Bill Text: NY S04605 | 2025-2026 | General Assembly | Introduced

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Bill Title: Allows for mortgagors to cancel or renegotiate forbearance agreements made during a state disaster emergency.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2025-02-10 - REFERRED TO BANKS [S04605 Detail]

Download: New_York-2025-S04605-Introduced.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                          4605

                               2025-2026 Regular Sessions

                    IN SENATE

                                    February 10, 2025
                                       ___________

        Introduced  by  Sen. SANDERS -- 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 allowing for  mortgagors
          to  cancel  or  renegotiate forbearance agreements made during a state
          disaster emergency

          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-l to
     2  read as follows:
     3    §  9-l.  Cancellation  or  renegotiation  of  forbearance   agreements
     4  executed  during a state disaster emergency. 1. As used in this section,
     5  the following terms shall have the following meanings:
     6    (a) "covered period" means the period beginning on the date on which a
     7  state disaster emergency, including, but not limited  to,  the  COVID-19
     8  pandemic,  begins  and  ending on the date that is thirty days after the
     9  date on which such state disaster emergency ends.
    10    (b) "qualified mortgagor" means an individual who resides in New  York
    11  whose  principal dwelling is encumbered by a home loan pursuant to para-
    12  graph (a) of subdivision six of section thirteen  hundred  four  of  the
    13  real property actions and proceedings law or whose principal dwelling is
    14  a  co-operative  unit  whose shares are encumbered by any loan otherwise
    15  meeting the requirements of a home loan under paragraph (a) of  subdivi-
    16  sion  six  of section thirteen hundred four of the real property actions
    17  and proceedings law, from or serviced by a regulated institution.
    18    (c) "regulated institution"  means  any  New  York  regulated  banking
    19  organization  as  defined  under this chapter and any New York regulated
    20  mortgage servicer entity subject to the authority of the department.
    21    2. Notwithstanding any other provision  of  law,  New  York  regulated
    22  institutions  shall  provide  qualified  mortgagors  who have executed a
    23  forbearance agreement with such  regulated  institution  the  option  to

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD09227-01-5
        S. 4605                             2

     1  cancel  or renegotiate the terms of such agreement if such agreement was
     2  executed during a covered period and:
     3    (a)  includes  terms  which  exclude the option of placing missed loan
     4  payments on the back-end of the loan which is subject of  such  forbear-
     5  ance agreement; or
     6    (b)  requires  missed loan payments be made up in full within a period
     7  of less than twelve months from the date of such agreement.
     8    3. Notwithstanding anything to the  contrary  in  this  section,  this
     9  section shall not apply to, and does not affect any mortgage loans made,
    10  insured,  or  securitized by any agency or instrumentality of the United
    11  States, any government sponsored enterprise,  or  a  federal  home  loan
    12  bank,  or  the rights and obligations of any lender, issuer, servicer or
    13  trustee of such obligations,  including  servicers  for  the  Government
    14  National Mortgage Association.
    15    § 2. This act shall take effect immediately.