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Assembly Bill A2667

2019-2020 Legislative Session

Relates to prohibiting pre-payment penalties for mortgages secured by real property owned in a cooperative form of ownership

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Archive: Last Bill Status - In Senate Committee Rules Committee

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2019-A2667 (ACTIVE) - Details

See Senate Version of this Bill:
S3347
Current Committee:
Senate Rules
Law Section:
General Obligations Law
Laws Affected:
Amd §5-501, Gen Ob L
Versions Introduced in Other Legislative Sessions:
2017-2018: A10727
2021-2022: A1877, S4056
2023-2024: A707, S161
2025-2026: A88, S1323

2019-A2667 (ACTIVE) - Summary

Prohibits pre-payment penalties for mortgages secured by real property owned in a cooperative form of ownership where over fifty percent of the units are shareholder occupied.

2019-A2667 (ACTIVE) - Bill Text download pdf 

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   2667
 
                        2019-2020 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             January 24, 2019
                                ___________
 
 Introduced by M. of A. DINOWITZ -- read once and referred to the Commit-
   tee on Judiciary
 
 AN  ACT to amend the general obligations law, in relation to pre-payment
   penalties for mortgages secured by real property owned  in  a  cooper-
   ative form of ownership
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Paragraph b of subdivision 3 of section 5-501 of the gener-
 al obligations law, as amended by chapter 472 of the laws  of  2008,  is
 amended to read as follows:
   b.  notwithstanding  any other provision of law, the unpaid balance of
 the loan or forbearance may be prepaid, in whole  or  in  part,  at  any
 time.  If prepayment is made on or after one year from the date the loan
 or forbearance is made, no penalty may be imposed. If prepayment is made
 prior to such time, no penalty may be imposed unless provision  therefor
 is  expressly made in the loan contract, provided that no penalty may be
 imposed if prohibited by sections six-l and six-m of the banking law. NO
 PREPAYMENT PENALTY OR FEE SHALL BE CHARGED OR COLLECTED  ON  A  LOAN  OR
 FORBEARANCE  SECURED  BY  REAL  PROPERTY  OWNED IN A COOPERATIVE FORM OF
 OWNERSHIP WHERE OVER FIFTY PERCENT OF THE UNITS  ARE  SHAREHOLDER  OCCU-
 PIED.  SUCH PREPAYMENT PENALTY SHALL BE UNENFORCEABLE. In all cases, the
 right of prepayment shall be stated in  the  instrument  evidencing  the
 loan  or  forbearance,  provided,  however,  that the provisions of this
 subdivision shall not apply to the extent such provisions are inconsist-
 ent with any federal law or regulation.
   § 2. This act shall take effect immediately.
 
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD01343-01-9

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