Bill Text: NY S09801 | 2023-2024 | General Assembly | Introduced

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Bill Title: Prohibits lenders from blocking access to funds from a credit line mortgage.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2024-05-30 - REFERRED TO BANKS [S09801 Detail]

Download: New_York-2023-S09801-Introduced.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                          9801

                    IN SENATE

                                      May 30, 2024
                                       ___________

        Introduced  by  Sen.  COMRIE -- read twice and ordered printed, and when
          printed to be committed to the Committee on Banks

        AN ACT to amend the banking law and the real property law,  in  relation
          to credit line mortgages

          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:

     1    Section 1. Section 380-g of the banking law, as added by  chapter  625
     2  of the laws of 1976, is amended to read as follows:
     3    § 380-g.  Power  to  engage in line of credit financing of residential
     4  real estate. 1. A savings and loan association is authorized  to  invest
     5  an  amount, not exceeding the lesser of (a) ten per centum of the sum of
     6  its surplus, undivided profits, and reserves or (b) one  per  centum  of
     7  its  assets,  in  loans or in interests therein the principal purpose of
     8  which is to provide financing with respect to what is or is expected  to
     9  become  primarily  residential  real estate within this state, where (i)
    10  the association relies substantially for  repayment  on  the  borrower's
    11  general  credit  standing,  with  or without other security, or (ii) the
    12  association relies on other assurances for repayment, including but  not
    13  limited  to  a  guaranty or similar obligation of a third party, and, in
    14  either case described in clause (i) or (ii), regardless  of  whether  or
    15  not the association takes security.
    16    2.  A  savings  and  loan  association  shall not revoke, or otherwise
    17  block, a borrower's access  to  credit  financing  of  residential  real
    18  estate  authorized  pursuant  to subdivision one of this section if such
    19  borrower is current on repayment related to  such  credit  financing  of
    20  residential real estate.
    21    §  2.  Section 281 of the real property law is amended by adding a new
    22  subdivision 2-a to read as follows:
    23    2-a. An authorized lender shall not  revoke,  or  otherwise  block,  a
    24  borrower's  access  to credit line mortgages authorized pursuant to this
    25  section if such borrower is current on repayment related to such  credit
    26  line mortgage.
    27    § 3. This act shall take effect immediately.

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD10424-03-4