BILL NUMBER:S2028

TITLE OF BILL:
An act
to amend the real property law, in relation to real property
appraisals in certain cases

SUMMARY:
This bill would amend Real Property Law §254-C(1) to require that a
copy of any real estate appraisal required by a lender as part of a
mortgage application be available to the applicant at the closing, if
requested in writing at least ten days prior to the closing.

JUSTIFICATION:
In 1983, the Legislature enacted Section 254-c of the Real Property
Law to give residential mortgage applicants the right to a copy of
any real estate appraisal of the property involved. Under this law,
applicants are entitled to a copy of the real estate appraisal
provided that: 1) the lender mandates an appraisal as part of the
mortgage application process, 2) the applicant is required to pay for
the appraisal and 3) the applicant requests a copy of the appraisal
in writing.

Chapter 245 of the Laws of 1983 was enacted in response to the failure
of many lending institutions to provide borrowers with copies of real
estate appraisals, even though the lender required them and required
              

the borrower to bear the cost of securing these appraisals. By giving
such borrowers a right to a copy of the appraisal Chapter 245 sought
to correct this situation.

Unfortunately, the new law failed to specify a time period for
compliance. Although written requests for copies of real estate
appraisals may have been made prior to the closing, the appraisal
itself need not be made available at the closing.

This situation is further compounded by the fact that many major
lenders may take the mortgage application in one branch office,
process the application in another part of the State and eventually
store all the mortgage materials in yet another part of the State.
This makes securing a copy of the appraisal very difficult for some
borrowers.

This bill would remedy this situation by requiring lenders to have a
copy of the appraisal at the closing, provided that the borrower
makes a written request at least ten days prior to the closing.

FISCAL IMPLICATIONS:
None.

EFFECTIVE DATE:
This act shall take effect on the one hundred twentieth day after it
shall have become a law.