Authorizes the state of New York mortgage agency (SONYMA) to originate mortgages constituting a second lien and defines mortgage as a loan owed to a bank or to the agency secured by a second lien on a fee simple or leasehold estate in real property located in the state and improved by a residential structure whether or not insured by the US or any agency thereof; authorizes such agency to purchase rehabilitation mortgages from banks within the state.
STATE OF NEW YORK
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2632
2011-2012 Regular Sessions
IN ASSEMBLY
January 19, 2011
___________
Introduced by M. of A. FITZPATRICK -- read once and referred to the
Committee on Housing
AN ACT to amend the public authorities law, in relation to the state of
New York mortgage agency
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Subdivision 5 of section 2402 of the public authorities
2 law, as amended by section 1 of chapter 208 of the laws of 2010, is
3 amended to read as follows:
4 (5) "Mortgage". A loan owed to a bank secured by a first lien on a fee
5 simple or leasehold estate in real property located in the state and
6 improved by a residential structure, whether or not insured or guaran-
7 teed by the United States of America or any agency thereof. The term
8 "mortgage" shall also include a loan owed to a bank or to the agency
9 secured by a second lien on a fee simple or leasehold estate in real
10 property located in the state and improved by a residential structure,
11 whether or not insured or guaranteed by the United States of America or
12 any agency thereof, provided, however, that such second lien: (a)
13 secures a loan originated or purchased by the agency, and (b) is made at
14 the same time as a first lien securing a loan purchased by the agency
15 pursuant to its programs or by a government sponsored enterprise or is
16 made at the same time as a new housing loan purchased by the agency
17 pursuant to section twenty-four hundred five-c of this part, provided
18 that, in the case of any second lien, the mortgagor shall be obligated
19 to contribute from his or her own verifiable funds an amount not less
20 than such percentage as the agency shall determine, of the lower of the
21 purchase price or appraised value of the property subject to the first
22 lien. "Real property" as used in this subdivision shall include air
23 rights.
24 For the purposes of this title and of section one hundred ninety and
25 subsection (a) of section one thousand four hundred fifty-six of the tax
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD03500-01-1
A. 2632 2
1 law, "mortgage" shall include housing loans as defined below. Except for
2 the purposes of subdivision seven of section [two thousand four] twen-
3 ty-four hundred five and subdivision eight of section [two thousand
4 four] twenty-four hundred five-b of this part, "mortgage" shall also
5 include: (a) a loan owed to a bank by an individual borrower incurred
6 for the purpose of financing the purchase of certificates of stock or
7 other evidence of ownership of an interest in, and a proprietary lease
8 from, a cooperative housing corporation formed for the purpose of the
9 cooperative ownership of residential real estate in the state, secured
10 by an assignment or transfer of the benefits of such cooperative owner-
11 ship, and containing such terms and conditions as the agency may
12 approve, and (b) a loan owed to the agency by an individual and secured
13 by a second lien and incurred for such purposes, and containing such
14 terms and conditions as the agency may approve, provided, however, that:
15 (i) such loan was originated or purchased by the agency with money from
16 and (ii) is made at the same time as a first lien securing a loan
17 purchased by the agency pursuant to its programs or is made pursuant to
18 section twenty-four hundred five-c of this part.
19 § 2. Subdivision 5 of section 2402 of the public authorities law, as
20 amended by section 2 of chapter 208 of the laws of 2010, is amended to
21 read as follows:
22 (5) "Mortgage". A loan owed to a bank secured by a first lien on a fee
23 simple or leasehold estate in real property located in the state and
24 improved by a residential structure, whether or not insured or guaran-
25 teed by the United States of America or any agency thereof. The term
26 "mortgage" shall also include a loan owed to a bank or to the agency
27 secured by a second lien on a fee simple or leasehold estate in real
28 property located in the state and improved by a residential structure,
29 whether or not insured or guaranteed by the United States of America or
30 any agency thereof, provided, however, that such second lien: (a)
31 secures a loan originated or purchased by the agency, and (b) is made at
32 the same time as a first lien securing a loan purchased by the agency
33 pursuant to its programs or by a government sponsored enterprise or is
34 made at the same time as a new housing loan purchased by the agency
35 pursuant to section twenty-four hundred five-c of this part, provided
36 that, in the case of any second lien, the mortgagor shall be obligated
37 to contribute from his or her own verifiable funds an amount not less
38 than such percentage as the agency shall determine, of the lower of the
39 purchase price or appraised value of the property subject to the first
40 lien. "Real property" as used in this subdivision shall include air
41 rights.
42 Except for the purposes of subdivision seven of section [two thousand
43 four] twenty-four hundred five of this part, "mortgage" shall also
44 include: (a) a loan owed to a bank by an individual borrower incurred
45 for the purpose of financing the purchase of certificates of stock or
46 other evidence of ownership of an interest in, and a proprietary lease
47 from, a cooperative housing corporation formed for the purpose of the
48 cooperative ownership of residential real estate in the state, secured
49 by an assignment or transfer of the benefits of such cooperative owner-
50 ship, and containing such terms and conditions as the agency may
51 approve, and (b) a loan owed to the agency by an individual and secured
52 by a second lien and incurred for such purposes, and containing such
53 terms and conditions as the agency may approve, provided, however, that:
54 (i) such loan was originated or purchased by the agency with money from
55 and (ii) is made at the same time as a first lien securing a loan
A. 2632 3
1 purchased by the agency pursuant to its programs or is made pursuant to
2 section twenty-four hundred five-c of this part.
3 § 3. Subdivision 30 of section 2404 of the public authorities law, as
4 renumbered by chapter 229 of the laws of 2007, is renumbered subdivision
5 31 and a new subdivision 30 is added to read as follows:
6 (30) To originate mortgages constituting a second lien in accordance
7 with subdivision five of section twenty-four hundred two of this part,
8 pursuant to any program authorized by this title.
9 § 4. Paragraph (e) of subdivision 7 of section 2405 of the public
10 authorities law, as amended by chapter 915 of the laws of 1982, is
11 amended to read as follows:
12 (e) the mortgage constitutes a valid first or second lien on the real
13 property described to the agency in accordance with subdivision five of
14 section twenty-four hundred two of this part subject only to real prop-
15 erty taxes not yet due, installments of assessments not yet due, and
16 easements and restrictions of record which do not adversely affect, to a
17 material degree, the use or value of the real property or improvements
18 thereon;
19 § 5. Paragraph (e) of subdivision 7 of section 2405 of the public
20 authorities law, as amended by chapter 1023 of the laws of 1971, is
21 amended to read as follows:
22 (e) the mortgage constitutes a valid first or second lien on the real
23 property described to the agency in accordance with subdivision five of
24 section twenty-four hundred two of this part subject only to real prop-
25 erty taxes not yet due, installments of assessments not yet due, and
26 easements and restrictions of record which do not adversely affect, to a
27 material degree, the use or value of the real property or improvements
28 thereon;
29 § 6. Paragraph (f) of subdivision 8 of section 2405-b of the public
30 authorities law, as added by chapter 915 of the laws of 1982, is amended
31 to read as follows:
32 (f) the mortgage constitutes a valid first or second lien on the real
33 property described to the agency in accordance with subdivision five of
34 section twenty-four hundred two of this part subject only to real prop-
35 erty taxes not yet due, installments of assessments not yet due, and
36 easements and restrictions of record which do not adversely affect, to a
37 material degree, the use or value [or] of the real property or improve-
38 ments thereon;
39 § 7. This act shall take effect immediately, provided that the amend-
40 ments to subdivision 5 of section 2402 of the public authorities law,
41 made by section one of this act, shall be subject to the expiration and
42 reversion of such subdivision pursuant to section 16 of chapter 915 of
43 the laws of 1982, as amended, when upon such date the provisions of
44 section two of this act shall take effect; provided, further, that the
45 amendments to subdivision 5 of section 2402 of the public authorities
46 law, made by section two of this act, shall not affect the expiration of
47 such subdivision and shall be deemed to expire therewith; provided,
48 further, that the amendments to paragraph (e) of subdivision 7 of
49 section 2405 of the public authorities law, made by section four of this
50 act, shall be subject to the expiration and reversion of such subdivi-
51 sion pursuant to section 16 of chapter 915 of the laws of 1982, as
52 amended, when upon such date the provisions of section five of this act
53 shall take effect; and provided, further, however, that the amendments
54 to paragraph (f) of subdivision 8 of section 2405-b of the public
55 authorities law, made by section six of this act, shall not affect the
56 repeal of such section and shall be deemed repealed therewith.
