N.Y. RPP Law § 265-A — New York Code / Act RPP / Article 8 / Section 265-A
Home equity theft prevention
Status: in_force

§ 265-a. Home equity theft prevention. 1. (a) The legislature finds\nand declares that homeowners who are in default on their mortgages or in\nforeclosure may be vulnerable to fraud, deception, and unfair dealing by\nhome equity purchasers. The recent rapid escalation of home values\nthroughout urban and rural areas has resulted in a significant increase\nin home equity, which constitutes the greatest financial asset held by\nmany homeowners of this state. During the time period between the\ndefault on the mortgage and the scheduled foreclosure sale date,\nhomeowners in financial distress, especially poor, elderly, and\nfinancially unsophisticated homeowners, are vulnerable to aggressive\n"equity purchasers" who induce homeowners to sell their homes for a\nsmall fraction of their fair market values, or in some cases even sign\naway their homes, through the use of schemes which often involve oral\nand written misrepresentations, deceit, intimidation, and other\nunreasonable commercial practices.\n  (b) The legislature declares that it is the express policy of the\nstate to preserve and guard the precious asset of home equity, and the\nsocial as well as the economic value of homeownership.\n  (c) The legislature further finds that equity purchasers may have a\nsignificant impact upon the economy and well-being of this state and its\nlocal communities, and therefore the provisions of this section are\nnecessary to promote the public welfare.\n  (d) The intent and purposes of this section are to provide a homeowner\nwith information necessary to make an informed and intelligent decision\nregarding the sale or transfer of his or her home to an equity\npurchaser; to require that the sales agreement be expressed in writing;\nto safeguard equity sellers against deceit and financial hardship; to\nensure, foster and encourage fair dealing in the sale and purchase of\nhomes in foreclosure or default; to prohibit representations that tend\nto mislead; to prohibit or restrict unfair contract terms; to provide a\ncooling off period for equity sellers who enter into covered contracts;\nto afford equity sellers a reasonable and meaningful opportunity to\nrescind sales to equity purchasers; and to preserve and protect home\nequity for the homeowners of this state.\n  2. The following definitions shall apply to this section:\n  (a) "Bona fide purchaser or encumbrancer for value" means anyone\nacting in good faith who purchases the residential real property from\nthe equity purchaser for valuable consideration or provides the equity\npurchaser with a mortgage or provides a subsequent bona fide purchaser\nwith a mortgage, provided that he or she had no notice of the equity\nseller's continuing right to, or equity in, the property prior to the\nacquisition of title or encumbrance, or of any violation of this section\nby the equity purchaser as related to the subject property.\n  (b) "Business day" means any calendar day except Sunday or the public\nholidays as set forth in section twenty-four of the general construction\nlaw.\n  (c) "Covered contract" means any contract, agreement, or arrangement,\nor any term thereof, between an equity purchaser and equity seller\nwhich:\n  (i) is incident to the sale of a residence in foreclosure; or\n  (ii) is incident to the sale of a residence in foreclosure or default\nwhere such contract, agreement or arrangement includes a reconveyance\narrangement; or\n  (iii) is incident to the sale of a residence that is the collateral\nfor a "distressed home loan" as defined in paragraph (d) of subdivision\none of section two hundred sixty-five-b of this article.\n  For purposes of this section, any reference to the "sale" of a\nresidence by an equity seller to an equity purchaser shall include a\ntransaction where an equity seller receives consideration from the\nequity purchaser, and a transaction involving a transfer of title to the\nequity purchaser where no consideration is provided to the equity\nseller.\n  (d) "Default" means that the equity seller is two months or more\nbehind in his or her mortgage payments.\n  (e) "Equity purchaser" means any person who or entity which acquires\ntitle to any residence in foreclosure or, where applicable, default, or\nthe representative of such person or entity as defined in this\nsubdivision, except a person who acquires such title as follows:\n  (i) to use, and who uses, such property as his or her primary\nresidence;\n  (ii) by a deed from a referee in a foreclosure sale conducted pursuant\nto article thirteen of the real property actions and proceedings law;\n  (iii) at any sale of property authorized by statute;\n  (iv) by order or judgment of any court;\n  (v) from a spouse, or from a parent, grandparent, child, grandchild or\nsibling of such person or such person's spouse;\n  (vi) as a not-for-profit housing organization or as a public housing\nagency; or\n  (vii) a bona fide purchaser or encumbrancer for value.\n  (f) "Equity seller" means a natural person who is a property owner or\nhomeowner at the time of the equity sale.\n  (g) "Foreclosure" means that there is an active notice of pendency\nfiled in court pursuant to article thirteen of the real property actions\nand proceedings law, or a foreclosure action pursuant to article eleven\nor thirteen of the real property actions and proceedings law has been\ncommenced against the subject property, or an action to enforce a\nmortgage note has been commenced against the borrower whose property is\nsecured by a mortgage loan, or the subject property is on an active\nproperty tax or utility lien sale list.\n  (h) "Property owner" or "homeowner" means any or all record title\nowners of the residential real property in foreclosure or, where\napplicable, default at the time of the equity sale.\n  (i) "Reconveyance arrangement" means:\n  (i) the transfer of title to residential real property by an equity\nseller who is in default or foreclosure, either by transfer of interest\nfrom an equity seller to an equity purchaser or by creation of a\nmortgage or other lien or encumbrance during the time of default or\nforeclosure that allows the equity purchaser to obtain legal or\nequitable title to all or part of the property, and\n  (ii) the subsequent conveyance, or promise of a subsequent conveyance,\nof an interest back to the equity seller by the equity purchaser that\nallows the equity seller to regain possession of the property, which\ninterest shall include but not be limited to a purchase agreement,\noption to purchase, or lease.\n  (j) "Representative" means a person who in any manner solicits,\ninduces, arranges, or causes any equity seller to transfer title or\nsolicits any member of the equity seller's family or household to induce\nor cause any equity seller to transfer title to the residence in\nforeclosure or, where applicable, default to the equity purchaser.\n  (k) "Residence" and "residential real property" means residential real\nproperty consisting of one- to four-family dwelling units, one of which\nthe equity seller occupies or occupied at a time immediately prior to\nthe equity sale as his or her primary residence.\n  3. Every covered contract and notice of cancellation attached thereto\nshall be written in letters of a size equal to at least twelve-point\nbold type, in English or in both English and Spanish if Spanish is the\nprimary language of the equity seller, and shall be fully completed and\nsigned and dated by the equity seller and equity purchaser. Any\ninstrument of conveyance shall become effective no sooner than midnight\nof the fifth business day after the date on which the covered contract\nis executed.\n  4. All covered contracts shall contain the entire agreement of the\nparties and shall include, but not be limited to, the following terms:\n  (a) The name, business address, and the telephone number of the equity\npurchaser;\n  (b) The address of the residence in foreclosure or, where applicable,\ndefault;\n  (c) The total consideration to be given by the equity purchaser in\nconnection with or incident to the sale;\n  (d) A complete description of the terms of payment or other\nconsideration including, but not limited to, any services of any nature\nwhich the equity purchaser represents he or she will perform for the\nequity seller before or after the sale;\n  (e) The time, if any, at which physical possession of the residence is\nto be transferred to the equity purchaser and the residence vacated by\nthe equity seller;\n  (f) The terms of any rental or lease agreement;\n  (g) The terms of any reconveyance arrangement;\n  (h) A notice of cancellation as provided in paragraph (a) of\nsubdivision six of this section; and\n  (i) The following notice shall appear on the contract in immediate\nproximity to the space reserved for the equity seller's signature and\nshall be in at least fourteen-point bold type if the covered contract is\nprinted or in capital letters if the covered contract is typed. The\nnotice must contain the name of the equity purchaser and the date and\ntime by which the covered contract must be cancelled. The notice shall\nbe completed by the equity purchaser:\n                    "NOTICE REQUIRED BY NEW YORK LAW\nYou may cancel this contract at any time before midnight of\n________________________________________.\n                                   (Date)\n________________________________________________________________________\n                       (Name of Equity Purchaser)\nor anyone working for ____________________________ CANNOT ask you to\n                       (Name of Equity Purchaser)\nsign or have you sign any deed or any other document until your right to\ncancel this contract has ended.  See attached notice of cancellation\nform for an explanation of this right. You should always consult an\nattorney or community organization before signing any legal documents\nconcerning your home. It is advisable that you find your own attorney,\nand not consult with an attorney who has been provided to you by the\npurchaser. The law requires that this contract contain the entire\nagreement. You should not rely upon any other written or oral agreement\nor promise."\n  The equity purchaser shall accurately enter the date on which the\nright to cancel ends. The covered contract required by this section\nshall survive delivery of any instrument of conveyance of the residence\nin foreclosure or, where applicable, default, and shall have no effect\non persons other than the parties to the covered contract.\n  5. (a) In addition to the right of rescission described in subdivision\neight of this section, the equity seller has the right to cancel any\ncovered contract with an equity purchaser until midnight of the\nfourteenth business day following the day on which the equity seller and\nequity purchaser sign a covered contract that complies with this\nsection.\n  (b) Cancellation occurs when the equity seller, or a representative of\nthe equity seller, personally delivers written notice of cancellation to\nthe address specified in the covered contract or sends a letter via\nfacsimile or other means of written communication, United States mail,\nor through an established commercial letter delivery service, indicating\ncancellation to the business address of the equity purchaser listed on\nthe covered contract. Proof of facsimile delivery or proof of mailing\ncreates a presumption that the notice of cancellation has been\ndelivered.\n  (c) A notice of cancellation given by the equity seller pursuant to\nparagraph (a) of this subdivision need not take the particular form as\nprovided with the covered contract and, however expressed, is effective\nif it indicates the intention of the equity seller not to be bound by\nthe covered contract.\n  (d) Within ten days following receipt of a notice of cancellation\ngiven in accordance with this subdivision, the equity purchaser shall\nreturn without condition any original covered contract and any other\ndocuments signed by the equity seller as well as any fee or other\nconsideration received by the equity purchaser from the equity seller.\nCancellation of the contract shall release the equity seller of all\nobligations to pay fees to the equity purchaser.\n  6. (a) The covered contract shall be accompanied by a form completed\nby the equity purchaser in duplicate, captioned "notice of cancellation"\nin at least twelve-point bold type if the covered contract is printed or\nin capital letters if the covered contract is typed. This form shall be\nattached to the covered contract, shall be easily detachable, and shall\ncontain in type of at least twelve-point if the covered contract is\nprinted or in capital letters if the covered contract is typed, the\nfollowing statement written in the same language as used in the covered\ncontract:\n                         "NOTICE OF CANCELLATION\n This contract was entered into on ____________________________________\n                  (Enter date covered contract signed)\nYou  may  cancel  this  contract for the sale of your house, without any\npenalty   or   obligation,   at   any   time    before    midnight    of\n___________________________. (Enter date)\nTo  cancel  this transaction, personally deliver a signed and dated copy\nof this cancellation notice, or send  it  by  facsimile,  United  States\nmail,  or  an established commercial letter delivery service, indicating\ncancellation to ____________________________________________________, at\n(Name of purchaser) ___________________________________\n(Street address of purchaser's place of business and facsimile number if\nany) NOT LATER THAN midnight of _______________________________________.\n                                    (Enter date)\nIf you wish to cancel this contract,  sign  and  date  both  copies  and\nreturn one copy immediately to the purchaser.\nI hereby cancel this transaction.\n__________________________________/_______________________________"\n  (Seller's signature)                         (Date)\n  (b) The equity purchaser shall provide each equity seller with two\ncopies of the covered contract and attached notice of cancellation. The\nequity purchaser shall accurately enter the date on which the right to\ncancel ends.\n  7. (a) Before midnight of the fourteenth business day after the date\non which the covered contract is executed, the equity purchaser shall\nnot do any of the following:\n  (i) accept from any equity seller an execution of, or induce any\nequity seller to execute, any instrument of conveyance of any interest\nin the residence in foreclosure or, where applicable, default;\n  (ii) record with the county clerk any document, including, but not\nlimited to, any instrument of conveyance, signed by the equity seller;\n  (iii) transfer or encumber or purport to transfer or encumber any\ninterest in the residence in foreclosure or, where applicable, default\nto any third party;\n  (iv) pay the equity seller any consideration; or\n  (v) suggest, encourage, or provide any form which allows the equity\nseller to waive his or her right to cancel or rescind under this\nsection.\n  (b) An equity purchaser shall make no false or misleading statement\nregarding the value of the residence in foreclosure or, where\napplicable, default; the amount of proceeds the equity seller will\nreceive after a foreclosure sale; the timing of the judicial foreclosure\nprocess; any contract term; the equity seller's rights or obligations\nincident to or arising out of the sale transaction; the nature of any\ndocument which the equity purchaser induces the equity seller to sign;\nor any other false or misleading statement concerning the sale of the\nresidence in foreclosure or, where applicable, default, or concerning\nthe reconveyance arrangement.\n  (c) An equity purchaser is prohibited from representing, directly or\nindirectly, that:\n  (i) the equity purchaser is acting as an advisor or a consultant, or\nin any other manner represents that the equity purchaser is acting on\nbehalf of the equity seller;\n  (ii) the equity purchaser has certification or licensure that the\nequity purchaser does not have, or that the equity purchaser is not a\nmember of a licensed profession if he or she is actually such a member;\n  (iii) the equity purchaser is assisting the equity seller to save the\nhouse unless the equity purchaser has a good faith basis for the\nrepresentation; or\n  (iv) the equity purchaser is assisting the equity seller in preventing\na completed foreclosure unless the equity purchaser has a good faith\nbasis for the representation.\n  (d) It is unlawful for any equity purchaser to initiate, enter into,\nnegotiate, or consummate any covered contract involving residential real\nproperty in foreclosure or, where applicable, default if such equity\npurchaser, by the terms of such covered contract, takes undue advantage\nof the equity seller.\n  8. (a) Any transaction involving residential real property in\nforeclosure or, where applicable, default which is in material violation\nof subdivision three, four, six, seven or eleven of this section is\nvoidable and the transaction may be rescinded by the equity seller\nwithin two years of the date of the recording of the conveyance of the\nresidential real property in foreclosure or, where applicable, default.\n  (b) Such rescission shall be effected by giving written notice to the\nequity purchaser and his or her successor in interest, if the successor\nis not a bona fide purchaser or encumbrancer for value as set forth in\nparagraph (c) of this subdivision, and by recording such notice with the\ncounty clerk of the county in which the property is located, within two\nyears of the date of the recording of the conveyance to the equity\npurchaser. The notice of rescission shall contain the name of the equity\nseller and the name of the equity purchaser in addition to any successor\nin interest holding record title to the residential real property and\nshall particularly describe such residential real property. The equity\npurchaser and his or her successor in interest if the successor is not a\nbona fide purchaser or encumbrancer for value as set forth in paragraph\n(c) of this subdivision, shall have twenty days after the delivery of\nthe notice in which to reconvey title to the property free and clear of\nencumbrances created subsequent to the rescinded transaction and which\nare due to the actions of the equity purchaser. As a condition of the\nreconveyance of title, the equity seller shall return to the equity\npurchaser any consideration received from the equity purchaser as part\nof the original transaction. Upon failure to reconvey title within such\ntime, the equity seller may bring an action to enforce the rescission\nand for cancellation of the covered contract and deed.\n  (c) The provisions of this subdivision shall not affect the interest\nof a bona fide purchaser or encumbrancer for value if such purchase or\nencumbrance occurred prior to the recording of the notice of rescission\npursuant to paragraph (b) of this subdivision. Knowledge that the\nproperty was residential real property in foreclosure or, where\napplicable, default shall not impair the status of such persons or\nentities as bona fide purchasers or encumbrancers for value. This\nsubdivision shall not be deemed to abrogate any duty of inquiry which\nexists as to rights or interests of persons in possession of the\nresidential real property in foreclosure or, where applicable, default.\n  (d) In any action brought to enforce a rescission pursuant to this\nsection, a court may award to a prevailing equity seller costs and\nreasonable attorneys' fees.\n  9. An equity seller may bring an action for the recovery of damages or\nequitable relief against an equity purchaser for a violation of\nsubdivision three, four, six, seven or eleven of this section. A court\nmay award to a prevailing equity seller actual damages plus reasonable\nattorneys' fees and costs. In addition, the court may award equitable\nrelief, or increase the award in an amount not to exceed three times the\nequity seller's actual damages, or both, if the court deems such award\nproper. Any action brought pursuant to this section shall be commenced\nwithin six years after the date of the alleged violation.\n  10. (a)(i) Any equity purchaser who, with intent to defraud, violates\nsubdivision seven of this section or engages in any practice which would\noperate as a criminal fraud or deceit upon an equity seller shall, upon\nconviction, be guilty of a class E felony and subject to a fine of not\nmore than twenty-five thousand dollars, imprisonment in accordance with\nthe penal law, or both.\n  (ii) Any equity purchaser who knowingly violates subdivision seven of\nthis section shall, upon conviction, be guilty of a class A misdemeanor\nand subject to a fine of not more than twenty-five thousand dollars,\nimprisonment in accordance with the penal law, or both. A second offense\nwithin five years shall be a class E felony and subject to a fine of not\nmore than twenty-five thousand dollars, imprisonment in accordance with\nthe penal law, or both.\n  (b) An equity purchaser who, when acting in good faith, violates\nsubdivision seven of this section, shall not be deemed to have violated\nsuch subdivision if the equity purchaser:\n  (i) establishes by a preponderance of the evidence that the compliance\nfailure was not intentional and resulted from a bona fide error\nnotwithstanding the maintenance of procedures reasonably adapted to\navoid such errors;\n  (ii) notifies the equity seller within ninety days of the contract\ndate of the compliance failure; and\n  (iii) makes appropriate restitution to the equity seller and\nappropriate adjustments to the transaction within ninety days of the\ncontract date.  Examples of bona fide errors include, but are not\nlimited to, clerical, calculation, computer malfunction and programming,\nand printing errors.  An error of legal judgment with respect to a\nperson's obligations under this section is not a bona fide error, nor is\na failure to provide notices or other material information required by\nthis section.\n  11. (a) In any transaction in which an equity seller purports to grant\na residence in foreclosure or default to an equity purchaser by any\ninstrument which appears to be an absolute conveyance and reserves to\nhimself or herself or is given by the equity purchaser an option to\nrepurchase, such transaction shall create a presumption that the\ntransaction is a loan transaction, which may be overcome by clear and\nconvincing evidence to the contrary, and that the purported absolute\nconveyance is a mortgage.\n  (b) An equity purchaser shall not enter into a reconveyance\narrangement unless:\n  (i) The equity purchaser verifies by appropriate documentation that\nthe equity seller has or is likely to have a reasonable ability to pay\nfor the subsequent conveyance of an interest back to the equity seller.\nIn the case of a lease with an option to purchase, payment ability also\nincludes the reasonable ability to purchase the property within the term\nof the option to purchase. There is a rebuttable presumption that the\nequity purchaser has not verified reasonable payment ability if the\nequity purchaser has not obtained documents other than a statement by\nthe equity seller of assets, liabilities and income. The standard for\ndetermining a reasonable ability to pay shall be the same standard as\nset forth in paragraph (k) of subdivision two of section six-l of the\nbanking law;\n  (ii) the equity purchaser and the equity seller complete a closing for\nany reconveyance arrangement in which the equity purchaser obtains a\ndeed or mortgage from an equity seller. For purposes of this section,\n"closing" means an in-person meeting to complete final documents\nincident to the sale of the real property or creation of a mortgage on\nthe real property conducted by an attorney who is not employed by or an\naffiliate of the equity purchaser;\n  (iii) the equity purchaser obtains the written consent from the equity\nseller before the equity purchaser grants any interest in the property\nto anyone else during such time as the equity seller maintains an\ninterest in the property, including an option to repurchase; and\n  (iv) the equity purchaser notifies all existing mortgage lien holders\nof his or her intent to accept conveyance of an interest in the property\nfrom the equity seller, and fully complies with all terms and conditions\ncontained in the mortgage lien documents, including but not limited to\ndue-on-sale provisions or meeting all qualification requirements for\nassuming the repayment of the mortgage.\n  (c) An equity purchaser shall not enter into repurchase or lease terms\nas part of the reconveyance arrangement that are unfair or commercially\nunreasonable, and is prohibited from engaging in any other unfair or\nunconscionable conduct.\n  (d) As part of a reconveyance arrangement, an equity purchaser shall\neither:\n  (i) ensure that title to the residence is reconveyed to the equity\nseller; or\n  (ii) make a payment to the equity seller such that the equity seller\nhas received consideration in an amount of at least eighty-two percent\nof the fair market value of the property within one hundred twenty days\nof either the eviction or voluntary relinquishment of possession of the\nresidence by the equity seller. The equity purchaser shall make a\ndetailed accounting of the basis for the payment amount, or a detailed\naccounting of the reasons for failure to make a payment, including\nproviding written documentation of expenses, within such one hundred\ntwenty-day period. The accounting shall be on a form prescribed by the\ndepartment of financial services. For purposes of this subparagraph, the\nfollowing applies:\n  (A) there is a rebuttable presumption that an appraisal by a person\nlicensed or certified by an agency of the federal government or this\nstate to appraise real estate establishes the fair market value of the\nproperty;\n  (B) the time for determining the fair market value amount shall be\ndetermined in the reconveyance arrangement as either at the time of the\nexecution of the reconveyance arrangement or at resale to a bona fide\npurchaser. If the covered contract states that the fair market value\nshall be determined at the time of resale, the fair market value shall\nbe the resale price if it is sold within one hundred twenty days of the\neviction or voluntary relinquishment of the property by the equity\nseller. If the covered contract states that the fair market value shall\nbe determined at the time of resale, and the resale is not completed\nwithin one hundred twenty days of the eviction or voluntary\nrelinquishment of the property by the equity seller, the fair market\nvalue shall be determined by an appraisal conducted within ten days\nafter the end of such one hundred twenty-day period and payment, if\nrequired, shall be made to the equity seller. If payment is not made to\nthe equity seller at such time, the fair market value shall be\nrecalculated as the resale price on resale and payment shall be made to\nthe equity seller within fifteen days of resale. A detailed accounting\nof the basis for the payment amount shall be made within fifteen days of\nresale, including providing written documentation of expenses. The\naccounting shall be on a form prescribed by the department of financial\nservices;\n  (C) "consideration" shall mean any payment or thing of value provided\nto the equity seller, including unpaid lease payments owed by the equity\nseller prior to the date of eviction or voluntary relinquishment of the\nproperty, reasonable costs paid to third parties necessary to complete\nthe reconveyance transaction, payment of money to satisfy a debt or\nlegal obligation of the equity seller or the reasonable cost of repairs\nfor damage to the dwelling caused by the equity seller beyond ordinary\nwear and tear; but shall not include amounts imputed as any fee paid\ndirectly or indirectly to the equity purchaser, or his or her\nrepresentative, incident to a reconveyance arrangement, except for\nreasonable costs paid to third parties necessary to complete the\nreconveyance.\n  (D) "resale" means a bona fide market sale of the property subject to\nthe reconveyance arrangement by the equity purchaser to an unaffiliated\nthird party.\n  (E) "resale price" means the purchase price of the property on resale.\n  (e) This subdivision shall not be deemed to abrogate any duty of\ninquiry which exists as to rights or interests of persons in possession\nof the residential real property in foreclosure or default.\n  (f) All deeds or conveyances subject to a reconveyance arrangement\nshall state explicitly on the face of the document that the conveyance\nis subject to a reconveyance arrangement, and shall state the terms of\nthe reconveyance arrangement. Moreover, all reconveyance arrangements\nmust be simultaneously recorded by the equity purchaser with the subject\ndeed in the county clerk's office where the property is located.\n  12. Any provision of a covered contract which attempts or purports to\nlimit the liability of the equity purchaser under this section shall be\nnull and void. Inclusion of such provision shall at the option of the\nequity seller render the covered contract void. The equity purchaser\nshall be liable to the equity seller for all damages proximately caused\nby such provision. Any provision in a covered contract which attempts or\npurports to require arbitration of any dispute arising under this\nsection shall be void at the option of the equity seller.\n  13. In addition to the other remedies provided, whenever there shall\nbe a violation of this section, application may be made by the attorney\ngeneral in the name of the people of the state of New York to a court or\njustice having jurisdiction by a special proceeding to issue an\ninjunction, and upon notice to the defendant of not less than five days,\nto enjoin and restrain the continuance of such violations; and if it\nshall appear to the satisfaction of the court or justice that the\ndefendant has, in fact, violated this section, an injunction may be\nissued by such court or justice, enjoining and restraining any further\nviolation, without requiring proof that any person has, in fact, been\ninjured or damaged thereby. In any such proceeding, the court may make\nallowances to the attorney general as provided in paragraph six of\nsubdivision (a) of section eighty-three hundred three of the civil\npractice law and rules, and direct restitution. Whenever the court shall\ndetermine that a violation of this section has occurred, the court may\nimpose a civil penalty of not more than twenty-five thousand dollars for\neach violation. In connection with any such proposed application, the\nattorney general is authorized to take proof and make a determination of\nthe relevant facts and to issue subpoenas in accordance with the civil\npractice law and rules.\n  14. This section shall not apply to a prior lien holder where the lien\nwas properly recorded prior to the execution of any covered contract by\nboth the equity seller and the equity purchaser nor shall any provision\nof this section be deemed to impair any equity or other available rights\nof any such prior lien holder.\n  15. The provisions of this section shall be liberally construed to\neffectuate the intent and to achieve the purposes set forth in\nsubdivision one of this section.\n  16. The provisions of this section are not exclusive and are in\naddition to any other requirements, rights, remedies, and penalties\nprovided by law.\n  17. Any waiver of the provisions of this section shall be void and\nunenforceable as contrary to the public policy.\n  18. If any provision of this section, or if any application thereof to\nany person or circumstances is held unconstitutional, the remainder of\nthis section and the application of its provisions to other persons and\ncircumstances shall not be affected thereby.\n