Bill Text: NY S07011 | 2011-2012 | General Assembly | Introduced

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Bill Title: Establishes requirements for purchase agreements for residential real property by which the buyer must maintain the property while full payment is outstanding.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2012-04-20 - REFERRED TO JUDICIARY [S07011 Detail]

Download: New_York-2011-S07011-Introduced.html

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                           S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
                                         7011
                                   I N  S E N A T E
                                    April 20, 2012
                                      ___________
       Introduced  by  Sen.  YOUNG  -- read twice and ordered printed, and when
         printed to be committed to the Committee on Judiciary
       AN ACT to amend the real  property  law,  in  relation  to  establishing
         requirements for land contracts
         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  246-a to read as follows:
    3    S  246-A.  REQUIREMENTS  FOR  LAND  CONTRACTS.  1. DEFINITION. FOR THE
    4  PURPOSES OF THIS SECTION, "LAND CONTRACT" MEANS  ANY  WRITTEN  AGREEMENT
    5  EXECUTED  BETWEEN  A  BUYER AND SELLER OF RESIDENTIAL REAL PROPERTY OR A
    6  PARCEL OF REAL PROPERTY FOR RESIDENTIAL USE,  BY  INSTALLMENT  PAYMENTS,
    7  WITH  A  DEPOSIT  OF  ONE THOUSAND DOLLARS OR MORE, AND A TERM OF NINETY
    8  DAYS OR MORE, PURSUANT TO  WHICH  SUCH  BUYER  IS  RESPONSIBLE  FOR  ALL
    9  REPAIRS  UPON  THE  REAL  PROPERTY AND WILL BE GRANTED TITLE TO THE REAL
   10  PROPERTY UPON THE FULL PAYMENT OF THE STATED PURCHASE PRICE.  SUCH  TERM
   11  SHALL  NOT  INCLUDE A MORTGAGE PURSUANT TO WHICH THE SELLER EXECUTES AND
   12  RECORDS A DEED TO THE REAL  PROPERTY  UPON  THE  BUYER'S  EXECUTION  AND
   13  RECORDING  OF  A  MORTGAGE  UPON  THE REAL PROPERTY; NOR SHALL SUCH TERM
   14  INCLUDE A LEASE OF REAL PROPERTY PURSUANT TO WHICH THE LESSOR  IS  OBLI-
   15  GATED  TO  MAKE  REPAIRS AND PAY REAL PROPERTY TAXES UPON SUCH  PROPERTY
   16  UNTIL THE LESSEE TENDERS THE STATED PURCHASE PRICE.
   17    2. DISCLOSURE NOTICE. NOT LESS THAN TEN DAYS PRIOR TO THE EXECUTION OF
   18  A LAND CONTRACT, THE SELLER SHALL PROVIDE TO THE BUYER A WRITTEN  NOTICE
   19  DELIVERED  BY  CERTIFIED  MAIL.  SUCH  NOTICE  SHALL  BE  ENTITLED "LAND
   20  CONTRACT-CONSUMER CAUTION AND COUNSELING NOTICE" AND SHALL  INCLUDE  THE
   21  FOLLOWING NOTICES:
   22    (A)  "YOU  CAN LOSE THIS PROPERTY IF YOU FAIL TO MAKE THE PAYMENTS AND
   23  MEET THE OTHER REQUIREMENTS OF THE LAND CONTRACT.";
   24    (B) "YOU CAN LOSE THIS PROPERTY IF THE SELLER OF THIS  PROPERTY  LOSES
   25  TITLE TO THIS PROPERTY DUE TO THE FORECLOSURE OF AN EXISTING MORTGAGE OR
   26  OTHER  LIEN,  OR  OTHER  LEGAL  ACTIONS WHICH MAY BE BROUGHT AGAINST THE
   27  SELLER BY CREDITORS OR OTHERS.";
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD15370-02-2
       S. 7011                             2
    1    (C) "YOU CAN LOSE THIS PROPERTY IF OTHER PERSONS HAVE A LEGAL INTEREST
    2  OR CLAIM AGAINST THE PROPERTY.";
    3    (D)  "UNDER THE TERMS OF THIS CONTRACT YOU ARE RESPONSIBLE FOR REPAIRS
    4  TO THIS PROPERTY AND THEREFORE YOU SHOULD HAVE THE  PROPERTY  ADEQUATELY
    5  INSPECTED BEFORE ENTERING INTO THIS CONTRACT.";
    6    (E)  THE  NAME  AND  ADDRESSES  OF THE HOLDERS OF ANY MORTGAGES ON THE
    7  PROPERTY WHOSE CONSENT IS REQUIRED BEFORE THE PROPERTY CAN BE SOLD;
    8    (F) THE EXISTENCE OF ANY MORTGAGES OR LIENS OF RECORD ON THE PROPERTY;
    9  AND
   10    (G) THE UNPAID PROPERTY TAXES OR ASSESSMENTS ON SUCH PROPERTY, IF ANY.
   11    3. MANDATORY PROVISIONS. EVERY LAND CONTRACT SHALL PROVIDE:
   12    (A) THAT IF THE SELLER IS TO PROVIDE THE BUYER WITH  ESCROW  PAYMENTS,
   13  THE  SELLER  MUST  MAINTAIN  THE  ESCROW FUNDS IN A SEPARATE ACCOUNT AND
   14  PROVIDE THE BUYER WITH AN ANNUALIZED ACCOUNTING AND PROOF OF TAXES PAID;
   15    (B) THAT IF THE SELLER DOES NOT RECORD THE LAND CONTRACT  WITHIN  FIVE
   16  DAYS  OF  THE  EXECUTION  OF SUCH CONTRACT, THE BUYER SHALL BE GRANTED A
   17  RIGHT OF RECOVERY AGAINST THE SELLER FOR ALL  PAYMENTS  MADE  UNDER  THE
   18  LAND CONTRACT;
   19    (C)  THAT  THE  BUYER  MUST BE PROVIDED WITH A COPY OF THE RECEIPT FOR
   20  FILING THE LAND CONTRACT WITH THE COUNTY CLERK; AND
   21    (D) THAT THE SELLER MUST PROVIDE THE BUYER WITH WRITTEN  RECEIPTS  FOR
   22  ANY PAYMENTS MADE UNDER THE LAND CONTRACT, INCLUDING DOWN PAYMENTS.
   23    4.   RECORDING  REQUIREMENT.  WITHIN  FIVE  BUSINESS  DAYS  AFTER  THE
   24  EXECUTION OF A LAND CONTRACT, SUCH CONTRACT SHALL  BE  RECORDED  BY  THE
   25  SELLER  IN  THE  COUNTY  CLERK'S  OFFICE IN THE COUNTY IN WHICH THE REAL
   26  PROPERTY IS LOCATED. THE SELLER SHALL PROVIDE THE BUYER WITH A  COPY  OF
   27  THE RECEIPT ISSUED FOR SUCH RECORDING.
   28    5. PROHIBITED TERMS. NO LAND CONTRACT SHALL CONTAIN THE FOLLOWING:
   29    (A) A PROVISION WHICH IMPOSES EXCESSIVE LATE FEES;
   30    (B) A PROVISION IN WHICH THE BUYER CONSENTS TO HIS OR HER REMOVAL FROM
   31  THE CONTRACT BY THE BUYER WITHOUT THE OPTION OF JUDICIAL INTERVENTION OR
   32  A  PROVISION  IN  WHICH  THE  BUYER  AUTOMATICALLY  CONSENTS  TO SUMMARY
   33  PROCEEDINGS BY THE SELLER;
   34    (C) A PROVISION IN WHICH THE BUYER FORFEITS EQUITY  IN  THE  EVENT  OF
   35  DEFAULT; OR
   36    (D) A PROVISION WHICH WAIVES ANY OF THE PROVISIONS OF THIS SECTION.
   37    6.  ENFORCEMENT.  THE  ATTORNEY  GENERAL MAY COMMENCE AN ACTION IN THE
   38  NAME OF THE PEOPLE OF THE STATE OF NEW YORK TO ENFORCE THE TERMS OF THIS
   39  SECTION. A COURT MAY GRANT INJUNCTIVE, DECLARATORY  OR  OTHER  EQUITABLE
   40  RELIEF  IN  ANY  SUCH  ACTION  BROUGHT TO ENFORCE THE PROVISIONS OF THIS
   41  SECTION.
   42    S 2. This act shall take effect on the one hundred twentieth day after
   43  it shall have become a law.