Section 6-27-12 - First mortgage loans; minimum and maximum loan amounts(a) No member home loan secured by a first mortgage on unencumbered improved real estate owned in fee simple shall exceed eighty per cent of the lesser of the purchase price or the appraised value of the real estate mortgaged to secure it.(b) No member home loan secured by a first mortgage on leasehold interest in improved real estate shall exceed eighty per cent of the lesser of the purchase price or the appraised value of the leasehold interest and improvements.(c) If the purpose of the member home loan is to satisfy an agreement of sale, the loan-to-value ratio shall be the lesser of the purchase price, if purchased less than one year ago, or the appraised value.(d) If the loan-to-value ratio is over eighty per cent, lenders shall obtain the system's prior written approval for mortgage insurance. The mortgage insurance shall be obtained from a mortgage insurer licensed to do business in the State of Hawaii and shall insure or guarantee against the borrower's default or loss sufficient to reduce the system's exposure to not more than eighty per cent of the value of the mortgaged property. Mortgage insurance coverage shall remain in force until the principal amount of the loan is reduced to eighty per cent of the market value of the mortgaged property, at which time the coverage shall be subject to cancellation solely at the board's option. The borrow shall pay for the premiums for the insurance.(e) No member home loan secured by a first mortgage shall be made in an amount which is less than or greater than the minimum or maximum loan amounts set by the board of trustees. The minimum and maximum loan amounts shall be set and may be periodically adjusted by the board of trustees at any of its regularly scheduled meetings. Notice of the board's intention to adjust the minimum and maximum loan amounts shall be included in the agenda for the meeting at which loan amounts shall be set or adjusted.(f) There shall be a minimum cash equity of ten per cent of the purchase price for home purchases.[Eff 2/9/89; am 12/24/90; am 6/11/92] (Auth: HRS §§ 88-28, 88-119.5) (Imp: HRS §§ 88-119, 88-119.5)