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Assembly Bill A5347

2017-2018 Legislative Session

Prohibits lenders from blocking access to funds from a credit line mortgage

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Archive: Last Bill Status - In Assembly Committee

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2017-A5347 (ACTIVE) - Details

Current Committee:
Assembly Banks
Law Section:
Banking Law
Laws Affected:
Amd §380-g, Bank L; amd §281, RP L
Versions Introduced in Other Legislative Sessions:
2011-2012: A6893
2013-2014: A588
2015-2016: A3439
2019-2020: A4001

2017-A5347 (ACTIVE) - Summary

Relates to prohibiting a lender from blocking access to funds issued under a credit line mortgage.

2017-A5347 (ACTIVE) - Bill Text download pdf 

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   5347
 
                        2017-2018 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             February 8, 2017
                                ___________
 
 Introduced  by M. of A. WEPRIN -- Multi-Sponsored by -- M. of A. ABINAN-
   TI, COOK, DenDEKKER, GALEF, JAFFEE, McDONOUGH, PERRY, RIVERA,  ZEBROW-
   SKI -- read once and referred 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:
 
   Section  1.  Section 380-g of the banking law, as added by chapter 625
 of the laws of 1976, is amended to read as follows:
   § 380-g. Power to engage in line of credit  financing  of  residential
 real  estate.  1. A savings and loan association is authorized to invest
 an amount, not exceeding the lesser of (a) ten per centum of the sum  of
 its  surplus,  undivided  profits, and reserves or (b) one per centum of
 its assets, in loans or in interests therein the  principal  purpose  of
 which  is to provide financing with respect to what is or is expected to
 become primarily residential real estate within this  state,  where  (i)
 the  association  relies  substantially  for repayment on the borrower's
 general credit standing, with or without other  security,  or  (ii)  the
 association  relies on other assurances for repayment, including but not
 limited to a guaranty or similar obligation of a third  party,  and,  in
 either  case  described  in clause (i) or (ii), regardless of whether or
 not the association takes security.
   2. A SAVINGS AND LOAN ASSOCIATION SHALL  NOT  HAVE  THE  AUTHORITY  TO
 BLOCK  ACCESS  TO CREDIT LINE FUNDS BY A BORROWER OR TO OTHERWISE REVOKE
 THE TERMS OF A CREDIT LINE MORTGAGE WHEN A BORROWER IS CURRENT ON REPAY-
 MENT OF SUCH INDEBTEDNESS.
   § 2. Section 281 of the real property law is amended by adding  a  new
 subdivision 2-a to read as follows:
   2-A. AN AUTHORIZED LENDER SHALL NOT HAVE THE AUTHORITY TO BLOCK ACCESS
 TO CREDIT LINE FUNDS BY A BORROWER OR TO OTHERWISE REVOKE THE TERMS OF A
 CREDIT  LINE  MORTGAGE  WHEN  A BORROWER IS CURRENT ON REPAYMENT OF SUCH
 INDEBTEDNESS.
   § 3. This act shall take effect immediately.

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