§ 339-ff. Mortgage investments on units by state agencies, insurers,
banking organizations and fiduciaries; limitation to first mortgages.
(a) The following persons: (1) public officers, bodies of the state,
municipalities, and municipal subdivisions, (2) persons doing an
insurance business (as defined by section one thousand one hundred one
of the insurance law), (3) banking organizations (as defined by section
two of the banking law), and (4) executors, administrators, trustees,
guardians and other fiduciaries, are authorized to invest in bonds,
notes and evidences of indebtedness which are secured by first mortgages
or deeds of trust upon units and the appurtenant common interests,
wherever such persons may invest, and subject to all of the rules and
limitations applicable to such investment, in bonds, notes and evidences
of indebtedness which are secured by first mortgages or deeds of trust
upon real estate. Where the applicable limitations are dependent upon
the type of use of the real estate, only the type of use of the
particular unit or units which constitute the security for such
investment shall be taken into consideration for the purpose of such
limitations. The existence of any prior lien for taxes, assessments or
other similar charges not yet delinquent shall be disregarded in
determining whether a mortgage or deed of trust is a first mortgage or
deed of trust.

(b) No person enumerated in subdivision (a) of this section may invest
in bonds, notes or evidences of indebtedness secured by mortgages or
deeds of trust upon units and the appurtenant common interests, which
are other than first mortgages or deeds of trust thereupon,
notwithstanding any other provision of law (including section three
hundred thirty-nine-g of this chapter).

(c) Notwithstanding subdivisions (a) and (b), banking organizations
are authorized, subject to the rules and limitations applicable thereto
contained in subdivision four-a of section one hundred three,
subdivision six-a of section two hundred thirty-five, subdivision four-a
of section three hundred eighty and subdivision eight of section four
hundred fifty-six of the banking law, and the New York job development
authority is authorized to invest in bonds, notes and evidences of
indebtedness which are secured by mortgages other than first mortgages
upon units and the appurtenant common interests, provided such mortgages
are in compliance with title eight of article eight of the public
authorities law.

(d) Notwithstanding subdivisions (a) and (b) of this section, the New
York state urban development corporation is authorized to invest in
bonds, notes and evidences of indebtedness which are secured by
mortgages other than first mortgages upon units and the appurtenant
common interests, provided that (i) such units are owned or are to be
acquired by a corporation as defined in subparagraph five of paragraph
(a) of section one hundred two of the not-for-profit corporation law and
are to be used for commercial purposes, and such corporation has
executed a loan authorization agreement with the New York state urban
development corporation on or before June thirtieth, nineteen hundred
eighty-eight or (ii) such units are developed as a part of a project of
the New York state urban development corporation that received specific
authorization in chapter eight hundred thirty-nine of the laws of
nineteen hundred eighty-seven; and further provided that such
investments and subordinate mortgages are in compliance with chapter one
hundred seventy-four of the laws of nineteen hundred sixty-eight, as
subsequently amended.

(e) Notwithstanding subdivisions (a) and (b) of this section, the New
York city housing development corporation and a city having a population
of one million or more are authorized to invest in bonds, notes, and
evidences of indebtedness which are secured by mortgages other than
first mortgages upon dwelling units and the appurtenant common interests
provided that such investment is made in connection with a project
undertaken pursuant to the private housing finance law or the general
municipal law.

(f) Notwithstanding subdivisions (a) and (b) of this section, the
division of housing and community renewal and the housing trust fund
corporation, their successors and assigns, are authorized to invest in
bonds, notes, and evidences of indebtedness which are secured by
mortgages other than first mortgages upon dwelling units and the
appurtenant common interests provided that such investment is made in
connection with a project undertaken pursuant to the private housing
finance law.