(a) The commissioner of commerce, community, and economic development may, under regulations and policies, make the following loans:

(1) personal loans may be made for educational, domestic, remote area family housing and other personal purposes, not exceeding $10,000; the loans shall be secured by acceptable collateral when available but if not available the commissioner may make loans on the basis of good character; the rate of interest may not exceed nine and one-half percent a year on the unpaid balance;

(2) [Repealed, § 77 ch 106 SLA 1980.]

(3) business loans not exceeding $125,000 may be made to acquire, finance or refinance or equip businesses, including mining and fishing but not including farming, if the loan applicant has had three or more years of general business experience; the loans shall be secured by acceptable collateral and may not exceed 75 percent of the appraised value of the collateral offered as security; the rate of interest may not exceed nine and one-half percent a year on the unpaid balance;

(4) multiple dwelling loans not exceeding $110,000 may be made to purchase, remodel, repair, build, furnish, refinance or equip multiple dwellings; the loans shall be secured by acceptable collateral and may not exceed 75 percent of the appraised value of the collateral offered as security; the rate of interest may not exceed nine and one-half percent a year on the unpaid balance.

(b) The commissioner of commerce, community, and economic development may enter into agreements with private banks, other lending institutions and individuals for the purpose of guaranteeing loans made to qualified applicants. The guarantees may not exceed 90 percent of the amount loaned and the loans shall be secured in the same manner provided for direct loans under this section. A loan made under this subsection and guaranteed by the commissioner of commerce, community, and economic development and the state shall bear an interest rate not exceeding nine and one-half percent a year on the unpaid balance.

(c) Loans authorized by former (a)(2) of this section or (a)(3) and (4) of this section may not be made unless the commissioner of commerce, community, and economic development is satisfied that money at a comparable rate of interest is not available to the applicant from private lending institutions on a guaranteed basis as set out in (b) of this section. An applicant is eligible for more than one type of loan, but the total may not exceed $125,000 at any one time.

(d) Money loaned shall be disbursed to the borrower from the treasury, vouchered in the manner prescribed for state disbursing officers, and charged against the Alaska World War II veterans' revolving fund. Each voucher shall be approved by the commissioner of commerce, community, and economic development or any bonded deputy authorized to act as a certifying officer. Upon repayment of loans by installments, or otherwise, in accordance with the prescribed terms, or upon liquidation by foreclosure or other process, or upon receipt of interest, the money so received shall be turned over to the commissioner of revenue for deposit in the Alaska World War II veterans' revolving fund.

(e) If a loan made under (a)(3) of this section is assigned by the borrower or if the real property that secures a loan made under former (a)(2) or under (a)(4) of this section is transferred by the borrower, the commissioner of commerce, community, and economic development shall allow the assignee or transferee to assume the outstanding indebtedness on the loan unless the commissioner determines in writing that the credit of the assignee or transferee is not satisfactory to assure repayment of the loan. The assignee or transferee may assume the outstanding indebtedness on the loan at the existing interest rate on the loan.