NY State Senate Bill 2017-S7039

Senate Bill S7039

2017-2018 Legislative Session

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 bill text pdf

Archive: Last Bill Status - In Senate Committee Banks Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 03, 2018	referred to banks

2017-S7039 (ACTIVE) - Details

See Assembly Version of this Bill:: A3435
Current Committee:: Senate Banks
Law Section:: Banking Law
Laws Affected:: Add §35, Bank L
Versions Introduced in Other Legislative Sessions:: 2009-2010: S7399, A257, A10502
2011-2012: S132, A1365
2013-2014: S73, A7281, A5330
2015-2016: S2228, A2536, A2493
2019-2020: S3544, A2141
2021-2022: S5777, A3379
2023-2024: S2665

2017-S7039 (ACTIVE) - 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.

2017-S7039 (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S7039

SPONSOR: KENNEDY
 
TITLE OF BILL:  An act to amend the banking law, in relation to
directing licensed mortgage bankers and authorized mortgage loan origi-
nators 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:

Section 1 of the bill would amend the Banking Law by adding a new
section 35 to provide for the establishment that 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 the

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.

Section 2 of the bill would provide for an effective date of 180 days
after it becomes law.

 
JUSTIFICATION:

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

 
LEGISLATIVE HISTORY:

2015-2016: A. 2536 (Referred to Banks)
2013-2014: A.7281 (Referred to Banks)

 
FISCAL IMPLICATIONS:

To be determined.

 
EFFECTIVE DATE:
This act shall take effect 180 days after it becomes law.

2017-S7039 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7039
 
                             I N  S E N A T E
 
                                (PREFILED)
 
                              January 3, 2018
                                ___________
 
 Introduced  by  Sen. KENNEDY -- 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:
   § 35. INFORMATION PAMPHLET FOR RESIDENTIAL MORTGAGE  APPLICANTS.    1.
 THE  SUPERINTENDENT  SHALL  DEVELOP  A  PAMPHLET  KNOWN AS "THE MORTGAGE
 APPLICANT'S BILL OF RIGHTS" AND POST SUCH PAMPHLET ON  THE  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  ACKNOWLEDGEMENT
 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:
   1. COMPARE THE CHARGES OF DIFFERENT MORTGAGE BROKERS  AND  LENDERS  TO
 OBTAIN THE BEST LOAN POSSIBLE.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets

                       [ ] is old law to be omitted.
                                                            LBD00113-01-7

 S. 7039                             2
 
   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 DEPARTMENT OF FINANCIAL
 SERVICES IF YOU BELIEVE THAT A  MORTGAGE  BROKER  OR  ANY  OTHER  ENTITY
 LICENSED  BY SUCH 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."
   § 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.

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