2.2-2287","catch_line":"Power to borrow money and issue bonds","url":"\/2.2-2287\/","token":"2.2\/I\/D\/22\/7\/2.2-2287","metadata":false},"next_section":{"id":83086,"structure_id":13623,"section_number":"2.2-2289","catch_line":"Power to issue umbrella bonds","url":"\/2.2-2289\/","token":"2.2\/I\/D\/22\/7\/2.2-2289","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/2.2-2288\/","history_text":"

This law was first created in 1984. The record of its establishment is cataloged in chapter 749 of that year\u2019s edition of \u201cActs of Assembly,\u201d the annual state publication listing all changes made to the Code of Virginia in that year. Unfortunately, the 1984 \u201cActs\u201d aren\u2019t available online. It has been modified 1 time. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. That modification is as follows: in 2001, chapter 844<\/a>.<\/p>","references":false,"refers_to":false,"permalink":{"id":174499,"object_type":"law","relational_id":71590,"identifier":"2.2-2288","token":"2.2\/I\/D\/22\/7\/2.2-2288","url":"\/2.2-2288\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/2.2-2288\/","token":"2.2\/I\/D\/22\/7\/2.2-2288","dublin_core":{"Title":"Power to issue bonds to purchase ninety percent guaranteed portion of loans","Type":"Text","Format":"text\/html","Identifier":"\u00a7 2.2-2288","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

In addition to and not as a limitation upon the powers to issue<\/span> bonds<\/span><\/span> as elsewhere expressed in this article, the Authority<\/span> may, with proceeds of an issue<\/span> of its bonds<\/span><\/span>, participate with lenders in making or purchasing small business loans, not exceeding as to any one such loan one million dollars in principal amount, to be serviced by such lenders, provided that:<\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> The Authority<\/span>’s share shall not exceed ninety percent of the total principal amount of any such loan, and such participation shall be payable with interest at the same times, but not necessarily at the same interest rate, as the share of the lender, and both shares shall be equally and ratably secured by a valid mortgage on, or security interest in, real or personal property or by any other security satisfactory to the Authority<\/span> to secure payment of the loan; however, the Authority<\/span>’s share of any such loan may equal 100 percent of the total principal amount of the small business loan if the lender participating in the making or purchasing of such small business loan by servicing the loan, purchases 100 percent of the total amount of the bonds<\/span><\/span> issued by the Authority<\/span> in connection with or allocable to such small business loan; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> The total principal amount of the Authority<\/span>’s share shall not exceed ninety percent of the value of the property securing the small business loan, unless the amount in excess of ninety percent is:\n\t\t\ta. Loaned from available funds that are not proceeds received directly from the sale of the Authority<\/span>’s bonds<\/span><\/span> and are not restricted under the terms of the resolution authorizing, or the indenture securing such bonds<\/span><\/span>, or\n\t\t\tb. Insured or guaranteed by a federal agency<\/span> or by a private insurer qualified to write such insurance in the Commonwealth<\/span>, insuring a percentage of any claim for loss at least equal to that percentage of the value by which the small business loan exceeds ninety percent thereof; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> The value of the property securing the small business loan is certified by the participating lender, on the basis of such appraisals, bids, purchase orders<\/span>, and engineers’ certificates as the Authority<\/span> may require; provided that the value of items purchased and constructed from the proceeds of the small business loan shall not be deemed, for purposes of this section, to exceed the contract<\/span> price in respect of purchase or construction; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

4.<\/span> The Authority<\/span> shall not disburse funds under a commitment to participate in a small business loan for the construction or substantial improvement of property until the construction or improvement has been completed, unless a lender furnishes an irrevocable letter of credit or a qualified corporate surety<\/span> furnishes payment and performance bonds<\/span><\/span>, in either event satisfactory to the Authority<\/span> and in an aggregate amount equal to the cost of such construction or improvement; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

5.<\/span> No other indebtedness may be secured by a mortgage on, or security interest in, property securing a small business loan made or purchased pursuant to this subdivision without the prior express written authorization of the Authority<\/span>; and <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

6.<\/span> The participating lender agrees to use the proceeds of the small business loan to lend to eligible small businesses in the Commonwealth<\/span>. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nPOWER TO ISSUE BONDS TO PURCHASE NINETY PERCENT GUARANTEED PORTION OF LOANS (\u00a7\n2.2-2288)\n\nIn addition to and not as a limitation upon the powers to issue bonds as\nelsewhere expressed in this article, the Authority may, with proceeds of an\nissue of its bonds, participate with lenders in making or purchasing small\nbusiness loans, not exceeding as to any one such loan one million dollars in\nprincipal amount, to be serviced by such lenders, provided that:\n\n1. The Authority’s share shall not exceed ninety percent of the total\nprincipal amount of any such loan, and such participation shall be payable with\ninterest at the same times, but not necessarily at the same interest rate, as\nthe share of the lender, and both shares shall be equally and ratably secured by\na valid mortgage on, or security interest in, real or personal property or by\nany other security satisfactory to the Authority to secure payment of the loan;\nhowever, the Authority’s share of any such loan may equal 100 percent of\nthe total principal amount of the small business loan if the lender\nparticipating in the making or purchasing of such small business loan by\nservicing the loan, purchases 100 percent of the total amount of the bonds\nissued by the Authority in connection with or allocable to such small business\nloan;\n\n2. The total principal amount of the Authority’s share shall not exceed\nninety percent of the value of the property securing the small business loan,\nunless the amount in excess of ninety percent is:\n\t\t\ta. Loaned from available funds that are not proceeds received directly from\nthe sale of the Authority’s bonds and are not restricted under the terms\nof the resolution authorizing, or the indenture securing such bonds, or\n\t\t\tb. Insured or guaranteed by a federal agency or by a private insurer\nqualified to write such insurance in the Commonwealth, insuring a percentage of\nany claim for loss at least equal to that percentage of the value by which the\nsmall business loan exceeds ninety percent thereof;\n\n3. The value of the property securing the small business loan is certified by\nthe participating lender, on the basis of such appraisals, bids, purchase\norders, and engineers’ certificates as the Authority may require; provided\nthat the value of items purchased and constructed from the proceeds of the small\nbusiness loan shall not be deemed, for purposes of this section, to exceed the\ncontract price in respect of purchase or construction;\n\n4. The Authority shall not disburse funds under a commitment to participate in a\nsmall business loan for the construction or substantial improvement of property\nuntil the construction or improvement has been completed, unless a lender\nfurnishes an irrevocable letter of credit or a qualified corporate surety\nfurnishes payment and performance bonds, in either event satisfactory to the\nAuthority and in an aggregate amount equal to the cost of such construction or\nimprovement;\n\n5. No other indebtedness may be secured by a mortgage on, or security interest\nin, property securing a small business loan made or purchased pursuant to this\nsubdivision without the prior express written authorization of the Authority;\nand\n\n6. The participating lender agrees to use the proceeds of the small business\nloan to lend to eligible small businesses in the Commonwealth.\n\nHISTORY: 1984, c. 749, \u00a7 9-209; 2001, c. 844.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}