Bill Text: NY S06124 | 2011-2012 | General Assembly | Introduced

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Bill Title: Relates to the dealings of mortgage brokers and home improvement contractors; exempts from provisions relating to payment of mortgage proceeds to a borrower or third party, rather than directly to a home improvement contractor, those home improvement loans insured by the FHA under the National Housing Act or the Energy Policy Act of 1992.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2012-01-18 - SUBSTITUTED BY A8909 [S06124 Detail]

Download: New_York-2011-S06124-Introduced.html

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                           S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
                                         6124
                                   I N  S E N A T E
                                      (PREFILED)
                                    January 4, 2012
                                      ___________
       Introduced  by  Sen.  SAVINO -- read twice and ordered printed, and when
         printed to be committed to the Committee on Banks
       AN ACT to amend the banking law, in relation to the dealings of mortgage
         brokers and home improvement contractors
         THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
       BLY, DO ENACT AS FOLLOWS:
    1    Section 1. Subdivision 2 of section 595-c of the banking law, as added
    2  by chapter 593 of the laws of 2011, is amended to read as follows:
    3    2. Where a mortgage broker has solicited, processed, placed or negoti-
    4  ated  a  mortgage  loan, a home improvement contractor shall not be paid
    5  directly but instead may receive payment from the  proceeds  of  a  home
    6  improvement  loan  payable solely to the borrower or, at the election of
    7  the borrower, through an independent third party escrow agent in accord-
    8  ance with the terms established in a written  agreement  signed  by  the
    9  borrower,  the  lender and the contractor prior to disbursement. A mort-
   10  gage broker shall not offer a homeowner different loan terms  contingent
   11  on the homeowner executing an agreement for payment through an independ-
   12  ent  third party as described in the preceding sentence. Any such agree-
   13  ment shall contain a clear  and  conspicuous  disclosure:  YOU  ARE  NOT
   14  REQUIRED  TO  EXECUTE  THIS  AGREEMENT.  YOU MAY INSTEAD RECEIVE PAYMENT
   15  DIRECTLY.  (NAME OF MORTGAGE BROKER) MAY NOT OFFER YOU  DIFFERENT  TERMS
   16  ON YOUR LOAN TO SIGN THIS AGREEMENT.  THE PROVISIONS OF THIS SUBDIVISION
   17  SHALL  NOT APPLY TO A HOME IMPROVEMENT LOAN INSURED BY THE FEDERAL HOUS-
   18  ING ADMINISTRATION UNDER SECTION 203(K) OF THE NATIONAL HOUSING ACT,  12
   19  U.S.C.  1709(K), OR TO AMOUNTS ADDED TO A FEDERAL HOUSING ADMINISTRATION
   20  INSURED MORTGAGE UNDER THE ENERGY EFFICIENCY MORTGAGE PROGRAM ORIGINALLY
   21  ESTABLISHED UNDER SECTION 106 OF THE ENERGY POLICY ACT OF 1992, AS  FROM
   22  TIME TO TIME AMENDED.
   23    S  2.  This  act  shall  take  effect on the same date and in the same
   24  manner as section 1 of chapter 593 of the laws of 2011, takes effect.
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD12084-02-2