Connecticut General Statutes Title 8. Zoning, Planning, Housing and Economic and Community Development § 8-265ww. Claims by eligible financial institutions. Assignment of guaranteed loans to state. Recordkeeping. Termination of loan guarantees. Maximum amount of claims

(a) An eligible financial institution that has made a good faith effort to collect the outstanding principal from a loan issued pursuant to section 8-265vv may make a claim to the authority for recovery of an amount equal to the outstanding principal for such loan. Except as provided in subsection (d) of this section, if the eligible financial institution demonstrates to the satisfaction of the authority that the eligible financial institution has made a good faith effort to collect the outstanding principal from the eligible borrower in accordance with the financial institution's loan servicing and collection policies, the authority shall process and submit the claim to the Comptroller for payment. Upon payment of a claim by the Comptroller, and as a condition of such payment, (1) the loan shall be assigned to the state, and (2) the authority, as agent for the state, shall have the right to continue collection efforts on the loan. Any amount necessary for payment by the Comptroller to honor loan guarantees under this section shall be deemed appropriated from the General Fund, and any funds collected by the authority in accordance with this subsection shall be deposited to the General Fund.

(b) The authority shall maintain records in the regular course of administration of the loan guarantee program, including a record of loans issued and of payments made to honor loan guarantees issued under this section.

(c) The authority may terminate any loan guarantee if the financial institution misrepresents any information pertaining to the guarantee or fails to comply with any requirements of this section in connection with the guarantee of the underlying loan.

(d) The total amount of claims processed by the authority and paid by the Comptroller to honor loan guarantees under this section shall not exceed two million dollars. When the total amount of claims processed by the authority and paid by the Comptroller reaches two million dollars, the authority shall immediately cease to process claims and shall notify the Comptroller and each eligible financial institution participating in the program that the authority has ceased honoring loan guarantees.