§ 44-b. Mortgage modifications, evidence of pre-existing indebtedness.
1. Notwithstanding the provision of any law, general or special, the
agency shall have the power to:

(i) consent to and contract for the modification of any of the terms
of a mortgage, and note or bond secured thereby, made pursuant to this
article for the purpose of obtaining insurance of such mortgage loan by
the federal government in order to refinance all or any part of the
indebtedness evidenced by such mortgage and note or bonds, or

(ii) satisfy such mortgage loan in order to enable the company to
obtain insurance by the federal government of a mortgage loan made for
the purpose of refinancing all or any part of the indebtedness evidenced
by such mortgage and note or bond.

Notwithstanding the provisions hereof, the agency on or after June
fifteen, nineteen hundred seventy-six, shall not modify or satisfy a
mortgage loan, pursuant to this subdivision one, where the principal
amount of the mortgage loan insured by the federal government is less
than eighty-five per centum of the principal amount outstanding on the
original mortgage loan at the time such original mortgage loan is
refinanced, unless such modification or satisfaction is first approved
by the New York state public authorities control board created pursuant
to article one-A of the public authorities law.

2. In the event that the existing mortgage loan is satisfied pursuant
to this section, the agency may in consideration of the issuance of such
satisfaction accept a new mortgage and note or bond insured by the
federal government in an amount equal to the maximum principal amount of
a mortgage loan the federal government will insure or accept the
proceeds available to the housing company as a result of the
refinancing.

3. In the event that there is residual indebtedness, the housing
company shall make and the agency shall accept an instrument evidencing
such indebtedness in such form and upon such terms as the agency may
approve, provided that such terms are not inconsistent with subdivision
two of section twenty of this chapter.

4. Notwithstanding any other provisions of this article where the
commissioner has made the findings required in subdivision one of
section twenty-six and where a project has been approved pursuant to
subdivision five of section twenty-six of this chapter, the agency may
make or contract to make a mortgage loan pursuant to subdivision two or
three of this section without further findings by the commissioner or
further approval by the local legislative body.

5. No company shall accept a mortgage loan to be insured by the
federal government made for the purpose of refinancing the existing
mortgage loan of a company which shall exceed the amount which can be
supported by the income derived from the operation of the project at the
rental rate determined by the commissioner that would be necessary to
meet all necessary payments to be made by the company, of all expenses
including fixed charges, sinking funds, reserves and dividends on
outstanding stock as authorized by the commissioner, if the principal
amount of the original mortgage loan of the company were to be fully
repaid over the term of such mortgage loan by constant and equal
payments of principal and interest and if the interest rate on the
company's original mortgage loan was eight and one-half percent per
annum.