(a) The financial institution that holds a loan guaranteed by the authority under AS 44.88.500 — 44.88.599 shall (1) service the loan;
(2) exercise diligence in collecting amounts due under the loan; and
(3) comply with all requirements of the loan guarantee agreement.
(b) Amounts received toward satisfaction of a default on a loan guaranteed under AS 44.88.500 — 44.88.599 shall be allocated between the lender and the fund according to the guaranteed percentage of the loan until the principal balance and accrued interest have been repaid.