- Alaska Statutes.
- Title 34. Property
- Chapter 8. Common Interest Ownership
- Section 270. Rights of Secured Lenders.
previous: Section 260
. Termination of Common Interest Community.
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. Master Associations.
AS 34.08.270. Rights of Secured Lenders.
- (a) A financial institution, including a commercial bank, mutual savings bank, savings and loan association, credit union
and mortgage company when acting as an ordinary money lender, whether secured or not, and providing financing for a
common interest community subject to the provisions of this chapter or to a declarant, unit owner, or purchaser for
that person's interest subject to the provisions of this chapter, is not liable under this chapter to a person for an
act, omission, warranty, product or structural defect, obligation, breach of contract or other duty arising from common
interest community financing.
- (b) For purposes of this section, "acting as an ordinary money lender" means a non-negligent action including, but not
limited to, property inspections, review of public offering statements, approval of declarations, plats and
construction plans and requiring proof of compliance with laws or codes to protect a lender's security interest or
otherwise assure the proper use of or repayment of its loan. A lender does not act as an ordinary money lender when it
is an affiliate of the declarant or possesses a direct equity interest other than an interest foreclosed upon in the
promotion, development, and sale of a common interest.
- (c) A declaration may require that all or a specified number or percentage of the lenders who hold security interests
encumbering the units approve specified actions of the unit owners or the association as a condition to the
effectiveness of the action, but a requirement for approval does not operate to
- (1) deny or delegate control over the general administrative affairs of the association by the unit owners or the
- (2) prevent the association or the executive board from commencing, intervening in, or settling any litigation or
- (3) prevent an insurance trustee or the association from receiving and distributing insurance proceeds except under AS 34.08.440
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