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2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 39 - Joint Accounts

Section 39. Shares and deposits may be received and held in the name of a member with one or more persons as joint tenants, payable to such member or his survivors, and any part or all of the shares or deposits and dividends or interest represented by joint accounts may be withdrawn, assigned or transferred by any of the individual parties. Payment to any of the parties to a joint account while all of them are living shall discharge the liability of the corporation to all parties and in the event of the death of any of them the corporation shall be liable only to the survivors, and the payment to any of the survivors shall discharge the liability of the corporation to all parties.
No person holding an account as a joint tenant with a member as provided herein and who is not a member or is not otherwise eligible for membership shall be deemed a member for any other provision of this chapter.
The surviving owner or owners of a joint account may maintain the balance of the account in the amount appearing at the time of the decease of a joint owner, and such credit union may allow dividend or interest additions and accumulations thereon. Such shares or deposits or any part thereof, or any interest dividends thereon, may be paid to any such person or to any assignee or pledgee of any of such persons whether the other such persons be living or not, provided they are not then attached at law or in equity in a suit against any such person and the credit union then has no notice in writing of any assignment or pledge of the account by any of such persons to any person other than the person to whom payment is being made hereunder. All such payments shall be valid. A surviving owner of a joint account may continue credit union membership if the surviving owner is eligible for membership and meets all requirements in the by-laws.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 40 - Trust Accounts

Section 40. Subject to the foregoing limitations in respect to shares and deposits and requirements relative to notice, shares may be subscribed for and deposits may be accepted in the name of one or two persons in trust for another provided the name and residence of the beneficiary is disclosed, and such shares and deposits shall be carried in the name of the shareholder or depositor as trustee or trustees. Payments may be made to the trustee, and if there are two trustees, payments may be made to both or to either or to the survivor. If no other notice of existence and terms of a trust has been received in writing by the credit union, upon the death of the trustee or if there are two trustees then upon the death of both, the amount then on deposit together with the dividends thereon may be paid to the person for whom such deposit was made or to his legal representative. Withdrawals and payments made as provided in this section shall fully discharge the liability of the credit union to all persons.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 41 - Minors' Accounts

Section 41. Shares may be issued and deposits received in the name of a minor, and such shares and deposits may, subject to the policy of the credit union, be withdrawn by such minor or by his parent or guardian and, in either case, payment made on such withdrawals shall be valid and shall release the corporation from liability to the such minor, parent or guardian relative to such shares and deposits.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 41a - Assessment of Fees and Charges

Section 41A. No credit union shall assess any fee, charge or other assessment against any account, established for personal, family or household purposes, of a depositor or shareholder who, as the payee of a check, draft or money order, of which the payee is not also the maker, deposits the same therein and payment on any such instrument is refused by the depository institution upon which it is drawn because of insufficient funds or because the maker thereof did not have an account at such depository institution; provided, however, that a credit union may assess a reasonable fee, charge or assessment that represents its direct costs, as established annually by the commissioner of banks, incurred for processing such check, draft or money order.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 42 - Deceased Depositors and Shareholders

Section 42. Deposits or shares standing in the individual name of a deceased depositor or shareholder shall, except as otherwise provided in this chapter, be paid to his legal representative; but if the total of the deposits and shares does not exceed $10,000 and there has been no demand for payment from a duly appointed executor or administrator, payment may be made at the discretion of a duly authorized officer of the corporation, after the expiration of 30 days from the death of the depositor or shareholder, to the surviving spouse of the deceased depositor or if there be no surviving spouse, to the next of kin of the deceased, upon presentation of a copy of the decedent's death certificate and the surrender of the passbook or other instrument, if any, evidencing the deposits or shares. Payments made as provided in this section shall discharge the liability of the corporation to all persons to the extent of such payments.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 46 - Lost, Stolen or Destroyed Passbooks; Application for Payment or Issuance of Duplicate

Section 46. When a passbook or other instrument as evidence of a shareholder's or a depositor's account issued by any credit union has been lost, stolen or destroyed, the person in whose name it was issued, or in the case of a joint account, by the joint owners thereof may make written application to such credit union for payment of the amount of the shares or deposit represented by said book or other instrument or for issuance of a duplicate book or other instrument therefor. The application shall include an affidavit signed and sworn to that the person making such application is a lawful owner of such passbook or other instrument, that such passbook or other instrument has been lost, stolen or destroyed, and that no lawful owner has, in any way, transferred, pledged or assigned said passbook or other instrument or any interest in the deposits or shares therein. The application shall further include an agreement, in writing, to indemnify the credit union from and against any and all claims, expenses and liabilities in any way resulting from the credit union action on the application by the payment of amounts due on said passbook or other instrument or by the issuance of a duplicate book or other instrument therefor. All signatures contained with such application shall be duly notarized. Upon receipt of such application, the credit union may pay the amount due on said passbook or other instrument or may issue a duplicate book or other instrument therefor. The provisions of this section shall apply to passbooks and other instruments issued by a credit union which subsequently has merged in, consolidated with or transferred its deposit or share liabilities to another bank or credit union.
When payment is made or a duplicate book or other instrument is issued in accordance with this section and after presentation of reasonable identification, a credit union shall not be liable to any person on account of its action on the application, payments of the amount due on said passbook or other instrument or issuance of a duplicate book or other instrument therefor, except that a credit union may be liable to a transferee, pledgee or assignee who, prior to such action, payment or issuance, has given the credit union written notice of the transfer, pledge or assignment.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 47 - Agreements Exculpating Credit Union for Wrongful Payment of Account

Section 47. Any agreement between a depositor or shareholder and any credit union which exculpates such credit union when an account, or any part thereof, is paid by such credit union to a person unlawfully presenting a passbook, or other instrument as evidence of such account is hereby declared to be contrary to public policy and void.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 48 - Proceeding for Collection of Indebtedness; Set Off

Section 48. A person indebted to a credit union may, when proceeded against for the collection of such indebtedness or for the enforcement of any security therefor, set off or recoup the amount of a deposit or shares in such credit union held and owned by him at the time of the commencement of such proceeding; provided, however, that if a proceeding in equity has been commenced to restrain the credit union from doing its actual business or if possession of such credit union has been taken over by the commissioner as provided in section twenty-two of chapter one hundred and sixty-seven or as otherwise provided by law, no shares or a deposit shall be so set off or recouped by any such person unless held and owned by him on the date of the commencement of such proceeding or of possession so taken, and the right of set off or recoupment shall be determined as of such date whether the indebtedness of the depositor or shareholder or the shares or the deposit, is then due or payable or becomes due or payable at a later date. Any indebtedness against which shares or a deposit is permitted to be set off or recouped as aforesaid may be secured or unsecured. Section three of chapter two hundred and thirty-two shall not apply to a set off hereunder, except that any party to a joint account may set off the joint deposit against his individual debt to such credit union. Notwithstanding the foregoing, a judgment shall not be rendered against such credit union in favor of the defendant for any balance found due from it if a proceeding in equity has been commenced against the credit union or possession thereof has been taken as aforesaid. The word ''deposit'', as used in this section, shall include interest due thereon and the word ''shares'', shall include dividends thereon.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 49 - Transfer of Funds to Reduce Debt; Notification

Section 49. Whenever a credit union, as a consequence of a default of a debt owed to said credit union by a depositor or shareholder, makes a transfer of funds of such depositor or shareholder to reduce or extinguish said debt, such depositor or shareholder shall be notified forthwith of such transfer by written notice sent by first class mail or electronic mail, directed to his last known address; provided, however, that if the debt is the result of consumer credit granted under the federal Truth in Lending Act, 15 U.S.C. 1601 et. seq., any required notice shall be made in compliance with the federal law and the regulations promulgated thereunder. A depositor or shareholder to whom such notice has not been sent shall be entitled to recover the amount of any actual damages.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 50 - Shares or Accounts Pledged as Security; Transfer, Assignment or Credit at Foreclosure

Section 50. In the event that any shares or accounts which are pledged as security for any loan are sold, forfeited, transferred, assigned or credited for the non-performance of the conditions of such loan or on the foreclosure thereof or for any other lawful purpose, a duly authorized officer of the corporation shall have full authority to transfer, assign or credit such shares or accounts to the bank or purchaser at any foreclosure or other sale to any assignee.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 51 - Adverse Claims to Shares or Deposits; Process; Bond

Section 51. No credit union shall be required to recognize an adverse claim to shares or a deposit standing on its books to the credit of or for the account of any person, except by virtue of the service upon it of appropriate process issued by a court of competent jurisdiction in a suit or action to which such person, or his executors or administrators, has been made a party, unless the adverse claimant gives bond satisfactory to the credit union and the adverse claimant to hold harmless and indemnify it from any liability, loss, damage, costs and expenses whatsoever on account of such adverse claim, or files with the credit union an affidavit setting forth facts showing a reasonable cause for belief that a fiduciary relationship exists between such person and said adverse claimant and that such person is about to misappropriate the deposit or shares in question.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 52 - Reduction of Accounts for Equitable Division of Loss

Section 52. The supreme judicial court or any justice thereof sitting in equity may, on petition of a credit union or the board of the credit union, approved by the commissioner, approve or order a reduction of the account of each shareholder or depositor therein whenever the value of its assets is less than the total amount of its shares and deposits so as to divide the loss equitably among such shareholders and depositors. If thereafter the credit union shall realize from such assets a greater sum than was fixed by such order of reduction, such excess shall be divided among the shareholders and depositors whose accounts have been reduced but only to the extent of such reduction; provided, however, that at any time after the entry of a decree approving or ordering such a reduction of accounts, such court or any justice thereof may, by order, finally determine the amount which such shareholders and depositors are equitably entitled to receive in full settlement of their accounts and the manner of distribution of such amount.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 53 - Disclosure to Account Holders of Availability of Funds

Section 53. For the purposes of this section, the following terms shall have the following meanings:—
''Account'', a (i) share, share certificate or share draft account of a member of a credit union or a nonmember served by a credit union serving predominantly low-income members, as defined by the board of the credit union, of a type approved by the board of the credit union that evidences money or its equivalent received or held by a credit union in the usual course of business and for which it has given or is obligated to give credit to the account of such member or such nonmember; (ii) share, share certificate or share draft account of a nonmember credit union and a nonmember unit of federal, state or local government and political subdivisions thereof; or (iii) custodial account established for loans sold in whole or in part; provided, however, that for the purposes of insured state credit unions, ''share, share certificate or share draft account'' shall include, as determined by the board of the credit union, the equivalent of such accounts under state law.
''Local originating depository institution'', any originating depository institution located in the commonwealth.
Each credit union shall disclose to account holders its policy relative to the time period between the deposit of funds by means of a check, negotiable order of withdrawal or money order and the availability of such deposit for withdrawal or use as of right.
Except as provided herein, such disclosure and relative availability requirements shall be in accordance with the provisions of the Expedited Funds Availability Act, 12 USC 4001 et seq. and regulations promulgated thereunder.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 57 - Loans to Members; Applications; Preferences; Limitations

Section 57. The capital, deposits and surplus of a credit union shall be invested in loans to members, with approval of the credit committee, as provided in section seventeen and, when so required herein, of the board of directors.
All applications for loans shall be made in writing or by electronic means.
Personal loans shall always be given the preference and, in the event there are not sufficient funds available to satisfy all loan applications approved by the credit committee, preference shall be given to the smaller loan.
Whenever the liquidity reserve required by section seventy-one falls below five percent of the total assets of a credit union, no further loans shall be made until the ratio as herein provided has been reestablished.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 58 - Liabilities of Members; Limitations

Section 58. The total liabilities to a credit union of a member for money borrowed under this chapter shall not at any one time exceed twenty percent of the sum of loan reserve, investment reserve, undivided earnings and any other surplus accounts of such credit union or ten thousand dollars, whichever is greater, plus an amount equal to said member's shares and deposits, if any, pledged to secure an obligation.
The total liabilities to any credit union of an organization member and the total liabilities of more than one such member, the majority interest of which is owned or controlled, directly or indirectly, by the same person or persons, fraternal organizations, voluntary associations, partnerships or corporations, for money borrowed pursuant to the provisions of section sixty-five, including in the liabilities of a partnership or company not incorporated the liabilities of the several members thereof, shall not at any one time exceed the total liability of a shareholder or depositor as authorized by said section sixty-five.
In computing the total liability of a member hereunder, there shall be included the direct liability of the member and his liability as endorser, guarantor or surety on the obligation of others which are held by the credit union; provided, however, there shall be excluded from such computation the amount of any mortgage loan secured by a first lien on real estate improved with a dwelling to be occupied by not more than four families and occupied or to be occupied, in whole or in part, by such member.
The members at each annual meeting shall fix the maximum amount to be loaned to any one member.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 63 - Education Loans

Section 63. A credit union may make loans to aid and assist students to fulfill a program of higher education as provided herein.
Any student who has not attained the age of eighteen and has been admitted to an institution of higher learning or attends such an institution shall have full legal capacity to act in his own behalf in the matter of contracts and other transactions with respect to financing his education under any federal, state or private financing plan, and with respect to such acts done by any such student, he shall have the rights, powers and privileges and be subject to the obligations of persons of full age.
A credit union may make loans to aid and assist students to fulfill a program of higher education if such loans are guaranteed in whole or in part by the Massachusetts Higher Education Assistance Corporation as follows:
1. A student shall be eligible for a loan in a credit union if a member of his family is a member of the credit union.
2. The provisions of section fifty-nine shall not be applicable to loans made under this section.
Subject to such regulations as the commissioner may deem necessary, a credit union may make and acquire such loans and advances of credit to qualified students as are insured by the federal commissioner of education under Part B of Title IV of the Higher Education Act of 1965 (Public Law 89–329), and may obtain and receive such insurance, commitments for such loans, lines of credit and certificates of individual or comprehensive insurance coverage for such loans, as are provided by said act and may pay the premiums for such insurance fixed by the federal commissioner of education pursuant to said act and may receive payments of interest and principal on such loans pursuant to said act and regulations made thereunder.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 65 - Definitions Applicable to Secs. 65 to 65e

Section 65. As used in sections 65 to 65E, inclusive, the following words shall, unless the context otherwise requires, have the following meanings:—
''Commissioner'', the commissioner of banks.
''Loan'', a loan or line of credit, whether secured by collateral or security of any nature or unsecured, for consumer or other purposes other than a real estate loan.
''Real estate'', land or property, including improved land with a dwelling, owner occupied or unoccupied dwellings, unimproved land, farmland, a unit of a condominium, shares of stock issued by a co-operative housing corporation, leasehold interests under a lease which does not expire for at least 5 years beyond the maturity date of the loan, leasehold interests created in air rights over land, and any other interest in land.
''Mortgage loan'', a loan, line of credit, or borrowing secured primarily by a lien on an interest in real estate, with the exception of a loan described in subsection (c) of section 65A.
''Non-recourse reverse mortgage loan'', a reverse mortgage loan which limits the lender's recovery solely to the value of the property at the time the loan becomes due and payable.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 65a1/2 - Mortgage Loans Participation

Section 65A1/2. (a) A credit union may make, acquire, buy or sell, in whole or in part, mortgage loans on property located in the commonwealth, Connecticut, Maine, New Hampshire, New York, Rhode Island or Vermont as participation loans with a bank, credit union service organization, federally-chartered or federally-insured credit union or financial institution, insurance company or any state or federal government agency or a subdivision thereof.
(b) For any mortgage loan participation in which the credit union is originating the loan to the borrower, the borrower shall be a member of the credit union and the loan shall be made in accordance with this chapter.
(c) A credit union may enter into a mortgage loan participation on a loan originated by a bank, credit union service organization, federally-chartered or federally-insured credit union or financial institution, insurance company or any state or federal government agency or a subdivision thereof and issued to a borrower; provided, however, that the loan is a type of loan that the participating credit union may make under the participating credit union's board-approved policies. Section 66 shall not apply to loans under this subsection.
(d) A credit union may service any mortgage loan participation.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 65b - Inspection of Real Estate Securing Loan Upon Default; Appraisal of Real Estate Upon Excessive Loan

Section 65B. (a) A credit union shall inspect the real estate securing a loan in the event that a payment of interest or principal upon the loan or on account of real estate taxes upon the parcel mortgaged to secure the same shall be in default. Inspection for the purpose aforesaid shall be made within 91 days from the date of such default in payment of interest or principal or within 181 days from the date of such default in payment on account of taxes, as the case may be, and thereafter periodic inspection shall continue in accordance with this section until such loan shall no longer be in default.
(b) The commissioner may cause an appraisal of real estate to be made at the expense of the credit union whenever the commissioner deems an excessive loan has been made or is about to be made upon real estate.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 65c1/2 - Reverse Mortgage Loan Requirements

Section 65C1/2. (a) As used in this section the following word shall, unless the context clearly requires otherwise, have the following meaning:
''Mortgagor'', an applicant for a reverse mortgage who: (1) has a gross income of less than 50 per cent of the area median income, as periodically determined by the United States Department of Housing and Urban Development; and (2) possesses assets, excluding a primary residence, valued at less than $120,000.
(b) No mortgagee shall make a reverse mortgage loan pursuant to section 65C to a mortgagor unless: (i) the mortgagor affirmatively opts in writing for the reverse mortgage; and (ii) at or before the closing of any reverse mortgage loan the mortgagee has received written certification from a counselor with a third-party organization that the mortgagor has received counseling in person relative to the appropriateness of the loan transaction from the third party organization and has completed an approved counseling program offered by the third party organization; provided, however, that the third party organization shall have been approved by the executive office of elder affairs for purposes of such counseling.
(c) A reverse mortgage executed with a borrower that has not received counseling by a third party approved by the executive office of elder affairs shall render the terms of the reverse mortgage unenforceable. The commissioner shall adopt regulations to administer and implement this section.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 65d - Mortgage Loans Which Provide for Variation in Interest Rate; Conditions; Variation in Rate of Amortization

Section 65D. (a) Any credit union may make or acquire mortgage loans evidenced by a note which provides for variation in the rate of interest over the term of the note, but a loan made to finance or refinance the purchase of and secured by a first lien on a dwelling house of 4 or fewer separate households, occupied in whole or in part by the mortgagor, shall be subject to, but not limited to, the following conditions and restrictions imposed by the commissioner:—
(1) the method by which the rate of interest may be adjusted;
(2) the frequency with which the rate of interest may be adjusted, but that successive rate adjustments shall be not less than 6 months apart;
(3) the maximum increase in the rate of interest allowed for any such adjustment;
(4) provisions for decreases in the rate of interest as may be warranted by market conditions;
(5) requirements for advance notification and explanation of adjustments in the rate of interest, but the notification and explanation shall occur not less than 30 days before the adjustment; and
(6) methods of disclosure to the mortgagor of the terms and conditions of the loan as required under the provisions of chapter 140D.
(b) Notwithstanding any general or special law to the contrary, the commissioner may, by further conditions and restrictions, provide that the rate of amortization may be varied, including utilizing a period of negative amortization, in order to adjust the rate of interest.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 65e - Powers of Credit Unions

Section 65E. A credit union shall have the following powers and any further incidental or complementary powers that may fairly be implied from those expressly conferred and such as are reasonably necessary to enable the credit union to exercise fully those powers according to common customs and usages:
(i) to discount, buy, invest in, hold, assign, transfer, sell and negotiate promissory notes, drafts, bills of exchange, mortgages, bonds, debentures, bonds or notes secured by mortgages, installment obligations and other evidences of debt;
(ii) to advance money or credits on real estate, on improvements thereto or on personal security, on terms to be agreed upon; and
(iii) to buy, sell or make loans as participation loans with any other federally-insured credit union, bank or insurance company and to service any loans sold by it.
This section shall be applicable to loans and mortgage loans authorized by sections 65A to 65E, inclusive.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 66 - Person Obligated to Make Payments Under Mortgage to Be Member of Credit Union

Section 66. Prior to making mortgage loans on real estate pursuant to sections 65 to 65E, inclusive, a credit union shall require a person obligated from time to time to make payments under a mortgage, whether as the original borrower or as a subsequent owner of a mortgaged property, to be or become a member of the credit union.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 67a - Membership in Associations Benefitting Credit Union or Providing Services

Section 67A. A credit union may, by vote of its board of directors, obtain membership in certain organizations and may make contributions and subscribe for services subject to the conditions and requirements of this section.
(1) A credit union may become a member of any association organized to protect and promote the interest of credit unions and may pay for such membership its proportionate share of expenses as is reasonable and necessary.
(2) A credit union may become a member of or contribute to any other association or organization in the commonwealth if, in the opinion of its board of directors, such membership or contribution is reasonable and of substantial benefit to such credit union and its members.
(3) For the purpose of promoting, protecting or conserving the assets of credit unions, a credit union may subscribe for services, including advertising and professional services, rendered or to be rendered collectively through an association referred to in paragraph (1) or through any group of credit union institutions; and in each such case, the credit union, with the approval of its board of directors, may pay for such services its proportionate share of the total cost thereof or such other amount as the said board shall deem reasonable and proper.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 68 - Registration of Securities in Name of Partnership or Corporate Nominee

Section 68. Any credit union may cause any stock or security in registered form held for its account and not in a fiduciary capacity to be registered and held in the name of a partnership or corporate nominee named by it and residing or having a principal place of business in the commonwealth; provided, however, that nothing in this section shall be construed as to permit any credit union to deliver any security held for its account into the possession and control of any other person except in accordance with the regulations of the commissioner pursuant to section six of chapter one hundred and sixty-seven. A depository having possession of securities of a credit union registered as authorized by this section shall maintain adequate records indicating the ownership thereof, shall segregate the same from his or its own assets and shall be absolutely liable for any loss occasioned by the acts of a nominee.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 69 - Allowance or Reserve for Loan Losses

Section 69. A credit union shall maintain an allowance for loan losses or reserve for loan losses calculated according to generally accepted accounting principles or as otherwise directed by the commissioner. For the purposes of this chapter, any reference to the term ''loan reserve'' shall mean the allowance for loan losses or the reserve calculated under this section.
Should the reserves maintained in this section and section seventy exceed the amount necessary to be kept or maintained in those accounts, the credit union may transfer such excess into an undivided earnings account.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 70 - Reserve for Losses on Investments

Section 70. A credit union shall maintain a reserve for loses on investments equal to five percent of the difference between the book value and the market value of all investments mentioned in section sixty-seven excluding those investments which are included in the liquidity reserve; provided, however, that a credit union shall maintain a reserve for the stock investments authorized by paragraph (o) and the investment funds authorized by paragraph (p) of section sixty-seven.
Should the reserves maintained in this section and section sixty-nine exceed the amount necessary to be kept or maintained in those accounts, the credit union may transfer such excess into an undivided earnings account.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 71 - Cash on Hand Requirements and Enumerated Investments

Section 71. At least five percent of the total assets of a credit union shall be carried as cash on hand or in the following investments which shall be the absolute property and shall be under the control of the credit union or be held by book entry procedure when required. Whenever the aforesaid ratio falls below five percent of the total assets of a credit union, no further loans shall be made until the ratio as herein provided has been reestablished.
(a) Shares in the Central Credit Union Fund, Inc.
(b) Shares in a federally chartered corporate credit union.
(c) Deposits in savings banks incorporated in the commonwealth.
(d) Paid-up shares and accounts of and in cooperative banks incorporated in the commonwealth.
(e) Shares of savings and loan associations incorporated in the commonwealth.
(f) Balances due from banks and trust companies or banking companies which are members of the Federal Deposit Insurance Corporation.
(g) Shares of federal savings and loan associations having a usual place of business within the commonwealth.
(h) Bonds or notes of the United States or of any state or subdivision thereof with a maturity of up to five years.
(i) Bonds or notes of other federal agencies which are on the list of legal investments prepared pursuant to section fifteen A of chapter one hundred and sixty-seven with a maturity of up to three years.
(j) Repurchase agreements secured by United States government obligations up to one year maturity.
(k) In a common trust unit plan organized for the purchase of bonds or notes of the United States or of any subdivision thereof which are on the list of legal investments prepared pursuant to said section fifteen A of said chapter one hundred and sixty-seven and which has as its custodian a banking institution authorized to accept deposits from a credit union or from a savings bank.
(l) Securities of the government national mortgage association.
(m) Federal funds.
(n) In any bonds or notes which are on the list of legal investments prepared pursuant to said section fifteen A of said chapter one hundred and sixty-seven with a maturity of up to three years; provided, however, that such bonds or notes are rated as, A, AA, or AAA.
(o) Certificates of deposits of up to one year maturity which otherwise meet the criteria set out in paragraphs (a) to (i), inclusive, or paragraph (q) of section sixty-seven.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 72 - Contingent Fund; Liability on Loan Upon Death of Member

Section 72. The by-laws of a credit union may provide that upon the death of a member who is a borrower by means of a personal loan upon his note, whether or not there are any endorsers or co-makers thereon, but otherwise unsecured, the liability upon such loan shall cease with respect to the unpaid balance of such loan and any loss thereon may be charged to a contingent fund, which fund shall be created and thereafter maintained by such credit union by contributions from undivided earnings, current earnings or from the borrowers, as determined by the board of directors; provided, however, that the operation of such a provision of the by-laws shall not, in any calendar year, result in charges to the contingent fund in excess of ten percent of the loan reserve, investment reserve, undivided earnings and other surplus accounts in addition to the unexpended balance of contributions by borrowers. Each such charge to the contingent fund shall be reported within ten days thereafter to the commissioner, who may make such orders regarding the operation of the contingent fund as he deems advisable.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 73 - Borrowing on Behalf of Credit Union

Section 73. The board of directors may borrow money for and on behalf of the credit union.
The board may, if the credit union has a deposit or share account, borrow money for and on behalf of the credit union from a savings bank, cooperative bank, federal savings and loan association, national bank or trust company, an entity identified by the commissioner or any federally-insured corporate credit union; provided, however, that money borrowed from any such institution shall be in an amount not more than the deposit or share account and shall extend not more than 1 year from the date on which the loan is made.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 74 - Sale, Transfer and Assignment of Loans, Investments and Other Assets

Section 74. A credit union by a vote of its directors may sell, transfer and assign any and all of its loans, investments or other assets; provided, however, that (a) where loans are sold with recourse, a loan reserve shall be established consistent with the applicable provisions of section sixty-nine and appropriate explanations shall be recorded on the statement of conditions as the commissioner may prescribe; (b) in any case where the consideration to be received is other than cash, the written approval of the commissioner shall first be obtained; and (c) where the aggregate amount of sales of loans exceeds 20 per cent of the total loans outstanding, the prior written approval of the commissioner shall be obtained for any amount in excess thereof.
A credit union may continue to service any loans that it sells and may collect a service charge for such service provided that a formal agreement is effected between both parties.
Any such assignment given as security for borrowing shall constitute a debt which shall be satisfied in the event of the liquidation of the affairs of a credit union before any distribution of its assets to shareholders or holders of other accounts.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 75a - Credit Union as Agent or Broker for the Savings Bank Life Insurance Company of Massachusetts

Section 75A. A credit union may, with the approval of the commissioner, act as agent or broker for The Savings Bank Life Insurance Company of Massachusetts pursuant to section four of chapter one hundred and seventy-eight A.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 76 - National Credit Union Administration Central Liquidity Facility; Membership

Section 76. A credit union may, with the approval of the commissioner, become a regular member of the National Credit Union Administration Central Liquidity Facility, established by 12 USC 1795b and may invest in the shares of the National Credit Union Administration Central Liquidity Facility; provided, however, that such investment shall not exceed the amount necessary to become a member of such facility.
A credit union may become a member of any corporate credit union which has been approved to act as an agent of the National Credit Union Administration Central Liquidity Facility.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 77 - Massachusetts Credit Union Share Insurance Corporation; Insurance of Shares and Deposits

Section 77. A credit union may arrange to have its shares and deposits insured by the Massachusetts Credit Union Share Insurance Corporation. A credit union may arrange with the National Credit Union Administration for the insurance of its shares and deposits pursuant to the Federal Credit Union Act, as amended.
Any credit union which shall apply to said Administration for insurance shall forthwith give written notice of such application to the commissioner. If such application is accepted and such credit union is notified that the Administration is willing to provide such insurance, such credit union may become insured by said Administration; provided, however, that the acquisition of such insurance shall have been approved by the directors of the credit union.
When any credit union which has applied for insurance to said Administration shall have complied with all the requirements prerequisite to obtaining such insurance and shall have received notice in writing from said Administration that it is insured by it, such credit union shall file with the commissioner copies of such notice and of the vote of its directors required by this section such copies to be certified by the president and clerk of the credit union.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 78a - Merger or Consolidation of Credit Unions With Savings Bank, Co-Operative Bank or Subsidiary Banking Institution

Section 78A. Any 1 or more credit unions may merge or consolidate with 1 or more savings banks, as defined in section 1 of chapter 168, or 1 or more co-operative banks, as defined in section 1 of chapter 170, or 1 or more subsidiary banking institutions, as defined in section 1 of chapter 167H and section 4 of chapter 167I.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 79 - Merger of Credit Unions Under Possession of Commissioner or Massachusetts Share Insurance Corporation

Section 79. If the commissioner has taken possession of a credit union as provided for in sections 22 to 26, inclusive, of chapter 167 or a credit union is in the possession of the Massachusetts Share Insurance Corporation and it is determined by the commissioner and the insurer that it is in the best interests of the depositors, shareholders and insurer, a merger as provided for in section 78 may be effected without regard to geographical limitations within the commonwealth.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 80 - Foreign Credit Unions; Consent for Incorporation

Section 80. Any credit union operating under a charter other than one issued by the commonwealth and having a usual place of business therein may, if authorized by a vote of at least a majority of its members present and voting at a meeting specially called for that purpose, make application to the commissioner for consent for incorporation under this chapter. Said commissioner may grant his consent to such incorporation when satisfied that the assets of such credit union qualify for investment by a credit union incorporated under this chapter. If any of the assets of the applicant credit union do not qualify as legal investments for a credit union incorporated under this chapter, such consent may nevertheless be given, subject to such terms with respect to the time in which the same shall be disposed of or converted into legal assets as the commissioner may impose. Upon the issuing by the state secretary of the certificate of incorporation, all of the assets of the applicant credit union shall be transferred to and vested in the credit union so incorporated, to the same extent as would result from a merger of the applicant credit union and the new credit union under section seventy-eight. The newly incorporated credit union shall thereupon issue its shares, in the same amount and to the same persons, in satisfaction of the shares of the applicant credit union, and assume the deposit and other liabilities thereof. Thereupon the charter of the applicant credit union shall be surrendered to the issuing authority for cancellation by it and the new credit union shall be operated under and governed by this chapter.
2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXII - Corporations › Chapter 171 - Credit Unions › Section 83 - Credit Union Employees Retirement Association; By-Laws; Reports

Section 83. The by-laws of the association shall be submitted to the commissioner and shall prescribe the manner in which, and the officers and agents by whom, the association may be conducted and the manner in which its funds may be invested and paid out. The association shall be formed when its by-laws have been approved and agreed to by a majority of the directors of each of 15 or more credit unions and have been approved by the commissioner. The association shall provide to the commissioner such statements of the membership and financial transactions of the association as the commissioner may from time-to-time require. The commissioner may verify any such statement by an examination of the books and papers of the association.
The association shall not be subject to chapter 32 or chapter 175 or to such other provisions of law related to insurance companies or other retirement associations.