13.1-987 - Restrictions on powers of corporation. - Virginia Statutes

§ 13.1-987. Restrictions on powers of corporation.

The powers of a corporation shall be subject to the following restrictions:

1. It shall not approve any application for a loan until the applicant shallhave shown that he has applied to a financial institution that could lawfullylend the amount of money sought and that the financial institution hasrefused in writing to make the requested loan.

2. It shall not incur any secondary liability for the debts of others, butmay assume primary liability therefor.

3. It shall not give security for any loan made to it unless all loans to itare secured ratably in proportion to unpaid balances due, except that it maygive security or priority on loans made to it by any federal agency orinstrumentality or by any agency or instrumentality of the Commonwealth ofVirginia without securing all loans made to it.

(Code 1950, § 13.1-145; 1960, c. 80; 1972, c. 693; 1985, c. 522.)