December 16, 2021 - 11:09am
#1
Hello,
I need some opinions/guidance in respect to prohibited activities during MBL lending. 723.7(b) says:
(b) Equity agreements/joint ventures. A federally insured credit union may not grant a commercial loan if any additional income received by the credit union or its senior management employees is tied to the profit or sale of any business or commercial endeavor that benefits from the proceeds of the loan.
1. Is a loan to a dealership who is also a indirect lending partner in violation of this statement?
2. Is a loan to a business which rents space from the credit union in violation of this statement?
Thank you!
