Bill Text: NY S01541 | 2023-2024 | General Assembly | Introduced
Bill Title: Provides for the establishment of the New York state home equity conversion information summary to provide notice of mortgagor's right and responsibilities under reverse mortgage loans issued under the home equity conversion mortgage program of the federal Department of Housing and Urban Development; provides that every authorized lender must provide copies of such summary not less than 5 days prior to closing on a reverse mortgage loan; establishes a private right of action for violations of such provisions.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced) 2024-01-03 - REFERRED TO AGING [S01541 Detail]
Download: New_York-2023-S01541-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ 1541 2023-2024 Regular Sessions IN SENATE January 12, 2023 ___________ Introduced by Sen. COMRIE -- read twice and ordered printed, and when printed to be committed to the Committee on Aging AN ACT to amend the real property law, in relation to the provision of certain information to mortgagors of reverse mortgages issued under the federal home equity conversion mortgage for seniors program The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. The real property law is amended by adding a new section 2 280-c to read as follows: 3 § 280-c. Federal home equity conversion mortgage information summary 4 sheet. 1. For the purposes of this section the following terms shall 5 have the following meanings: 6 (a) A reverse mortgage loan as defined in section two hundred eighty 7 of this article, which is issued in this state pursuant to the home 8 equity conversion mortgage for seniors program operated by the federal 9 Department of Housing and Urban Development. 10 (b) An authorized lender as defined in section two hundred eighty of 11 this article authorized to make reverse mortgage loans, as defined in 12 this section. 13 (c) A mortgagor as defined in section two hundred eighty of this arti- 14 cle. 15 (d) The department of financial services established pursuant to 16 section one hundred two of the financial services law. 17 2. The department shall establish and distribute to authorized lend- 18 ers, and periodically update, a New York state home equity conversion 19 information summary. Such summary shall include, but not be limited to: 20 (a) notice that reverse mortgage loans are not free or cost free, and 21 such loans have associated costs that are included in the financing 22 thereof; 23 (b) a schedule of payments to be made to and from the mortgagor, and 24 the total payment for both the mortgagee and the authorized lender over EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD03620-01-3S. 1541 2 1 the term of the reverse mortgage loan contingent upon the type of such 2 loan being offered; 3 (c) a statement advising mortgagors to consult with licensed profes- 4 sionals regarding the tax and estate planning consequences of reverse 5 mortgage loans; 6 (d) where applicable, a description of the prepayment and refinancing 7 provisions of the reverse mortgage loan; 8 (e) an explanation and itemization of the potential costs of reverse 9 mortgage loans, including the rate of interest and total interest paya- 10 ble on such loan; 11 (f) a summary of actions or conditions that will constitute a default 12 of the reverse mortgage loan; 13 (g) a summary and explanation of alternatives to entering into a 14 reverse mortgage loan on the basis of economic hardship including, but 15 not limited to, direct sale of the residence, social safety net 16 programs, debt consolidation or economic counseling; 17 (h) information on a mortgagor's basic rights in the foreclosure proc- 18 ess; 19 (i) a summary of the real property tax exemptions which are available 20 to the mortgagor in order to reduce his or her cost of living; 21 (j) information about New York state-based organizations that provide 22 federal Department of Housing and Urban Development certified reverse 23 mortgage counseling; 24 (k) information on legal assistance and advocacy organizations and 25 services which provide assistance to mortgagors in the event that 26 complications or issues arise relating to the reverse mortgage loan; and 27 (l) such other information as the department shall deem necessary to 28 fully inform mortgagors of their rights and responsibilities under a 29 reverse mortgage loan. 30 3. Not less than five days prior to the closing upon a reverse mort- 31 gage loan, the authorized lender shall provide the mortgagor with a 32 completed New York state home equity conversion information summary in 33 duplicate. Each mortgagor shall sign both copies of such summary, 34 attesting that he or she has read and fully understands the summary. One 35 copy thereof shall be retained by the authorized lender and the other 36 shall be retained by the mortgagor's attorney. 37 4. The provision of the information summary established by this 38 section is integral to the execution of a reverse mortgage loan, thus in 39 the absence of such a summary the related reverse mortgage loan shall be 40 null and void. 41 5. Any person who has been injured by reason of any violation of this 42 section or the rules and regulations related thereto may bring an action 43 in his or her own name to recover treble his or her actual damages, plus 44 the prevailing plaintiff's reasonable attorneys fee. 45 6. The superintendent of financial services is authorized to promul- 46 gate any rules or regulations he or she deems necessary to implement the 47 provisions of this section. 48 § 2. This act shall take effect on the one hundred twentieth day after 49 it shall have become a law. Effective immediately, the addition, amend- 50 ment and/or repeal of any rule or regulation necessary for the implemen- 51 tation of this act on its effective date are authorized to be made and 52 completed on or before such effective date.
