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SECTION 27
Limitations
Private Housing Finance (PVH) CHAPTER 44-B, ARTICLE 2
§ 27. Limitations. No company shall:

1. Acquire any real property or interest therein unless it shall first
have obtained from the commissioner or the supervising agency, as the
case may be, a certificate that such acquisition is necessary or
convenient for the public purpose defined in this article.

2. Pay interest upon its income debentures at a rate higher than six
per centum per annum except as otherwise provided in this article.

3. Issue its stock, income debentures and bonds covering any project
in an amount greater in the aggregate than the actual project cost.

4. Without first having obtained the written consent of the
commissioner or the supervising agency, as the case may be:

(a) Construct, reconstruct, rehabilitate, improve or alter any
project, or enter into any contract therefor.

(b) Sell, transfer or assign any real property, except that no such
consent shall be necessary in any sale in foreclosure as herein
provided.

(c) Except as otherwise provided in this article, encumber, lease or
rent all or any part of its real property.

(d) Enter into contracts for the operation of the project.

(e) Make a guaranty of payment.

(f) Voluntarily dissolve.

(g) Enter into contracts for the payment of salaries to officers or
employees.

5. Pay interest on its mortgage indebtedness at a rate higher than six
per centum per annum, or at such higher rates as may be approved by the
commissioner, or the supervising agency, as the case may be, but in no
event shall any such rate exceed the rate of interest prescribed by the
superintendent of financial services pursuant to section fourteen-a of
the banking law or, in the case of a mortgage loan insured or held by
the federal government, the rate approved by the federal government;
provided, however, that in the case of a company carrying out a state
urban development corporation project or in the case of an instrument or
instruments securing the residual indebtedness of a company, which
indebtedness is secured by a mortgage on the real property of a project,
such rate shall not exceed the rate of interest prescribed by the
superintendent of financial services pursuant to section fourteen-a of
the banking law or nine per centum per annum, whichever is the higher;
and further provided, however, that, in the case of a company that is a
mortgagor under a mortgage assigned to or acquired by the New York city
housing development corporation pursuant to subdivision twenty-one of
section six hundred fifty-four of this chapter and whose project is
aided by a subsidy from the federal government, such rate shall be the
rate of interest approved by the supervising agency. Notwithstanding the
foregoing provisions of this section, the rate of interest that a
company shall have the power to pay on that portion of its mortgage
indebtedness attributable to an investment or participation in a loan
made pursuant to subdivision one of section fifteen by an organization
or entity mentioned in such subdivision, shall be the rate of interest
approved by the commissioner or the supervising agency, as the case may
be.

6. Notwithstanding the provisions of subdivision five of this section
twenty-seven, a company, which has obtained a mortgage loan from the New
York city housing development corporation or the New York state housing
finance agency and where it is necessary for additional bonds or notes
to be issued by the New York city housing development corporation or the
New York state housing finance agency (i) in order to obtain funds to
fulfill the mortgage loan commitment to such company, as such commitment
may be amended or (ii) to refund or renew notes issued in fulfillment
thereof, for a project partially or temporarily financed by bonds or
notes issued, in the case of the New York city housing development
corporation, prior to the first day of August, nineteen hundred
seventy-five, and in the case of the New York state housing finance
agency, prior to the thirty-first day of December, nineteen hundred
seventy-five , may pay interest on that portion of its mortgage
indebtedness, the funds for which were obtained by the New York city
housing development corporation or the New York state housing finance
agency through the issuance of such additional or refunding bonds or
notes, at a rate not in excess of the cost of financing incurred by the
New York city housing development corporation or the New York state
housing finance agency, as the case may be, to issue such additional or
refunding bonds or notes, provided that, with respect to the New York
city housing development corporation, such corporation determines that
such cost of financing is reasonable and the commissioner or the
supervising agency, as the case may be, shall approve such cost of
financing.