2023 New York Laws › BNK - Banking › Article 1 - Short Title; Definitions; Miscellaneous Provisions. › 6-A - Investment in Obligations of Certain Persons Sixty-Five Years of Age or Over Incurred to Satisfy Real Property Tax Indebtedness.

§ 6-a.  Investment  in obligations of certain persons sixty-five years
of age or over incurred to satisfy real property  tax  indebtedness.  1.
Subject  to  such  regulations and restrictions as the superintendent of
financial services finds to be necessary and proper and  notwithstanding
any  inconsistent  provision  of this chapter to the contrary, any bank,
trust company, savings bank,  savings  and  loan  association,  or  life
insurance company authorized to do business in this state may make loans
described in subdivision two of this section.
2.  Banking  institutions  described in subdivision one may make loans
under this section to natural persons aged sixty-five or  older  subject
to the following conditions:
(a)  the  principal  amount of the loan shall not exceed the aggregate
amount of all real  property  taxes,  special  ad  valorem  levies,  and
special  assessments  paid  or  owing by the borrower for the current or
prior years or both with respect to real property owned individually  or
jointly  by  such  borrower which constitutes the principal residence of
such borrower; provided, however, that the loan  agreement  may  provide
for  such  principal  amount  to  be  modified  to include the amount of
additional real property taxes, special ad valorem levies,  and  special
assessments pertaining to such property as they are incurred; and
(b)  such  loan  shall be secured by a first or second mortgage on the
property which mortgage expressly states in like or similar terms  "this
mortgage  is  given  to secure a loan made pursuant to the provisions of
section six-a of the banking law"; and
(c) the annual interest chargeable on such loan shall not  exceed  the
allowable  interest  chargeable  by such lender to any other person, not
including a corporation, on an obligation secured by  a  first  mortgage
lien; and
(d)  a  loan which is undertaken pursuant to this section shall not be
payable until the sale or other disposition of such  property,  provided
however  that  any  borrower  may  discharge  any  indebtedness  he  has
undertaken pursuant to the  provisions  of  this  section  at  any  time
without payment of any charges other than principal and interest.
3. Subject to regulations of the superintendent of financial services,
banking  institutions described in subdivision one of this section which
make loans pursuant to this section may, pursuant to the loan agreement,
utilize part or all of the proceeds of such loan to make direct  payment
of   real  property  taxes,  special  ad  valorem  levies,  and  special
assessments  on  the  property  which  secures  such  loan.   Any   such
institution  which  retains part or all of the proceeds of such loan for
the purpose of making  direct  payment  of  such  real  property  taxes,
special  ad  valorem  levies, and special assessments shall be liable to
such borrower, upon failure to pay such taxes, levies,  and  assessments
for the amount of such taxes, levies, and assessments plus penalties and
interest imposed thereon.
4.  Every  banking  institution  which  makes  direct  payment of real
property taxes, special  ad  valorem  levies,  and  special  assessments
pursuant  to  subdivision  three  shall at least annually provide to the
borrower any paid bill it has received for the payment  of  such  taxes,
levies,  and  assessments.  Such bill shall be contained in a succeeding
loan statement as may be sent to such borrower. This section  shall  not
apply  to  billings  for real property taxes, special ad valorem levies,
and special assessments transmitted by computer tape by a  city  with  a
population of one million or more persons.