§ 116-174.1. Minors authorized to borrow for higher education; interest; requirements of loans. - North Carolina Statutes

Article 18A.

Contracts of Minors Borrowing for Higher Education;Scholarship Revocation.

§ 116‑174.1.  Minors authorized to borrow forhigher education; interest; requirements of loans.

All minors in North Carolina of the age of 17 years and upwards shallhave full power and authority to enter into written contracts of indebtedness,at a rate of interest not exceeding the contract rate authorized in Chapter 24of the General Statutes, with persons and educational institutions or withfirms and corporations licensed to do business in North Carolina and to executenotes evidencing such indebtedness. Such loans shall be:

(1)        Unsecured by the conveyance of any property as security,whether real, personal or mixed;

(2)        For the sole purpose of borrowing money to obtain post‑secondaryeducation at an accredited college, university, junior college, communitycollege, business or trade school provided, however, that none of the proceedsof such loans shall be used to pay for any correspondence courses;

(3)        The proceeds of any loan shall be disbursed either directlyto the educational institution for the benefit of the borrower or jointly tothe borrower and the educational institution. (1963, c. 780; 1969, c. 1073; 1987, c. 564, s. 36.)