senate Bill S132

Requires mortgage lenders and brokers to provide consumer with mortgage bill of rights pamphlet which must be signed by the consumer prior to mortgage application

download pdf

Sponsor

Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
view actions

actions

  • 05 / Jan / 2011
    • REFERRED TO BANKS
  • 04 / Jan / 2012
    • REFERRED TO BANKS
  • 21 / Feb / 2012
    • NOTICE OF COMMITTEE CONSIDERATION - REQUESTED
  • 07 / Mar / 2012
    • DEFEATED IN BANKS

Summary

Requires mortgage lenders and brokers to provide consumers with a mortgage bill of rights pamphlet which must be read and signed by the consumer prior to applying for a mortgage.

do you support this bill?

Bill Details

See Assembly Version of this Bill:
A1365
Versions:
S132
Legislative Cycle:
2011-2012
Current Committee:
Senate Banks
Law Section:
Banking Law
Laws Affected:
Add ยง35, Bank L
Versions Introduced in Previous Legislative Cycles:
2009-2010: S7399, A10502, A257D
2007-2008: A10219A, S6668, A10219A

Votes

8
10
8
Aye
10
Nay
1
aye with reservations
0
absent
0
excused
0
abstained
show Banks committee vote details

Sponsor Memo

BILL NUMBER:S132

TITLE OF BILL:
An act
to amend the banking law, in relation to directing licensed mortgage
bankers and authorized mortgage loan originators to provide mortgage
applicants with a mortgage bill of rights
pamphlet on residential mortgages

PURPOSE:
Requires mortgage lenders and brokers to provide consumer with
mortgage bill of rights pamphlet which must be signed by the consumer
prior to mortgage application.

SUMMARY OF PROVISIONS:
The Superintendent of Banks shall develop, post on the Departments
website, print, and distribute in sufficient numbers, to every
licensed mortgage lender and banking organization a mortgage bill of
rights pamphlet A copy of such pamphlet shall be given to each person
inquiring about a mortgage loan. Furthermore, no licensed mortgage
lender or banking organization shall accept an application for a
residential mortgage until applicant(s) has signed a statement that
he/she has read and understands the mortgage bill pamphlet.

JUSTIFICATION:
The mortgage crises highlighted the fact that New York State residents
are unaware of their rights and entitlements throughout the mortgage
process. Therefore, I have introduced this bill which will require
the New York State Banking Department to create an informational
pamphlet for lenders to provide to customers prior to said customers
filling out the mortgage application.

LEGISLATIVE HISTORY:
2010: S.7399

FISCAL IMPLICATIONS:
To be determined.

EFFECTIVE DATE:
This act shall take effect on the one hundred twentieth day after is
shall have become a law;
provided that, effective immediately, any and all actions necessary to
implement the provisions of this act on its effective date are
authorized and directed to be completed on or before such date.

view bill text
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                   132

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                               (PREFILED)

                             January 5, 2011
                               ___________

Introduced  by  Sen. PERALTA -- 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 directing licensed mort-
  gage bankers and authorized mortgage loan originators to provide mort-
  gage applicants with a mortgage bill of rights pamphlet on residential
  mortgages

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  The  banking law is amended by adding a new section 35 to
read as follows:
  S 35. INFORMATION PAMPHLET FOR RESIDENTIAL MORTGAGE  APPLICANTS.    1.
THE SUPERINTENDENT OF BANKS SHALL DEVELOP A PAMPHLET KNOWN AS "THE MORT-
GAGE  APPLICANT'S  BILL OF RIGHTS" AND POST SUCH PAMPHLET ON THE BANKING
DEPARTMENT'S INTERNET WEBSITE. COPIES OF SUCH PAMPHLET SHALL BE PROVIDED
TO ALL LICENSED LENDERS AND BANKING ORGANIZATIONS  OFFERING  RESIDENTIAL
MORTGAGE  SERVICES.    A  COPY  OF  SUCH  PAMPHLET  SHALL BE PROVIDED BY
LICENSED LENDERS AND BANKING ORGANIZATIONS TO EACH  PERSON  BEFORE  SUCH
PERSON  ENTERS INTO AN APPLICATION FOR A LOAN SECURED BY A MORTGAGE UPON
RESIDENTIAL REAL PROPERTY. FURTHERMORE, SUCH LICENSED LENDER AND BANKING
ORGANIZATION SHALL NOT ACCEPT AN APPLICATION FOR A RESIDENTIAL  MORTGAGE
UNTIL THE PERSON OR PERSONS APPLYING FOR A MORTGAGE HAVE BEEN PROVIDED A
COPY  OF  THE  BOOKLET  AND ACKNOWLEDGED RECEIPT OF IT IN WRITING. EVERY
LICENSED LENDER AND BANKING ORGANIZATION SHALL  MAINTAIN  SUCH  ACKNOWL-
EDGEMENT ALONG WITH THE APPLICANT'S MORTGAGE LOAN DOCUMENTS.
  2.  THE PAMPHLET AND WEBSITE NOTICE DEVELOPED PURSUANT TO THIS SECTION
SHALL INCLUDE THE FOLLOWING, ALONG WITH OTHER INFORMATION ADDED  AT  THE
DISCRETION  OF  THE  SUPERINTENDENT  NOT OTHERWISE INCONSISTENT WITH THE
INFORMATION SET FORTH IN THE PAMPHLET:
  "BILL OF RIGHTS FOR RESIDENTIAL MORTGAGE APPLICANTS
AS AN APPLICANT FOR A RESIDENTIAL MORTGAGE YOU HAVE THE RIGHT TO:

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD03298-01-1

S. 132                              2

  1. COMPARE THE CHARGES OF DIFFERENT MORTGAGE BROKERS  AND  LENDERS  TO
OBTAIN THE BEST LOAN POSSIBLE.
  2.  ASK  YOUR  MORTGAGE  BROKER TO EXPLAIN HIS OR HER RESPONSIBILITIES
WITHIN THE MORTGAGE LENDING PROCESS.
  3. KNOW HOW MUCH THE MORTGAGE BROKER IS COMPENSATED  BY  YOU  AND  THE
LENDER FOR YOUR LOAN.
  4. A CLEAR AND TRUTHFUL EXPLANATION OF THE TERMS AND CONDITIONS OF THE
LOAN.
  5.  KNOW IF THE LOAN BEING OFFERED IS A FIXED OR ADJUSTABLE RATE MORT-
GAGE LOAN, KNOW THE EXACT AMOUNT OF YOUR MONTHLY LOAN PAYMENTS,  INCLUD-
ING ANY PROJECTED ESCROW PAYMENTS, KNOW THE FINAL ANNUAL PERCENTAGE RATE
(APR) AND THE AMOUNT OF REGULAR PAYMENTS AT THE LOAN'S CLOSING.
  6.  ASK  FOR  A GOOD FAITH ESTIMATE OF ALL LOAN AND SETTLEMENT CHARGES
BEFORE YOU AGREE TO THE LOAN AND PAY ANY FEES, SUCH AS LOAN  APPLICATION
FEES,  TITLE SEARCH AND INSURANCE FEES, LENDER'S ATTORNEY FEES, PROPERTY
APPRAISAL CHARGES, INSPECTIONS, RECORDING FEES,  TRANSFER  TAXES,  POINT
AND ORIGINATION FEES, AND ESCROW ACCOUNT BALANCES.
  7. OBTAIN CREDIT COUNSELING BEFORE CLOSING A LOAN.
  8. DECIDE WHETHER OR NOT TO FINANCE ANY PORTION OF THE POINTS OR FEES.
  9. REFUSE TO PURCHASE CREDIT INSURANCE FOR ANY MORTGAGE LOAN.
  10.  HAVE  YOUR  PROPERTY APPRAISED BY AN INDEPENDENT LICENSED PROFES-
SIONAL AND TO RECEIVE A COPY OF THE APPRAISAL.
  11. NOT BE SUBJECT TO DECEPTIVE MARKETING PRACTICES.
  12. ASK FOR THE HUD SETTLEMENT COSTS BOOKLET, "BUYING YOUR HOME".
  13. RECEIVE THE FOLLOWING  DOCUMENTS,  AND  EVERY  DOCUMENT  OTHERWISE
REQUIRED  TO BE GIVEN TO YOU AT CLOSING UNDER FEDERAL AND NEW YORK STATE
LAW:
  A. GOOD FAITH ESTIMATE
  B. TRUTH IN LENDING
  C. HUD-1 STATEMENT
  14. KNOW WHAT FEES ARE NOT REFUNDABLE IF YOU DECIDE TO CANCEL THE LOAN
AGREEMENT.
  15. RECEIVE IN WRITING  THE  REASON  FOR  THE  DENIAL  OR  CONDITIONAL
APPROVAL OF YOUR LOAN APPLICATION.
  16.  IF  REFINANCING,  YOU  MAY CANCEL A LOAN WITHIN THREE DAYS OF THE
CLOSING  BY  PROVIDING  WRITTEN  NOTIFICATION  OF  CANCELLATION  TO  THE
LICENSED LENDER OR BANKING INSTITUTION.
  17. RECEIVE THE HUD-1 DOCUMENT ONE DAY BEFORE THE CLOSING TAKES PLACE.
  18. HAVE ANY LENDING DISPUTES RESOLVED IN A FAIR AND EQUITABLE MANNER.
  19.  A  CREDIT  DECISION  THAT  IS  NOT  BASED  UPON YOUR RACE, COLOR,
NATIONAL ORIGIN, RELIGION, SEX, FAMILY STATUS, SEXUAL ORIENTATION, DISA-
BILITY OR WHETHER ANY INCOME IS FROM PUBLIC ASSISTANCE.
  20. FILE A COMPLAINT WITH THE NEW YORK STATE BANKING DEPARTMENT IF YOU
BELIEVE THAT A MORTGAGE BROKER OR ANY OTHER ENTITY LICENSED BY THE BANK-
ING DEPARTMENT HAS VIOLATED ANY RULES, REGULATIONS OR LAWS WHICH  GOVERN
HIS  OR  HER  CONDUCT  IN  WORKING WITH YOU TO GET OR PROCESS A MORTGAGE
LOAN.
  21. FILE A COMPLAINT WITH THE NEW YORK STATE DEPARTMENT  OF  STATE  IF
YOU  BELIEVE  THAT  A  REAL  ESTATE BROKER HAS VIOLATED ANY RULES, REGU-
LATIONS OR LAW WHICH GOVERNS HIS OR HER CONDUCT IN WORKING WITH  YOU  TO
PURCHASE A HOME."
  S 2. This act shall take effect on the one hundred twentieth day after
it  shall  have  become a law; provided that, effective immediately, any
and all actions necessary to implement the provisions of this act on its
effective date are authorized and directed to be completed on or  before
such date.

Comments

Open Legislation comments facilitate discussion of New York State legislation. All comments are subject to moderation. Comments deemed off-topic, commercial, campaign-related, self-promotional; or that contain profanity or hate speech; or that link to sites outside of the nysenate.gov domain are not permitted, and will not be published. Comment moderation is generally performed Monday through Friday.

By contributing or voting you agree to the Terms of Participation and verify you are over 13.