Section 15-3-8 - Claims Process(a) The lender shall exercise reasonable care and diligence in its collection efforts on all capital access loans. The minimum standard of care to be exercised by the lender in its collection efforts on capital access loans shall be no less than the standard of care exercised by the lender in its collection efforts on its conventional business loans.(b) The lender may submit to the department a claim form seeking reimbursement for losses actually incurred on a capital access loan only after: (1) The lender has exhausted all legal remedies against the borrower and all guarantors, including, but not limited to the garnishment, seizure, foreclosure, repossession, and liquidation of all collateral;(2) The lender has charged off the capital access loan in accordance with the lender's usual and customary practice and policy for charging off its conventional business loans; and(3) The lender makes a good faith determination that any further collection efforts would be futile, and no longer economically feasible. The amount of the claim for reimbursement shall be limited to the amount of principal charged off that is covered under the program as described in section 15-3-4(b), together with accrued interest, and any out-of-pocket collection expenses reasonably incurred.
(c) In the event that a lender simultaneously submits claims for reimbursement involving more than one capital access loan, and the funds available in the reserve account are insufficient to cover all of the claims submitted, then the lender may designate the order of priority of the claims in which the lender seeks seeks reimbursement.(d) No claim for reimbursement shall be allowed beyond the available funds in the reserve account established by the lender under section 15-3-5. After the department is satisfied that a lender has met the conditions in subsection (b) above, then to the extent that funds are available in the reserve account, the department may authorize the payment of a claim for reimbursement.[Eff. ] (Auth: HRS §§ 211D-2 and 211D-4) (Imp: HRS § 211D-4)