6.2-879 - (Effective October 1, 2010) Certain loans not considered loans secured by real estate. - Virginia Statutes

§ 6.2-879. (Effective October 1, 2010) Certain loans not considered loanssecured by real estate.

A. If the bank reasonably and prudently relies upon factors other than or inaddition to the real estate security, such as general credit standing,guarantees, commitments, or tangible or intangible personal propertysecurity, and enters in its records a written statement of the factors itrelies on, the loan does not constitute a loan secured by real estate withinthe meaning of § 6.2-878, except that if the terms of the transaction shallbe more favorable than in the absence of a lien, an appraisal shall berequired as provided under § 6.2-878.

B. Loans made to homeowners for maintenance, repair, landscaping,modernization, alteration, improvement to, and furnishings and equipment for,their homes, whether or not secured, shall not be considered as loans securedby real estate within the meaning of § 6.2-878, provided each such loan shall(i) be payable in approximately equal monthly installments, (ii) not be for aterm longer than 12 years, and (iii) not exceed an amount specified inaccordance with subsection C of § 6.2-878. Such home loans may otherwise bemade under the provisions of § 6.2-878 or 6.2-880. If such loan is in excessof the amount specified under subsection C of § 6.2-878, unless the taking ofreal estate security is solely in the abundance of caution and the terms arenot more favorable than in the absence of such a real estate lien, anappraisal as required by § 6.2-878 or 6.2-880 shall be required by the bank.

(Code 1950, §§ 6-78, 6-79.2; 1952, c. 25; 1956, c. 622; 1960, c. 23; 1962, c.267; 1964, c. 150; 1966, c. 584, §§ 6.1-65, 6.1-66; 1970, c. 13; 1976, c. 94;1980, c. 714; 1991, c. 160; 1994, c. 501; 2005, c. 263; 2010, c. 794.)