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This entry was published on 2014-09-22
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SECTION 253-B
Credit line mortgage
Tax (TAX) CHAPTER 60, ARTICLE 11
§ 253-b. Credit line mortgage. 1. In the case of a mortgage which is
a credit line mortgage, as defined in subdivision two of this section,
of real property principally improved or to be improved by a one to six
family owner-occupied residence or dwelling, the principal debt or
obligation which is or under any contingency may be secured at the date
of execution of such mortgage or at any time thereafter within the
meaning of this article shall mean the maximum principal amount
specified in such mortgage. If the tax imposed by and pursuant to the
authority of this article is paid on such maximum principal amount, no
further tax shall be payable on advances or readvances by the lender
pursuant to the recorded primary mortgage, provided such advances or
readvances are made to the original obligor or obligors named in such
recorded primary mortgage. In the event the maximum principal amount of
a credit line mortgage is increased, a tax is imposed as provided in
section two hundred fifty-three and pursuant to the authority of section
two hundred fifty-three-a of this article on such new or further
indebtedness or obligation when the instrument evidencing such further
indebtedness is recorded. In order to better enforce the provisions of
this subdivision and for the privilege of recording an instrument
evidencing a sale or transfer of real property on which the lien of a
credit line mortgage remains outstanding, in the event that a credit
line mortgage remains outstanding after the sale or transfer of the real
property securing the credit line mortgage to a person or persons who is
or are not related to the original obligor or obligors by blood,
marriage or adoption, or where such credit line mortgage that remains
outstanding after such sale or transfer is a credit line mortgage of
property other than real property principally improved or to be improved
by a one to six family owner-occupied residence or dwelling, taxes are
imposed at the rates applicable under section two hundred fifty-three
and pursuant to the authority of section two hundred fifty-three-a on
the principal debt or obligation which is or under any contingency may
be secured at the date when the instrument evidencing the sale or
transfer is recorded and no such instrument shall be recorded until the
taxes imposed in this section are paid.

1-a. In the case of a mortgage which is a credit line mortgage, as
defined in subdivision two of this section, of property other than real
property principally improved or to be improved by a one to six family
owner-occupied residence or dwelling, and where such mortgage is of an
amount less than three million dollars, the tax imposed by and pursuant
to the authority of this article shall be imposed and paid pursuant to
the provisions of subdivision one of this section.

2. For the purposes of this section, a "credit line mortgage" shall
mean any mortgage or deed of trust, other than a mortgage or deed of
trust made pursuant to a building loan contract as defined in
subdivision thirteen of section two of the lien law, which states that
it secures indebtedness under a note, credit agreement or other
financing agreement that reflects the fact that the parties reasonably
contemplate entering into a series of advances, or advances, payments
and readvances, and that limits the aggregate amount at any time
outstanding to a maximum amount specified in such mortgage or deed of
trust. For the purpose of this section, "credit line mortgage" shall not
include a reverse mortgage as defined in sections two hundred eighty and
two hundred eighty-a of the real property law.

3. The commissioner shall promulgate regulations to provide for the
enforcement and administration of the taxes imposed by or pursuant to
subdivisions one and one-a of this section.