S T A T E   O F   N E W   Y O R K
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                                  7833

                       2013-2014 Regular Sessions

                          I N  A S S E M B L Y

                              June 5, 2013
                               ___________

Introduced by M. of A. WRIGHT -- read once and referred to the Committee
  on Housing

AN ACT to amend the public authorities law, in relation to the powers of
  the state of New York mortgage agency

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

  Section 1. Subdivision 5 of section 2402  of  the  public  authorities
law,  as  amended  by  section  1 of chapter 208 of the laws of 2010, is
amended to read as follows:
  (5) "Mortgage". A loan owed to a bank secured by a first lien on a fee
simple or leasehold estate in real property located  in  the  state  and
improved  by  a residential structure, whether or not insured or guaran-
teed by the United States of America or any  agency  thereof.  The  term
"mortgage"  shall also include a loan owed to a bank secured by a second
lien on a fee simple or leasehold estate in real property located in the
state and improved by a residential structure, whether or not insured or
guaranteed by the United  States  of  America  or  any  agency  thereof,
provided,  however,  that such second lien: (a) secures a loan purchased
by the agency, and (b) is made at the same time as a first lien securing
a loan purchased by the agency pursuant to its programs or by a  govern-
ment  sponsored  enterprise or is made at the same time as a new housing
loan purchased by the agency pursuant  to  section  twenty-four  hundred
five-c of this part[, provided that, in]. THE TERM "MORTGAGE" SHALL ALSO
INCLUDE  LOANS  MADE BY THE AGENCY AND SECURED BY A SECOND LIEN ON A FEE
SIMPLE OR LEASEHOLD ESTATE IN REAL PROPERTY LOCATED  IN  THE  STATE  AND
IMPROVED  BY  A RESIDENTIAL STRUCTURE, WHETHER OR NOT INSURED OR GUARAN-
TEED BY THE UNITED STATES OF AMERICA OR  ANY  AGENCY  THEREOF,  PROVIDED
HOWEVER,  THAT  THE  LOAN  MADE BY THE AGENCY AND SECURED BY SUCH SECOND
LIEN IS MADE AT THE SAME TIME AS A FIRST LIEN SECURING A  MORTGAGE  LOAN
PURCHASED  BY  THE  AGENCY  PURSUANT  TO ITS PROGRAMS OR BY A GOVERNMENT
SPONSORED ENTERPRISE. IN the case of any second lien PURCHASED  OR  MADE

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD11375-01-3
              

A. 7833                             2

HEREUNDER,  the  mortgagor  shall be obligated to contribute from his or
her own verifiable funds an amount not less than such percentage as  the
agency  shall determine, of the lower of the purchase price or appraised
value of the property subject to the first lien. "Real property" as used
in this subdivision shall include air rights.
  For  the  purposes of this title and of section one hundred ninety and
subsection (a) of section one thousand four hundred fifty-six of the tax
law, "mortgage" shall include housing loans as defined below. Except for
the purposes of subdivision seven of section two thousand  four  hundred
five  and  subdivision eight of section two thousand four hundred five-b
of this part, "mortgage" shall also include a loan owed to a bank by  an
individual  borrower  incurred for the purpose of financing the purchase
of certificates of stock or other evidence of ownership of  an  interest
in,  and  a  proprietary  lease  from, a cooperative housing corporation
formed for the purpose of the cooperative ownership of residential  real
estate  in  the state, secured by an assignment or transfer of the bene-
fits of such cooperative ownership, and containing such terms and condi-
tions as the agency may approve.
  S 2. Subdivision 5 of section 2402 of the public authorities  law,  as
amended  by  section 2 of chapter 208 of the laws of 2010, is amended to
read as follows:
  (5) "Mortgage". A loan owed to a bank secured by a first lien on a fee
simple or leasehold estate in real property located  in  the  state  and
improved  by  a residential structure, whether or not insured or guaran-
teed by the United States of America or any  agency  thereof.  The  term
"mortgage"  shall also include a loan owed to a bank secured by a second
lien on a fee simple or leasehold estate in real property located in the
state and improved by a residential structure, whether or not insured or
guaranteed by the United  States  of  America  or  any  agency  thereof,
provided,  however,  that such second lien: (a) secures a loan purchased
by the agency, and (b) is made at the same time as a first lien securing
a loan purchased by the agency pursuant to its programs or by a  govern-
ment  sponsored  enterprise or is made at the same time as a new housing
loan purchased by the agency pursuant  to  section  twenty-four  hundred
five-c of this part[, provided that, in]. THE TERM "MORTGAGE" SHALL ALSO
INCLUDE  LOANS  MADE BY THE AGENCY AND SECURED BY A SECOND LIEN ON A FEE
SIMPLE OR LEASEHOLD ESTATE IN REAL PROPERTY LOCATED  IN  THE  STATE  AND
IMPROVED  BY  A RESIDENTIAL STRUCTURE, WHETHER OR NOT INSURED OR GUARAN-
TEED BY THE UNITED STATES OF AMERICA OR  ANY  AGENCY  THEREOF,  PROVIDED
HOWEVER,  THAT  THE  LOAN  MADE BY THE AGENCY AND SECURED BY SUCH SECOND
LIEN IS MADE AT THE SAME TIME AS A FIRST LIEN SECURING A  MORTGAGE  LOAN
PURCHASED  BY  THE  AGENCY  PURSUANT  TO ITS PROGRAMS OR BY A GOVERNMENT
SPONSORED ENTERPRISE. IN the case of any second lien PURCHASED  OR  MADE
HEREUNDER,  the  mortgagor  shall be obligated to contribute from his or
her own verifiable funds an amount not less than such percentage as  the
agency  shall determine, of the lower of the purchase price or appraised
value of the property subject to the first lien. "Real property" as used
in this subdivision shall include air rights.
  Except for the purposes of subdivision seven of section  two  thousand
four  hundred  five  of  this part, "mortgage" shall also include a loan
owed to a bank by an individual borrower incurred  for  the  purpose  of
financing  the  purchase  of  certificates of stock or other evidence of
ownership of an interest in, and a proprietary lease from, a cooperative
housing corporation formed for the purpose of the cooperative  ownership
of  residential  real  estate  in the state, secured by an assignment or

A. 7833                             3

transfer of the benefits of such cooperative ownership,  and  containing
such terms and conditions as the agency may approve.
  S  3.  Subdivision 5 of section 2402 of the public authorities law, as
amended by chapter 432 of the laws  of  2009,  is  amended  to  read  as
follows:
  (5) "Mortgage". A loan owed to a bank secured by a first lien on a fee
simple  or  leasehold  estate  in real property located in the state and
improved by a residential structure, whether or not insured  or  guaran-
teed  by  the  United  States of America or any agency thereof. The term
"mortgage" shall also include a loan owed to a bank secured by a  second
lien on a fee simple or leasehold estate in real property located in the
state and improved by a residential structure, whether or not insured or
guaranteed  by  the  United  States  of  America  or any agency thereof,
provided, however, that such second lien: (a) secures a  loan  purchased
by the agency, and (b) is made at the same time as a first lien securing
a  loan  purchased  by the agency pursuant to its programs or is made at
the same time as a new housing loan purchased by the agency pursuant  to
section  twenty-four  hundred  five-c of this part[, provided that, in].
THE TERM "MORTGAGE" SHALL ALSO INCLUDE LOANS  MADE  BY  THE  AGENCY  AND
SECURED  BY  A  SECOND  LIEN ON A FEE SIMPLE OR LEASEHOLD ESTATE IN REAL
PROPERTY LOCATED IN THE STATE AND IMPROVED BY A  RESIDENTIAL  STRUCTURE,
WHETHER  OR NOT INSURED OR GUARANTEED BY THE UNITED STATES OF AMERICA OR
ANY AGENCY THEREOF, PROVIDED HOWEVER, THAT THE LOAN MADE BY  THE  AGENCY
AND SECURED BY SUCH SECOND LIEN IS MADE AT THE SAME TIME AS A FIRST LIEN
SECURING  A  MORTGAGE  LOAN  PURCHASED  BY  THE  AGENCY  PURSUANT TO ITS
PROGRAMS OR BY A GOVERNMENT SPONSORED ENTERPRISE. IN  the  case  of  any
second  lien, the mortgagor shall be obligated to contribute from his or
her own verifiable funds an amount not less than such percentage as  the
agency  shall determine, of the lower of the purchase price or appraised
value of the property subject to the first lien. "Real property" as used
in this subdivision shall include air rights.
  Except for the purposes of subdivision seven of section  two  thousand
four  hundred  five  of  this part, "mortgage" shall also include a loan
owed to a bank by an individual borrower incurred  for  the  purpose  of
financing  the  purchase  of  certificates of stock or other evidence of
ownership of an interest in, and a proprietary lease from, a cooperative
housing corporation formed for the purpose of the cooperative  ownership
of  residential  real  estate  in the state, secured by an assignment or
transfer of the benefits of such cooperative ownership,  and  containing
such terms and conditions as the agency may approve.
  S  4. Subdivision 17 of section 2402 of the public authorities law, as
added by chapter 208 of the laws of 2010, is amended to read as follows:
  (17) "Government sponsored  enterprises".  Privately  owned,  publicly
chartered  entities, AND WHOLLY-OWNED CORPORATE INSTRUMENTALITIES OF THE
UNITED STATES WITHIN THE DEPARTMENT OF HOUSING  AND  URBAN  DEVELOPMENT,
CREATED  PURSUANT  TO  12  USC 1717(A)(2)(A), ALL created by Congress to
encourage lending and reduce costs primarily in the  housing  sector  of
the economy.
  S  5. Subdivision 30 of section 2404 of the public authorities law, as
renumbered by chapter 229 of the laws of 2007, is renumbered subdivision
31 and a new subdivision 30 is added to read as follows:
  (30) TO MAKE LOANS SECURED BY MORTGAGES SECURED BY A SECOND LIEN ON  A
FEE SIMPLE OR LEASEHOLD ESTATE IN REAL PROPERTY LOCATED IN THE STATE AND
IMPROVED  BY  A RESIDENTIAL STRUCTURE, WHETHER OR NOT INSURED OR GUARAN-
TEED BY THE UNITED STATES OF AMERICA OR  ANY  AGENCY  THEREOF,  PROVIDED
HOWEVER,  THAT  THE  LOAN  MADE BY THE AGENCY AND SECURED BY SUCH SECOND

A. 7833                             4

LIEN IS MADE AT THE SAME TIME AS A FIRST LIEN SECURING A  MORTGAGE  LOAN
PURCHASED  BY  THE  AGENCY  PURSUANT  TO ITS PROGRAMS OR BY A GOVERNMENT
SPONSORED ENTERPRISE.
  S  6. This act shall take effect immediately, provided that the amend-
ments to subdivision 5 of section 2402 of  the  public  authorities  law
made  by  section one of this act shall be subject to the expiration and
reversion of such subdivision pursuant to section 16 of chapter  915  of
the  laws  of  1982,  as  amended, when upon such date the provisions of
section two of this act shall take effect; provided  further,  that  the
amendments  to  subdivision  5 of section 2402 of the public authorities
law made by section two of this act shall be subject to  the  expiration
and  reversion  of such subdivision pursuant to section 4 of chapter 208
of the laws of 2010 as amended, when upon such date  the  provisions  of
section  three of this act shall take effect; provided further, that the
amendments to subdivision 17 of section 2402 made  by  section  four  of
this  act  shall  not affect the repeal of such subdivision and shall be
deemed repealed therewith.