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A03283 Summary:

COSPNSRBarclay, Ra
MLTSPNSRCrouch, Giglio, McDonough, Raia, Thiele
Amd 2404, add 2405-g, Pub Auth L
Authorizes the establishment of the home equity protection insurance program directing the agency to issue a commitment to insure and insure the full value of certain residences which are owner-occupied by persons who meet certain income qualifications.
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A03283 Text:

                STATE OF NEW YORK
                               2017-2018 Regular Sessions
                   IN ASSEMBLY
                                    January 27, 2017
        Introduced by M. of A. FITZPATRICK, BARCLAY, RA -- Multi-Sponsored by --
          M.  of  A.   CROUCH, GIGLIO, McDONOUGH, RAIA, SALADINO, THIELE -- read
          once and referred to the Committee on Housing
        AN ACT to amend the public authorities law, in relation to  establishing
          a home equity protection insurance program

          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
     1    Section 1. Subdivision 33 of section 2404 of  the  public  authorities
     2  law,  as  renumbered  by  chapter  72 of the laws of 2016, is renumbered
     3  subdivision 34 and a new subdivision 33 is added to read as follows:
     4    (33) To establish and administer a home  equity  protection  insurance
     5  program  in  accordance  with section twenty-four hundred five-g of this
     6  part.
     7    § 2. The public authorities law is amended by  adding  a  new  section
     8  2405-g to read as follows:
     9    §  2405-g. Home equity protection insurance program. (1) The agency is
    10  hereby directed, to the extent it finds practicable, to establish a home
    11  equity protection insurance program whereby it will issue  a  commitment
    12  to  insure  and insure the full value of a one-to-four family residence,
    13  including a condominium and a cooperative, that is owner-occupied by any
    14  person or persons who meet  the  income  qualifications  for  a  forward
    15  commitment  mortgage  pursuant  to section twenty-four hundred five-b of
    16  this part. The full value of the  residential  real  property  shall  be
    17  determined  by  either  its  purchase price, the purchase price plus the
    18  cost of any rehabilitation to the residence, or an appraisal. The insur-
    19  ance shall be issued by the agency after the purchase or  the  rehabili-
    20  tation  of  the  real property upon payment of a premium that the agency
    21  shall determine.
    22    (2) Upon the sale of the residential real property that is insured  by
    23  the  agency  through its home equity insurance program, the agency shall
    24  pay the policy holder/owner the difference between the face value of the
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.

        A. 3283                             2
     1  insurance policy and the sales price of the  insured  premises  if  such
     2  sales  price  is  less  than  the  insured  amount  and  if  the  policy
     3  holder/owner has lived in the premises for a period  of  not  less  than
     4  three  years.  The agency shall establish procedures to be followed by a
     5  policy holder/owner in the event of a payment under  the  terms  of  any
     6  home  equity  protection  insurance  policy.  The  agency  shall  not be
     7  required to pay on a claim for a loss of equity if  it  determines  that
     8  such  loss occurred predominantly from the policy holder/owner's neglect
     9  of the real property's physical condition.
    10    (3)(a) The agency shall create a home equity protection insurance fund
    11  to be used as a revolving fund for carrying out the provisions  of  this
    12  section  with  respect  to residential real property insured thereunder.
    13  The agency shall pay into such fund all moneys which may be available to
    14  the agency for the purposes of such fund from any source, including  but
    15  not  limited to the moneys received from premiums derived from the issu-
    16  ance of home equity protection insurance policies.
    17    (b) The agency shall maintain  in  the  equity  insurance  fund  as  a
    18  reserve  an  amount  of  money or cash equivalents equal to no less than
    19  twenty percent of the amounts insured under  the  agency's  home  equity
    20  protection insurance contracts.
    21    (4)  Moneys  in  such fund may be invested (a) in special time deposit
    22  accounts in, or certificates of deposit issued by, a bank, trust  compa-
    23  ny,  savings bank or savings and loan association located and authorized
    24  to do business in this state; provided, however, that such time  deposit
    25  account  or  certificate of deposit shall be payable within such time as
    26  the proceeds may be needed to meet expenditures estimated to be incurred
    27  by the agency and provided further that such  time  deposit  account  or
    28  certificate  of  deposit  be  secured  by a pledge of obligations of the
    29  United States of America or obligations of the state, any  city  of  the
    30  state,  or  other  municipal  corporation,  school  district or district
    31  corporation of the state or  obligations  of  agencies  of  the  federal
    32  government; or (b) in obligations of the United States of America or the
    33  state  which may from time to time be legally purchased by savings banks
    34  within the state as an investment of funds belonging to them or in their
    35  control, or in obligations of the Federal National Mortgage  Association
    36  provided  such  obligations shall be payable or redeemable at the option
    37  of the owner within such times as the proceeds may  be  needed  to  meet
    38  expenditures estimated to be incurred by the agency.
    39    § 3. This act shall take effect on the one hundred eightieth day after
    40  it shall have become a law.
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