Opinion ID: 1824073
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Heading: Construction Mortgage Lien.

Text: A construction mortgage lien extends to secure loans or advancements made to directly finance work or improvements upon the real estate which secures the lien. Iowa Code § 572.18. Des Moines Lumber urges the term directly is unambiguous and must be accorded some meaning and effect. It is urged the money advanced by Midland must be paid directly to the providers or suppliers of the work or improvement to qualify as a construction mortgage lien. In contrast, Midland urges the term directly must not be construed in isolation because it is an adjective modifying the word finance, Midland claims money paid to Stewart for the purpose of providing funds to carry out the development project satisfied the statutory requirement. We agree with Midland. If the intent of the legislature was to require the lender to directly pay the mechanics, it could have so stated. Generally, a construction loan mortgagee has no duty to insure that the borrower pays contractors and materialmen. See General Mortgage Corp. v. Campbell, 258 Iowa 143, 153, 138 N.W.2d 416, 421 (1965). The term directly can be understood as a contrast to indirect. A loan or advancement of general credit furnished by a borrower would not constitute a direct financing of a construction project. On the other hand, if the loan or advancement is specifically made to pay costs of a specific improvement or project then the mortgage secures a loan or advancement made to directly finance the work and has the protection of a construction mortgage lien. We affirm the district court's rulings as modified. We remand for judgment in accordance with this opinion. AFFIRMED AS MODIFIED AND REMANDED.