Rpld & add §6-p, Bank L; amd §354-f, Exec L; amd §29-a, Veterans' Services L (as proposed in S.8670-A &
A.9493-A)
Provides that a veteran seeking a housing loan under chapter 37 of title 38 of the United States Code be offered loan counseling services by a counselor certified by the United States department of housing and urban development under Part 214 of Title 24 of the Code of Federal Regulations prior to the processing of such application by a banking institution or mortgage lender and that the department of veterans' services shall promulgate regulations to ensure that no conflicts of interest exist between counselors and mortgage companies.
STATE OF NEW YORK
________________________________________________________________________
633
2023-2024 Regular Sessions
IN ASSEMBLY
January 10, 2023
___________
Introduced by M. of A. STERN -- read once and referred to the Committee
on Banks
AN ACT to amend the banking law, the executive law and the veterans'
services law, in relation to certain notices and services upon appli-
cation for a mortgage guaranteed under the "Servicemen's Readjustment
Act of 1944"; and providing for the repeal of certain provisions upon
expiration thereof
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 6-p of the banking law, as added by a chapter of
2 the laws of 2022 amending the banking law, the executive law and the
3 veterans' services law relating to certain notices and services upon
4 application for a mortgage guaranteed under the "Servicemen's Readjust-
5 ment Act of 1944", as proposed in legislative bills numbers S. 8670-A
6 and A. 9493-A, is REPEALED and a new section 6-p is added to read as
7 follows:
8 § 6-p. Loan counseling for mortgages guaranteed by the Servicemen's
9 Readjustment Act of 1944. Every mortgage lending institution and mort-
10 gage banker which originates loans secured by real property used for
11 residential purposes located in this state which are to be guaranteed
12 under the Servicemen's Readjustment Act of 1944 shall provide a separate
13 disclosure form with each application stating that a veteran seeking a
14 housing loan under chapter 37 of title 38 of the United States Code has
15 been offered loan counseling services. Such loan counseling services
16 shall be provided by the department of veterans' services under section
17 twenty-nine-a of the veterans' services law upon request of an appli-
18 cant. The disclosure form required by this section shall be signed by
19 each applicant and shall include information detailing how to access
20 such counseling services.
21 § 2. Section 354-f of the executive law, as added by a chapter of the
22 laws of 2022 amending the banking law, the executive law and the veter-
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD04151-01-3
A. 633 2
1 ans' services law relating to certain notices and services upon applica-
2 tion for a mortgage guaranteed under the "Servicemen's Readjustment Act
3 of 1944", as proposed in legislative bills numbers S. 8670-A and A.
4 9493-A, is amended to read as follows:
5 § 354-f. Loan counseling for mortgages guaranteed by the Servicemen's
6 Readjustment Act of 1944. Upon the request of any veteran, the division
7 shall provide counseling and assistance to applicants for a mortgage
8 loan guaranteed by the Servicemen's Readjustment Act of 1944. Such
9 service shall be provided either directly or through a contract with a
10 not-for-profit entity which has a Commercial and Government Entity
11 (CAGE) code assigned by the federal System for Award Management and
12 which is not owned by, affiliated with or operated by a mortgage compa-
13 ny. Counselors shall be [licensed in this state as either a real estate
14 broker or a mortgage broker] certified by the United States department
15 of housing and urban development under Part 214 of Title 24 of the Code
16 of Federal Regulations. Loan counseling and assistance shall include a
17 review of the terms and restrictions of the loan[, information deter-
18 mined by the state director to be appropriate for a veteran seeking a
19 housing loan under chapter 37 of title 38 of the United States Code,]
20 and any other information which may be required under federal law, rule
21 or regulation. The division may promulgate regulations necessary to
22 prevent any potential conflicts of interest between counselors and mort-
23 gage companies to ensure that any counseling and assistance provided
24 under the provisions of this section shall be made in the best interest
25 of the veteran seeking such mortgage loan.
26 § 3. Section 29-a of the veterans' services law, as added by a chapter
27 of the laws of 2022 amending the banking law, the executive law and the
28 veterans' services law relating to certain notices and services upon
29 application for a mortgage guaranteed under the "Servicemen's Readjust-
30 ment Act of 1944", as proposed in legislative bills numbers S. 8670-A
31 and A. 9493-A, is amended to read as follows:
32 § 29-a. Loan counseling for mortgages guaranteed by the Servicemen's
33 Readjustment Act of 1944. Upon the request of any veteran, the [divi-
34 sion] department shall provide counseling and assistance to applicants
35 for a mortgage loan guaranteed by the Servicemen's Readjustment Act of
36 1944. Such service shall be provided either directly or through a
37 contract with a not-for-profit entity which has a Commercial and Govern-
38 ment Entity (CAGE) code assigned by the federal System for Award Manage-
39 ment and which is not owned by, affiliated with or operated by a mort-
40 gage company. Counselors shall be [licensed in this state as either a
41 real estate broker or a mortgage broker] certified by the United States
42 department of housing and urban development under Part 214 of Title 24
43 of the Code of Federal Regulations. Loan counseling and assistance shall
44 include a review of the terms and restrictions of the loan[, information
45 determined by the state director to be appropriate for a veteran seeking
46 a housing loan under chapter 37 of title 38 of the United States Code,]
47 and any other information which may be required under federal law, rule
48 or regulation. The department may promulgate regulations necessary to
49 prevent any potential conflicts of interest between counselors and mort-
50 gage companies to ensure that any counseling and assistance provided
51 under the provisions of this section shall be made in the best interest
52 of the veteran seeking such mortgage loan.
53 § 4. This act shall take effect on the same date and in the same
54 manner as a chapter of the laws of 2022 amending the banking law, the
55 executive law and the veterans' services law relating to certain notices
56 and services upon application for a mortgage guaranteed under the
A. 633 3
1 "Servicemen's Readjustment Act of 1944", as proposed in legislative
2 bills numbers S. 8670-A and A. 9493-A, takes effect; provided that
3 section one of this act shall take effect on the same date and in the
4 same manner as section 2 of part PP of chapter 56 of the laws of 2022,
5 takes effect; and provided, further that the amendments to section 354-f
6 of the executive law made by section two of this act shall not affect
7 the repeal of such section and shall expire and be deemed repealed ther-
8 ewith.
