NY State Senate Bill 2017-S453

Archive: Last Bill Status - In Senate Committee Corporations, Authorities And Commissions 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 corporations, authorities and commissions
Jan 04, 2017	referred to corporations, authorities and commissions

2017-S453 (ACTIVE) - Details

See Assembly Version of this Bill:: A3283
Current Committee:: Senate Corporations, Authorities And Commissions
Law Section:: Public Authorities Law
Laws Affected:: Amd §2404, add §2405-g, Pub Auth L
Versions Introduced in Other Legislative Sessions:: 2009-2010: S1095, A4521
2011-2012: S763, A2520
2013-2014: S4037, A3211
2015-2016: S2274, A3186
2019-2020: S929, A6948
2021-2022: A5637
2023-2024: A4843

2017-S453 (ACTIVE) - Summary

Authorizes the establishment of the home equity protection insurance program directing the agency to issue a commitment to insure and insure the full value of certain residences which are owner-occupied by persons who meet certain income qualifications.

2017-S453 (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S453

 TITLE OF BILL :  An act to amend the public authorities law, in
relation to establishing a home equity protection insurance program

 PURPOSE :

To authorize the State of New York Mortgage Agency to institute a home
equity protection insurance program whereby the agency will insure the
value of residential real property against any loss thereof upon
resale of the property.

 SUMMARY OF PROVISIONS :

This bill adds a new subdivision (33) to Section 2404 of the Public
Authorities Law and a new section 2405-g to authorize the State of New
York Mortgage Agency (SONYMA) to establish and administer a home
equity protection insurance program. Under the program the agency
would insure the full value of an owner-occupied one-to-four family
residence, including a condominium or a cooperative. This program
would be restricted, to middle-and low-income persons who meet the
income qualification threshold for a SONYMA forward commitment
mortgage.  They would not have to obtain a SONYMA mortgage to be
eligible for the home equity protection insurance program. The insured
value of the residential real property would be determined by either
its purchase price, the purchase price plus the cost of rehabilitation

or an appraisal. The insurance would become effective upon payment of
a premium that shall be determined by SONYMA. The insured homeowner
could collect on the policy if upon resale of the real property the
sales price is less than the insured amount (i.e. - the original
purchase price) provided that the loss in value is not predominantly
from the owner's neglect of the property's physical condition. In
addition, in order to be eligible to collect for any decrease in the
policy holder/owner must have lived in the insured residence for a
minimum of three years. The bill also provides that SONYMA must create
a home equity protection insurance fund into which it must deposit any
moneys which may be available to the agency from any source, including
revenues received from insurance premiums for the payment of any
liabilities under the home equity protection insurance program. It
also requires the agency to maintain in the fund a reserve equaling at
least 20% of the total amounts insured. Finally, the bill delineates
the types of investments in which the agency may invest the fund's
moneys. These investments correspond statutorily to the ones
authorized for the agency's mortgage insurance fund.

 JUSTIFICATION :

This bill reflects an attempt to provide homeowners with the
confidence to invest and live in areas of the state that have
experienced depressed residential real property prices. These areas
include upstate cities, parts of New York City, and rural areas. The
bill is modeled after a municipal program in Syracuse which was
developed to help reverse that city's housing decline. By guaranteeing
that homeowners will never lose their equity investment if they
purchase home equity protection insurance, the bill is designed to
help protect low and moderate income homeowners from the vagaries of
the real estate market. Since SONYMA already provides mortgage
insurance for aggregates of its forward commitment housing mortgages,
it represents the home equity protection the ideal agency to initiate
and manage program.

 LEGISLATIVE HISTORY :

2016: S.2274/A.3186 Committed to Rules
2015: S.2274/A.3186 Referred to Corporations, Authorities, and
Commissions
2013,2014: S.4037/A.3211 Referred to Corporations, Authorities, and
Commissions
2011,2012: S.763/A.2520 Referred to Corporations, Authorities, and
Commissions
2009,2010: S.1095/A.4521 Referred to Corporations, Authorities, and
Commissions
2007,2008: S.356/A.4185 Referred to Corporations, Authorities, and
Commissions
2005,2006: S.6249/A.9606 Referred to Corporations, Authorities, and
Commissions
2003,2004: A.6486 Referred to Corporations, Authorities, and
Commissions

 FISCAL IMPLICATIONS :

None.

 EFFECTIVE DATE :
This act shall take effect on the 180th day after it shall have become
law.

2017-S453 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                    453
 
                        2017-2018 Regular Sessions
 
                             I N  S E N A T E
 
                                (PREFILED)
 
                              January 4, 2017
                                ___________
 
 Introduced  by  Sen.  YOUNG  -- read twice and ordered printed, and when
   printed to be committed to the Committee on Corporations,  Authorities
   and Commissions
 
 AN  ACT to amend the public authorities law, in relation to establishing
   a home equity protection insurance program

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Subdivision  33 of section 2404 of the public authorities
 law, as renumbered by chapter 72 of the  laws  of  2016,  is  renumbered
 subdivision 34 and a new subdivision 33 is added to read as follows:
   (33)  TO  ESTABLISH  AND ADMINISTER A HOME EQUITY PROTECTION INSURANCE
 PROGRAM IN ACCORDANCE WITH SECTION TWENTY-FOUR HUNDRED  FIVE-G  OF  THIS
 PART.
   §  2.  The  public  authorities law is amended by adding a new section
 2405-g to read as follows:
   § 2405-G. HOME EQUITY PROTECTION INSURANCE PROGRAM. (1) THE AGENCY  IS
 HEREBY DIRECTED, TO THE EXTENT IT FINDS PRACTICABLE, TO ESTABLISH A HOME
 EQUITY  PROTECTION  INSURANCE PROGRAM WHEREBY IT WILL ISSUE A COMMITMENT
 TO INSURE AND INSURE THE FULL VALUE OF A ONE-TO-FOUR  FAMILY  RESIDENCE,
 INCLUDING A CONDOMINIUM AND A COOPERATIVE, THAT IS OWNER-OCCUPIED BY ANY
 PERSON  OR  PERSONS  WHO  MEET  THE  INCOME QUALIFICATIONS FOR A FORWARD
 COMMITMENT MORTGAGE PURSUANT TO SECTION TWENTY-FOUR  HUNDRED  FIVE-B  OF
 THIS  PART.  THE  FULL  VALUE  OF THE RESIDENTIAL REAL PROPERTY SHALL BE
 DETERMINED BY EITHER ITS PURCHASE PRICE, THE  PURCHASE  PRICE  PLUS  THE
 COST OF ANY REHABILITATION TO THE RESIDENCE, OR AN APPRAISAL. THE INSUR-
 ANCE  SHALL  BE ISSUED BY THE AGENCY AFTER THE PURCHASE OR THE REHABILI-
 TATION OF THE REAL PROPERTY UPON PAYMENT OF A PREMIUM  THAT  THE  AGENCY
 SHALL DETERMINE.
   (2)  UPON THE SALE OF THE RESIDENTIAL REAL PROPERTY THAT IS INSURED BY
 THE AGENCY THROUGH ITS HOME EQUITY INSURANCE PROGRAM, THE  AGENCY  SHALL
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets

                       [ ] is old law to be omitted.
                                                            LBD05773-01-7

 S. 453                              2
 
 PAY THE POLICY HOLDER/OWNER THE DIFFERENCE BETWEEN THE FACE VALUE OF THE
 INSURANCE  POLICY  AND  THE  SALES PRICE OF THE INSURED PREMISES IF SUCH
 SALES  PRICE  IS  LESS  THAN  THE  INSURED  AMOUNT  AND  IF  THE  POLICY
 HOLDER/OWNER  HAS  LIVED  IN  THE PREMISES FOR A PERIOD OF NOT LESS THAN
 THREE YEARS. THE AGENCY SHALL ESTABLISH PROCEDURES TO BE FOLLOWED  BY  A
 POLICY  HOLDER/OWNER  IN  THE  EVENT OF A PAYMENT UNDER THE TERMS OF ANY
 HOME EQUITY  PROTECTION  INSURANCE  POLICY.  THE  AGENCY  SHALL  NOT  BE
 REQUIRED  TO  PAY  ON A CLAIM FOR A LOSS OF EQUITY IF IT DETERMINES THAT
 SUCH LOSS OCCURRED PREDOMINANTLY FROM THE POLICY HOLDER/OWNER'S  NEGLECT
 OF THE REAL PROPERTY'S PHYSICAL CONDITION.
   (3)(A) THE AGENCY SHALL CREATE A HOME EQUITY PROTECTION INSURANCE FUND
 TO  BE  USED AS A REVOLVING FUND FOR CARRYING OUT THE PROVISIONS OF THIS
 SECTION WITH RESPECT TO RESIDENTIAL REAL  PROPERTY  INSURED  THEREUNDER.
 THE AGENCY SHALL PAY INTO SUCH FUND ALL MONEYS WHICH MAY BE AVAILABLE TO
 THE  AGENCY FOR THE PURPOSES OF SUCH FUND FROM ANY SOURCE, INCLUDING BUT
 NOT LIMITED TO THE MONEYS RECEIVED FROM PREMIUMS DERIVED FROM THE  ISSU-
 ANCE OF HOME EQUITY PROTECTION INSURANCE POLICIES.
   (B)  THE  AGENCY  SHALL  MAINTAIN  IN  THE  EQUITY INSURANCE FUND AS A
 RESERVE AN AMOUNT OF MONEY OR CASH EQUIVALENTS EQUAL  TO  NO  LESS  THAN
 TWENTY  PERCENT  OF  THE  AMOUNTS INSURED UNDER THE AGENCY'S HOME EQUITY
 PROTECTION INSURANCE CONTRACTS.
   (4) MONEYS IN SUCH FUND MAY BE INVESTED (A) IN  SPECIAL  TIME  DEPOSIT
 ACCOUNTS  IN, OR CERTIFICATES OF DEPOSIT ISSUED BY, A BANK, TRUST COMPA-
 NY, SAVINGS BANK OR SAVINGS AND LOAN ASSOCIATION LOCATED AND  AUTHORIZED
 TO  DO BUSINESS IN THIS STATE; PROVIDED, HOWEVER, THAT SUCH TIME DEPOSIT
 ACCOUNT OR CERTIFICATE OF DEPOSIT SHALL BE PAYABLE WITHIN SUCH  TIME  AS
 THE PROCEEDS MAY BE NEEDED TO MEET EXPENDITURES ESTIMATED TO BE INCURRED
 BY  THE  AGENCY  AND  PROVIDED FURTHER THAT SUCH TIME DEPOSIT ACCOUNT OR
 CERTIFICATE OF DEPOSIT BE SECURED BY A  PLEDGE  OF  OBLIGATIONS  OF  THE
 UNITED  STATES  OF  AMERICA OR OBLIGATIONS OF THE STATE, ANY CITY OF THE
 STATE, OR OTHER  MUNICIPAL  CORPORATION,  SCHOOL  DISTRICT  OR  DISTRICT
 CORPORATION  OF  THE  STATE  OR  OBLIGATIONS  OF AGENCIES OF THE FEDERAL
 GOVERNMENT; OR (B) IN OBLIGATIONS OF THE UNITED STATES OF AMERICA OR THE
 STATE WHICH MAY FROM TIME TO TIME BE LEGALLY PURCHASED BY SAVINGS  BANKS
 WITHIN THE STATE AS AN INVESTMENT OF FUNDS BELONGING TO THEM OR IN THEIR
 CONTROL,  OR IN OBLIGATIONS OF THE FEDERAL NATIONAL MORTGAGE ASSOCIATION
 PROVIDED SUCH OBLIGATIONS SHALL BE PAYABLE OR REDEEMABLE AT  THE  OPTION
 OF  THE  OWNER  WITHIN  SUCH TIMES AS THE PROCEEDS MAY BE NEEDED TO MEET
 EXPENDITURES ESTIMATED TO BE INCURRED BY THE AGENCY.
   § 3. This act shall take effect on the one hundred eightieth day after
 it shall have become a law.

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Senate Bill S453

Sponsored By

Archive: Last Bill Status - In Senate Committee Corporations, Authorities And Commissions Committee

2017-S453 (ACTIVE) - Details

2017-S453 (ACTIVE) - Summary

2017-S453 (ACTIVE) - Sponsor Memo

2017-S453 (ACTIVE) - Bill Text download pdf

Comments

Senate Bill S453

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Sponsored By

Catharine Young

Archive: Last Bill Status - In Senate Committee Corporations, Authorities And Commissions Committee

2017-S453 (ACTIVE) - Details

2017-S453 (ACTIVE) - Summary

2017-S453 (ACTIVE) - Sponsor Memo

2017-S453 (ACTIVE) - Bill Text download pdf

Comments