State Codes and Statutes

Statutes > Utah > Title-07 > Chapter-09 > 7-9-58

7-9-58. Limitations on credit extended by nonexempt credit unions.
(1) (a) Notwithstanding the other provisions of this chapter, beginning on May 5, 2003, anonexempt credit union may not:
(i) (A) extend a member-business loan;
(B) renew a member-business loan that is extended before May 5, 2003; or
(C) extend the maturity date or increase the amount of a member-business loan that isextended before May 5, 2003;
(ii) originate, participate in, or obtain any interest in a co-lending arrangement, includinga loan participation arrangement; or
(iii) subject to Subsection (2), extend credit that is not a member-business loan if as aresult of the extension of credit the total credit that is not a member-business loan that thenonexempt credit union has issued to that member exceeds at any one time $250,000 adjusted asprovided in Subsection (1)(b).
(b) The adjustment described in Subsection (1)(a)(iii) shall be calculated by thecommissioner as follows:
(i) beginning July 1, 2008 and for a calendar year beginning on or after January 1, 2009,the commissioner shall increase or decrease the dollar amount in Subsection (1)(a)(iii) by apercentage equal to the percentage difference between the consumer price index for the precedingcalendar year and the consumer price index for calendar year 2007;
(ii) after the commissioner increases the dollar amount listed in Subsection (1)(c), thecommissioner shall round the dollar amount to the nearest whole dollar;
(iii) if the percentage difference under Subsection (1)(b)(i) is zero or a negativepercentage, the consumer price index increase for the year is zero; and
(iv) for purposes of this Subsection (1)(b), the commissioner shall calculate the consumerprice index as provided in Sections 1(f)(4) and 1(f)(5), Internal Revenue Code.
(2) Notwithstanding Subsection (1)(a)(iii), a nonexempt credit union may extend creditin an amount that exceeds the limits provided in Subsection (1)(a)(iii) to a member if:
(a) the excess portion of the credit described in Subsection (1)(a)(iii) is fully secured bythe member's share or deposit savings in the nonexempt credit union; or
(b) the credit is extended to a member of the nonexempt credit union:
(i) for the purpose of:
(A) paying amounts owed by the member to purchase a one- to four-family dwelling thatis the primary residence of that member; or
(B) refinancing the balance of amounts owed by the member for the purchase of a one- tofour-family dwelling that is the primary residence of that member; and
(ii) the credit extended under this Subsection (2)(b) is less than or equals $1,000,000.
(3) In accordance with Subsection 7-9-20(7)(d), a credit union service organization maynot extend credit to a member of a nonexempt credit union holding an ownership interest in thecredit union service organization if it would be a violation of this section for the nonexemptcredit union to extend the credit to the member.
(4) This section may not prevent a nonexempt credit union from servicing a loanextended before May 5, 2003.

Amended by Chapter 126, 2008 General Session