Massachusetts General Laws ch. 266 sec. 38A – Construction loan; misapplication
Section 38A. Whoever obtains a building or construction loan, secured by a mortgage of real estate, for the payment for labor furnished or to be furnished and/or materials used and/or employed or to be used and/or employed in the construction, repair, removal or alteration of a building or other structure which is attached or is to be attached to such real estate, and, before payment in full for all labor furnished or to be furnished and/or materials used or to be used and/or employed or to be employed as aforesaid, applies the proceeds of such loan, or any part thereof, to any use other than payment for labor and/or materials as aforesaid, shall be punished by a fine of not more than five hundred dollars or by imprisonment in jail for not more than one year, or both.
Terms Used In Massachusetts General Laws ch. 266 sec. 38A
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.