348.406. Certificates of guaranty--fee--limitations. - Missouri Statutes

Certificates of guaranty--fee--limitations.

348.406. 1. The authority, upon application, may issue certificatesof guaranty covering a first loss guarantee up to but not more than fiftypercent of the loan on a declining principal basis for loans to eligibleborrowers, executing a note or other evidence of a loan made for thepurpose of an agricultural business development loan, but not to exceed theamount of two hundred fifty thousand dollars for any eligible borrower andto pay from the fund to an eligible lender up to fifty percent of theamount on a declining principal basis of any loss on any guaranteed loanmade pursuant to the provisions of sections 348.400 to 348.415, in theevent of default on the loan. Upon payment on the guarantee, the authorityshall be subrogated to all the rights of the eligible lender.

2. The authority shall charge for each guaranteed loan a one-timeparticipation fee of one percent which shall be collected by the eligiblelender at the time of closing and paid to the authority. In addition, theauthority may charge a special loan guarantee fee of up to one percent perannum of the outstanding principal which shall be collected from theeligible borrower by the eligible lender and paid to the authority.

3. All moneys paid to satisfy a defaulted guaranteed loan shall onlybe paid out of the fund.

4. The total outstanding guaranteed loans shall at no time exceed anamount which, according to sound actuarial judgment, would allow immediateredemption of twenty percent of the outstanding loans guaranteed by thefund at any one time.

(L. 1997 H.B. 557, A.L. 1999 H.B. 888, A.L. 2004 S.B. 740, et al.)