Bill Text: NY A10544 | 2019-2020 | General Assembly | Introduced
Bill Title: Relates to the forbearance for commercial retail space property mortgage payments; requires New York regulated banking organizations to make applications for forbearance for commercial retail space mortgages available to qualified mortgagors during the period in which the NY on PAUSE order is in effect in the county wherein the qualified mortgagor is located and to grant such applications for a period of 180 days.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2020-05-28 - referred to banks [A10544 Detail]
Download: New_York-2019-A10544-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ 10544 IN ASSEMBLY May 29, 2020 ___________ Introduced by COMMITTEE ON RULES -- (at request of M. of A. Bichotte) -- read once and referred to the Committee on Banks AN ACT to amend the banking law, in relation to the forbearance for commercial retail space property mortgage payments 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 9-x to 2 read as follows: 3 § 9-x. Commercial retail space property mortgage forbearance. 1. As 4 used in this section, the following terms shall have the following mean- 5 ings: 6 (a) "Covered period" means March seventh, two thousand twenty until 7 the date on which none of the provisions that closed or otherwise 8 restricted public or private businesses or places of public accommo- 9 dation, or required postponement or cancellation of all non-essential 10 gatherings of individuals of any size for any reason in Executive Orders 11 202.3, 202.4, 202.5, 202.6, 202.7, 202.8, 202.10, 202.11, 202.13 or 12 202.14, as extended by Executive Orders 202.28 and 202.31 and as further 13 extended by any future Executive Order, issued in response to the 14 COVID-19 pandemic continue to apply in the county in which the qualified 15 mortgagor's business property is located; 16 (b) "qualified mortgagor" means a small business as defined in section 17 one hundred thirty-one of the economic development law that is organized 18 under New York law and owns a commercial retail space principal place of 19 business in the state of New York that is encumbered by a mortgage loan 20 and serviced by a regulated institution; 21 (c) "regulated institution" means any New York regulated banking 22 organization as defined in this chapter and any New York regulated mort- 23 gage servicer entity subject to supervision by the department; and 24 (d) "trial period plan" means an agreement whereby the mortgagor is 25 required to make trial payments in full and on-time in order to be 26 considered for a permanent loan modification. 27 2. Notwithstanding any other provision of law, New York regulated 28 institutions shall: EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD16532-02-0A. 10544 2 1 (a) make applications for forbearance of any payment due on a mortgage 2 of a commercial retail space property located in New York widely avail- 3 able to any qualified mortgagor who, during the covered period, is in 4 arrears or on a trial period plan, or who has applied for loss miti- 5 gation and demonstrates financial hardship during the covered period; 6 and 7 (b) grant such forbearance for a period of one hundred eighty days to 8 any such qualified mortgagor who is in arrears or on a trial period 9 plan, or who has applied for loss mitigation and demonstrates financial 10 hardship, with the option to extend an additional one hundred eighty 11 days. 12 (c) Such forbearance may be backdated to March seventh, two thousand 13 twenty. 14 3. Notwithstanding any other provision of law, any mortgage forbear- 15 ance granted by a regulated institution pursuant to executive order 16 number 202.9 of two thousand twenty, this section, or any other law, 17 rule or regulation to the qualified mortgagor as a result of financial 18 hardship during the covered period shall be subject to the following 19 provisions: 20 (a) the mortgagor shall have the option to extend the term of the loan 21 for the length of the period of forbearance. The regulated institution 22 shall waive interest on the principal for the term of the forbearance 23 and waive any late fees accumulated as a result of the forbearance; or 24 (b) the mortgagor shall have the option to have the arrears accumu- 25 lated during the forbearance period payable on a monthly basis for the 26 remaining term of the loan without being subject to penalties or late 27 fees incurred as a result of the forbearance; or 28 (c) if the mortgagor is unable to make mortgage payments due to mort- 29 gagors' demonstrated hardship and the mortgagor and regulated institu- 30 tion cannot agree on a mutually acceptable loan modification, the mort- 31 gagor shall have the option to defer arrears accumulated during the 32 forbearance period as a non-interest bearing balloon payment payable at 33 the maturity of the loan consistent with the safety and soundness of 34 such regulated institution, or at the time the loan is satisfied through 35 a refinance or sale of the property. Any late fees accumulated as a 36 result of the forbearance shall be waived. 37 (d) The exercising of options provided for in paragraph (a), (b) or 38 (c) of this subdivision by a qualified mortgagor shall not be reported 39 negatively to any credit bureau by any regulated institution. 40 4. Notwithstanding any other provision of law, adherence with this 41 section shall be a condition precedent to commencing a foreclosure 42 action stemming from missed payments which would have otherwise been 43 subject to this section. A defendant may raise the violation of this 44 section as a defense to a foreclosure action commenced on the defend- 45 ant's property when such action is based on missed payments that would 46 have otherwise been subject to this section. 47 5. Notwithstanding anything to the contrary in this section, this 48 section shall not apply to, and does not affect any mortgage loans made, 49 insured, or securitized by any agency or instrumentality of the United 50 States, any government sponsored enterprise, or a federal home loan 51 bank, or the rights and obligations of any lender, issuer, servicer or 52 trustee of such obligations, including servicers for the Government 53 National Mortgage Association. 54 § 2. This act shall take effect immediately.
