Bill Text: NY A07954 | 2011-2012 | General Assembly | Introduced
Bill Title: Requires banks and financial institutions entering into negotiations to modify a mortgage on real property located in this state to be responsible for the continuation of the modification process until its completion regardless of whether the mortgage is sold.
Spectrum: Slight Partisan Bill (Democrat 4-2)
Status: (Introduced - Dead) 2012-01-04 - referred to banks [A07954 Detail]
Download: New_York-2011-A07954-Introduced.html
S T A T E O F N E W Y O R K ________________________________________________________________________ 7954 2011-2012 Regular Sessions I N A S S E M B L Y May 25, 2011 ___________ Introduced by M. of A. PERRY, MONTESANO, P. RIVERA, GALEF, REILLY -- Multi-Sponsored by -- M. of A. MURRAY -- read once and referred to the Committee on Banks AN ACT to amend the banking law, in relation to requiring banks and financial institutions entering into negotiations to modify a mortgage on real property located in this state to be responsible for the continuation of the modification process until its completion regard- less of whether the mortgage is sold THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: 1 Section 1. The banking law is amended by adding a new section 6-n to 2 read as follows: 3 S 6-N. RESPONSIBILITY OF BANKS FOR MORTGAGES BEING PROCESSED FOR 4 MODIFICATION. 1. NOTWITHSTANDING ANY PROVISIONS OF LAW TO THE CONTRARY, 5 ANY BANK OR FINANCIAL INSTITUTION ENTERING INTO NEGOTIATIONS, INCLUDING 6 BUT NOT LIMITED TO PROCESSING AN APPLICATION, TO MODIFY A MORTGAGE ON 7 REAL PROPERTY LOCATED IN THIS STATE SHALL BE RESPONSIBLE FOR THE CONTIN- 8 UATION OF THE MODIFICATION PROCESS UNTIL ITS COMPLETION REGARDLESS OF 9 WHETHER THE MORTGAGE IS SOLD, TRANSFERRED OR BUNDLED INTO A SECURITY 10 PACKAGE FOR PROVISION TO A THIRD PARTY DURING THE MODIFICATION PROCESS. 11 2. IF A MORTGAGE THAT IS THE SUBJECT OF NEGOTIATIONS OR APPLICATION 12 FOR A MODIFICATION OF THE MORTGAGE TERMS IS SOLD, TRANSFERRED OR BUNDLED 13 INTO A SECURITY PACKAGE FOR PROVISION TO A THIRD PARTY DURING THE 14 MODIFICATION PROCESS, SUCH MORTGAGE SHALL BE AUTOMATICALLY DEEMED TO 15 HAVE BEEN MODIFIED AS SPECIFIED IN THE MORTGAGE MODIFICATION APPLICATION 16 AND THE PURCHASER OF SUCH MORTGAGE MUST ACCEPT ANY DECISION RENDERED 17 WITH REGARD TO SUCH MODIFICATION AND BE BOUND BY THE TERMS OF THE 18 MODIFICATION AGREEMENT, INCLUDING THE INTEREST RATE IN EFFECT AT THE 19 TIME OF PROCESSING. THE PURCHASER SHALL ASSUME ALL RIGHTS AND RESPONSI- 20 BILITIES NECESSARY TO COMPLY WITH THE MODIFIED LOAN. EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD11068-01-1 A. 7954 2 1 3. THE PROVISIONS OF THIS SECTION SHALL APPLY TO ANY MORTGAGE LOAN 2 WHICH IS THREE MONTHS OR OLDER AT THE TIME OF THE MODIFICATION PROCESS. 3 S 2. This act shall take effect on the ninetieth day after it shall 4 have become a law.