(a) Subject to the provisions of this chapter and regulations under this chapter, a mutual bank may invest in first mortgages on unencumbered real property, including leasehold estates, subject to the following limitations:

(1) an investment in mortgages executed by any one mortgagor may not exceed in the aggregate two percent of the assets of the mutual bank at the time the investment is made, or $37,500 on a single family dwelling or $50,000 on a multiple family dwelling or other improved realty, whichever is greater;

(2) an investment in any one mortgage may not exceed two percent of the assets of the mutual bank at the time the investment is made, or as specified in (1) of this subsection, whichever is greater, or more than 80 percent of the appraised value of a one- to four-family residence securing a conventional loan; however, a mutual bank may make 95 percent of appraised value loans if the term of the loan does not exceed 30 years from the date of the first payment, and if the first payment date is no later than 60 days following final disbursement of the loan, and the loan is secured by an amortized mortgage, deed of trust, or other instrument under the terms of which the installment payments are sufficient to amortize the entire principal of the loan within the period ending on the date of its maturity and, in addition, the loan is either

(A) insured by mortgage insurance in an amount equal to 20 percent of the loan issued by a mortgage insurer authorized to do business in Alaska; or

(B) the loan is secured in addition to the amortized mortgage by a savings account held by the lending institution in an amount equal to 10 percent of the loan or other collateral acceptable to the department;

(3) except as provided in (2) of this subsection, an investment may not be made in a conventional loan secured by a mortgage on a one- to four-family residence unless the mortgaged property is located inside this state and the mortgage has a maturity not exceeding 30 years from the date of the first payment, and if the first payment date is no later than 60 days following final disbursement of the loan;

(4) an investment may not be made in a conventional loan if the aggregate unpaid principal of all conventional loans exceeds 80 percent of deposits plus all borrowings from the Federal Home Loan Bank;

(5) participation in mortgage loans with others as co-mortgagees may not be permitted except with one or more financial institutions, trusts, or pension funds;

(6) an investment may not be made in a mortgage upon a leasehold unless

(A) the leasehold has an unexpired term of not less than 21 years;

(B) the principal amount of the mortgage loan is not in excess of 70 percent of the appraised value of the leasehold; and

(C) provision is made for complete amortization of the loan within an unexpired term by periodic payments as the department may prescribe.

(b) In this section, “real property” includes a manufactured home that has become real property under AS 34.85.010. In this subsection, “manufactured home” has the meaning given in AS 45.29.102.