Assembly Bill A10727

2017-2018 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 - On Floor Calendar

  • 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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2017-A10727 (ACTIVE) - Details

Law Section:
General Obligations Law
Laws Affected:
Amd §5-501, Gen Ob L
Versions Introduced in Other Legislative Sessions:
2019-2020: A2667
2021-2022: A1877
2023-2024: A707

2017-A10727 (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.

2017-A10727 (ACTIVE) - Bill Text download pdf 

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   10727
 
                           I N  A S S E M B L Y
 
                               May 15, 2018
                                ___________
 
 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.
                                                            LBD15196-01-8

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