Investment of funds
Sec. 13. Every guardian shall invest the surplus funds of the estate
of the protected person, in which investment the guardian has no
interest, and only as provided in this section:
(1) In bonds or notes constituting the direct and general
obligations of the United States, or of a state that has not at any
time during the ten (10) years next preceding the date of the
investment defaulted in payment of the principal or interest on
any bonds or notes by it issued, or in bonds, the payment of
which, both principal and interest, is guaranteed by the United
States.
(2) In bonds or notes that are the direct and general legal
obligations of a county, city, or town in this state, and which
also at the date of the investment has the power to levy general
taxes sufficient for the payment of principal and interest on the
obligations, if the issuer of the obligation has not defaulted in
payment of principal or interest due upon any of its bonds or
notes at any time during the ten (10) years next preceding the
date of the investment.
(3) After prior order of the court, upon application, in the
legally issued notes or bonds of the owner of improved
unencumbered real property in this state, secured by first
mortgage or deed of trust. The total debt secured by the
encumbrance may not exceed fifty percent (50%) of the cash
market value of the real property at the time of the investment,
and, if buildings or other improvements constitute a material
part of the value of the premises encumbered to secure the
indebtedness, they shall be kept insured against loss or damage
by fire, in a reasonable amount for the benefit of the owners of
the notes or bonds. Before making any investment, a signed
application shall be procured from the borrower, that shall
contain the information required by the lender, and that shall
contain a complete description of the real estate, including
improvements and an affirmative statement that the proposed
borrower is the owner of the entire fee simple title to the real
estate and improvements, that they are free of every
encumbrance or lien of any character, or if not, a statement of
any existing encumbrance or other liens, and specific
authorization to the lender to withhold from the proposed loan
the necessary sum to discharge and procure the release of any
encumbrances or other liens. The release shall be procured and
filed for record prior to or contemporaneously with the making
of the loan. The proposed borrower shall also furnish with the
application an abstract or certificate of title, which shall be
completed to the time of closing the loan. The guardian
proposing to make a loan or purchase any notes or bonds shall
exhibit to the court with the application for approval the opinion
of a qualified attorney at law, satisfactory to the court, which
opinion shall show that the attorney has examined the title or
certificate of title and that it is the opinion of the attorney that
the proposed borrower has good title to the property to be
encumbered, and that the proposed encumbrance will constitute
a first lien on the property. In addition, the guardian shall file
with the court satisfactory written evidence that the cash market
value of the property to be encumbered is in accordance with
the requirements of this subsection. If the guardian purchases
notes or bonds previously issued, the attorney's examination and
opinion shall also disclose whether the proposed transferor has
and will pass to the guardian good title together with the liens
securing the notes or bonds. Except loans insured by the federal
housing administrator, the guardian is not authorized to loan or
invest money upon the security of a real estate mortgage or trust
deed which secures any principal indebtedness other than to the
protected person's estate, and in the case of a minor the maturity
of any indebtedness to the minor secured by real estate
mortgage or trust deed shall not be later than the date on which
the minor will attain the age of majority. Any investment made
by a guardian in any of the securities enumerated shall not be
transferred, liquidated, or disposed of, except upon petition
filed for that purpose and an order of court obtained.
(4) In shares of a federal savings and loan association organized
under the Home Owners' Loan Act of 1933, (12 U.S.C. 1461
through 1468), as in effect on December 31, 1990, or any
building or savings and loan association whose principal place
of business is located in Indiana whose accounts are insured by
the Federal Deposit Insurance Corporation as provided in 12
U.S.C. 1811 through 1833e, as in effect on December 31, 1990.
No shares may be purchased in excess of the amount of
insurance protection afforded a member or investor of any such
institution.
(5) In savings deposits in any bank whose principal place of
business is located in Indiana.
(Formerly: Acts 1953, c.112, s.2013; Acts 1957, c.223, s.1.) As
amended by Acts 1982, P.L.1, SEC.53; P.L.33-1989, SEC.48;
P.L.8-1991, SEC.32.
Last modified: May 27, 2006