Haw. Code R. § 15-2-9 - Maximum loan amount; loan terms and restrictions
(a) No loans
shall be granted unless financial assistance is not available to the applicant.
The condition may be waived by the director for participation loans with a
private financial institution.
(b)
Direct and participating loans to any one applicant shall not exceed $1,000,000
in state funds.
(c) The director
shall determine the extent and kinds of security required for each loan. When
loans are secured, such security may be subordinated to direct loans made by
financial institutions.
(d) No loan
shall be granted for a period exceeding twenty years. The following guidelines
shall be used by the department is setting loan terms;
(1) Working capital loans shall in most
instances be for a maximum of six years;
(2) Loans to purchase fixed assets, including
land, construction, etc., may be for periods up to a maximum of twenty years,
but normally shall be ten years.
(e) Each loan shall bear a simple interest at
a rate one per cent below the prime rate or at a rate of seven and one-half per
cent a year, whichever is lower. For purposes of this paragraph, the prime rate
is determined on January 1 and July 1 of each year by the rate charged by the
two largest banks in the State of Hawaii identified by the Department of
Commerce and Consumer Affairs division of financial institutions. Should there
be a difference in rate charged by the Institutions, the lower of the two shall
be utilized.
(f) The director shall
determine the commencement date for the repayment of the first installment. The
director may defer the initial payment on the principal of a loan, but in no
event shall the principal payments be deferred in excess of five years from
date of issuance of the loan.
(g)
The director may defer the interest on the principal of a loan, but in no event
shall interest payments be deferred in excess of two years from the date of
issuance of the loan.
Notes
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