2023 New York Laws › PVH - Private Housing Finance › Article 12 - New York City Housing Development Corporation › 654-D - Residential Mortgage Insurance Corporation.

§  654-d.  Residential mortgage insurance corporation. 1. Definitions.
As used in this section, the following words and terms  shall  have  the
following   meanings  unless  the  context  shall  indicate  another  or
different meaning or intent:
(a) "Cash equivalent". A letter of credit, insurance  policy,  surety,
guarantee, indemnity or other security arrangement.
(b)  "Financial  institution".  (i)  Any bank, trust company, national
bank, state or federal savings bank, state or federal savings  and  loan
association,  or  state  or  federal  credit  union,  insurance company,
pension fund or retirement system of any corporation,  association,  any
other  entity  which  is  owned  or controlled by any one or more of the
above, provided such  bank,  trust  company,  national  bank,  state  or
federal  savings bank, state or federal savings and loan association, or
state or federal  credit  union,  insurance  company,  pension  fund  or
retirement  system  of any corporation or association, and, if an entity
which is owned by one or more of the above, such entity,  is  supervised
by  or  responsible  to any agency of the federal government, the state,
any department thereof or the  governing  body  of  any  city,  town  or
village  of  the  state,  or  (ii)  any  other  entity  approved  by the
subsidiary corporation, or (iii) any one  or  more  of  the  above  when
lawfully  acting  as a trustee or otherwise in a fiduciary capacity. The
term "financial institution" shall  also  include  the  New  York  state
housing  finance  agency,  the  New  York  state medical care facilities
finance agency, the state of New York  mortgage  agency,  the  New  York
state  urban development corporation, the corporation, the New York city
department  of  housing  preservation  and  development,  the  community
preservation  corporation,  any governmental agency of the United States
which customarily makes, purchases or holds  residential  mortgages  and
any  person  who is approved as a mortgage lender by the federal housing
administration for purposes of insurance issued by  such  administration
or licensed by the state of New York as a mortgage banker.
(c)  "Housing  accommodation".  Any existing building, structure, unit
thereof (including  an  owner-occupied  unit  in  a  condominium  and  a
lessee-occupied  dwelling unit in which the lessee retains a proprietary
lease with respect to such dwelling unit and has an allocable  ownership
interest  in  a  cooperative  housing  corporation)  or  unimproved real
property, which is used or occupied,  or  is  intended  to  be  used  or
occupied  as  the home or residence of one or more persons, a portion of
which may also be used for commercial  and  other  community  facilities
ancillary  to  such  residence provided that, in the case of any housing
accommodation consisting of more than six dwelling units, the floor area
of above-ground commercial facilities shall not  exceed  one-quarter  of
the  above-ground floor area of such housing accommodation (inclusive of
such commercial facilities).
(d) "Housing insurance contracts". All contracts entered into  by  the
subsidiary corporation to insure mortgages pursuant to this section, but
not  including (i) any contracts to insure mortgages entered into by the
predecessor corporation which  are  imposed  upon  and  assumed  by  the
subsidiary  corporation  pursuant to paragraph (d) of subdivision two of
this section, or (ii) any contracts to insure mortgages entered into  by
the  subsidiary corporation with respect to which a commitment to insure
was issued by the predecessor corporation.
(e)  "Housing  insurance  fund".  The  housing   insurance   fund   as
established pursuant to subdivision twelve of this section.
(f) "Housing insurance fund requirement". As of any particular date of
computation,  an  amount  equal  to the aggregate of (i) one hundred per
centum of  the  insured  amounts  due  and  payable  by  the  subsidiary
corporation  pursuant  to  housing insurance contracts, plus (ii) twenty

per centum of the insured  amounts  under  housing  insurance  contracts
other  than  insured  amounts  which are due and payable pursuant to (i)
above, plus (iii) twenty per centum of the amounts to be  insured  under
housing  insurance  contracts  pursuant  to the subsidiary corporation's
commitments to insure.
(g) "Mortgage". A first mortgage on real property located  within  the
city of New York, securing a preservation loan or a rehabilitation loan,
with  a  term  not  to  exceed  forty years, on real estate, held in fee
simple or on a leasehold under a lease having a period of years  to  run
at  the time a mortgage is insured under this section of at least twenty
per centum greater duration than the remaining term  of  such  mortgage;
the  term  "first mortgage" means such first liens as are commonly given
to secure advances on, or the unpaid  purchase  price  of,  real  estate
under  the  laws  of the state, together with the credit instruments, if
any, secured thereby.
(h) "Mortgage insurance contracts". All contracts to insure  mortgages
entered  into  by  the predecessor corporation that are imposed upon and
assumed by the subsidiary  corporation  pursuant  to  paragraph  (d)  of
subdivision  two  of  this section and all contracts to insure mortgages
entered into by the subsidiary  corporation  with  respect  to  which  a
commitment to insure was issued by the predecessor corporation.
(i)   "Mortgage  insurance  fund".  The  mortgage  insurance  fund  as
established pursuant to subdivision twelve of this section.
(j) "Mortgage insurance fund requirement". As of any  particular  date
of  computation, an amount equal to the aggregate of (i) one hundred per
centum of  the  insured  amounts  due  and  payable  by  the  subsidiary
corporation  pursuant  to  mortgage  insurance  contracts,  plus (ii) an
amount equal to the greater of (A) seven million five  hundred  thousand
dollars  or  (B) twenty per centum of the insured amounts under mortgage
insurance contracts other than insured amounts which are due and payable
under subparagraph (i) of this paragraph, plus (iii) twenty  per  centum
of  the  amounts  to  be  insured  under  the  predecessor corporation's
commitments to  insure;  provided,  however,  that  notwithstanding  the
foregoing,  at  no  time  shall  the mortgage insurance fund requirement
exceed the aggregate of (1) insured  amounts  due  and  payable  by  the
subsidiary  corporation  pursuant  to mortgage insurance contracts, plus
(2) one hundred  per  centum  of  the  insured  amounts  under  mortgage
insurance contracts other than insured amounts which are due and payable
under  clause  (1) of this paragraph, plus (3) one hundred per centum of
the  amounts  to  be  insured  under   the   predecessor   corporation's
commitments to insure.
(k)  "Mortgagee".  The mortgage lender under a mortgage insured by the
predecessor corporation or insured pursuant to subdivision ten  of  this
section, and its successors and assigns.
(l) "Mortgage loan". A mortgage loan secured by a mortgage.
(m)  "Mortgagor".  The original borrower under a mortgage loan insured
by the predecessor corporation or insured pursuant to subdivision ten of
this section, and its successors and assigns.
(n) "Multi-family housing accommodation". A housing accommodation with
five or more dwelling units.
(o) "Operating expenses". All costs of  administering  the  subsidiary
corporation, including, but not limited to, salaries and wages, expenses
of  administering  staff  functions,  fees  of professional consultants,
legal fees, charges incurred for  servicing  of  mortgage  loans,  money
management  fees,  office  rents,  utility  charges,  costs of supplies,
furnishings, equipment, machinery and apparatus, maintenance and  repair
of  property,  payment to the corporation for services rendered, amounts
due and owing under contracts validly entered into  by  the  predecessor

corporation or the subsidiary corporation, other than mortgage insurance
contracts  and  housing  insurance  contracts,  respectively,  and other
expenses incurred in connection with any of the foregoing.
(p)  "Other  real  property".  Any  building,  structure or unimproved
property which is used or  occupied,  or  is  intended  to  be  used  or
occupied,  primarily  for  emergency, transitional or shelter housing, a
portion of which may also be used for  commercial  and  other  community
facilities  ancillary  to  such  use  provided  that,  the floor area of
above-ground commercial facilities shall not exceed one-quarter  of  the
above-ground  floor  area of such other real property (inclusive of such
commercial facilities).
(q)  "Predecessor  corporation".  The  New  York  city  rehabilitation
mortgage  insurance  corporation  created by section one of chapter nine
hundred twenty-four of  the  laws  of  nineteen  hundred  seventy-three,
being,  prior to repeal, article fourteen of the private housing finance
law.
(r) "Preservation loan". A  mortgage  loan  extended  by  a  financial
institution  with  a  term not to exceed forty years for the purposes of
refinancing existing indebtedness secured by one or more mortgages on  a
housing  accommodation or other real property located within the city of
New York and/or financing the acquisition of a housing accommodation  or
other  real  property  located  within  the  city  of New York and which
otherwise  complies  with  the  conditions   established   pursuant   to
subdivision ten of this section.
(s)  "Rehabilitation".  Repairs,  alterations  or  improvements  of  a
housing accommodation or other  real  property  designed  to  raise  the
housing  standards  therein  or,  in  the  case  of other real property,
designed to provide needed improvements  therein.  Rehabilitation  shall
also  include  the construction of a housing accommodation or other real
property.
(t) "Rehabilitation loan". A mortgage loan  extended  by  a  financial
institution  with a term not to exceed forty years which may include the
refinancing of existing indebtedness, if any, secured  by  one  or  more
mortgages  on  the  housing  accommodation  or other real property to be
rehabilitated, or financing the acquisition of the housing accommodation
or other real property to be rehabilitated, which housing  accommodation
or  other real property shall be located within the city of New York and
which otherwise complies with the  conditions  established  pursuant  to
subdivision  ten of this section, provided, however, that a sum equal to
at least twenty-five percent of the amount of the mortgage loan shall be
used for the cost of rehabilitation of, or construction of  improvements
on, a housing accommodation or other real property.
2. New York city residential mortgage insurance corporation. (a) There
is  hereby  established  a  public benefit corporation known as the "New
York city residential mortgage insurance corporation"  as  a  subsidiary
corporation   of   the  corporation.  The  purpose  of  such  subsidiary
corporation shall be to insure mortgage loans in order  to  promote  the
preservation  of neighborhoods which are blighted, are becoming blighted
or may become blighted, to discourage disinvestment  and  encourage  the
investment  of  mortgage  capital  in  such neighborhoods and to provide
safe, sanitary and affordable  housing  accommodations  to  persons  and
families  for  whom the ordinary operations of private enterprise cannot
supply such accommodations.
(b)  The  subsidiary  corporation  shall  be  the  successor  to   the
predecessor corporation.
(c) All property and rights of the predecessor corporation (other than
moneys  of  the predecessor corporation) are hereby passed to and vested
in the subsidiary corporation,  subject,  however,  to  all  outstanding

contracts  of  insurance,  commitments  to  insure  mortgages,  and  all
outstanding obligations of the predecessor corporation.  All  moneys  of
the predecessor corporation (including, but not limited to, amounts held
in  the  mortgage  insurance  fund established pursuant to section seven
hundred nine of this chapter, prior to said section being repealed)  and
all  moneys  held in the remic premium reserve fund established pursuant
to said section seven hundred nine shall be  transferred  to  the  city;
provided  that  as  a condition to said transfer, a like amount of money
shall be transferred from the corporation to the subsidiary  corporation
to  be deposited into the mortgage insurance fund, the housing insurance
fund and the remic premium reserve fund  (all  established  pursuant  to
subdivision  twelve  of  this  section)  in  such  amounts  as  shall be
determined by the subsidiary corporation, subject to the  provisions  of
paragraph (a) of subdivision twelve of this section.
(d)  All  debts,  liabilities, obligations, contracts, agreements, and
covenants of the predecessor corporation (including, but not limited to,
contracts of insurance and commitments to insure mortgages)  are  hereby
imposed  upon  and  shall  be assumed by the subsidiary corporation. All
persons having claims under any contracts of insurance or commitments to
insure mortgages entered  into  with  the  predecessor  corporation  may
enforce  those  claims  against  the  subsidiary corporation in the same
manner as they might have against the predecessor corporation,  and  the
rights  and  remedies of such persons shall not be limited or restricted
in any manner by this section. The foregoing notwithstanding, the debts,
liabilities, obligations, contracts, agreements  and  covenants  of  the
predecessor  corporation  shall not be imposed upon the corporation. All
persons having claims under any contracts of insurance or commitments to
insure mortgages entered into with  the  predecessor  corporation  shall
have  no  right  to  enforce  those  claims  in  any  manner against the
corporation.
(e) In continuing  the  functions  and  carrying  out  the  contracts,
obligations  and  duties  of the predecessor corporation, the subsidiary
corporation is hereby authorized to act in its own name or in  the  name
of the predecessor corporation as may be convenient or advisable.
(f)  All  regulations of the predecessor corporation shall continue to
be in effect as the regulations  of  the  subsidiary  corporation  until
amended,  supplemented  or  rescinded  by  the subsidiary corporation in
accordance with law.
3. Assistance; privileges. (a) The subsidiary corporation may  receive
moneys  from the corporation, the state, any public benefit corporation,
the city, the federal government or any other source for public purposes
set forth in this section.
(b) The subsidiary corporation may contract for and accept  any  gifts
or grants or loans of funds or property or financial or other aid in any
form  from  the  federal  government  or  any  agency or instrumentality
thereof, or from the state or any  agency  or  instrumentality  thereof,
including the city and the corporation, or from any other source, public
or  private,  and  to comply, subject to the provisions of this section,
with the terms and conditions thereof.
(c) The city and the corporation are each hereby  authorized  to,  but
neither is required to, make gifts, grants or loans of funds or property
or  financial or other aid in any form to the subsidiary corporation and
to enter into any contracts or  other  agreements  with  the  subsidiary
corporation,   on   such  terms  and  conditions  as  the  city  or  the
corporation, as applicable, and the  subsidiary  corporation  may  agree
upon,  all  in  furtherance  of  the  public  purposes set forth in this
section.
(d) All  domestic  corporations  or  associations  organized  for  the
purpose   of   carrying  on  business  in  this  state,  public  benefit
corporations, public employee  pension  funds  and  any  other  persons,
corporations or associations are hereby authorized to make contributions
to the subsidiary corporation.
(e)   The  subsidiary  corporation  shall  have  all  the  privileges,
immunities, tax exemptions and other exemptions of  the  corporation  to
the extent the same are not inconsistent with this section.
4.  Membership.  The  membership  of such subsidiary corporation shall
consist of  nine  members,  seven  of  whom  shall  be  members  of  the
corporation and two of whom shall be appointed by the mayor. The members
who  are not members of the corporation shall serve for terms ending two
and four years respectively from January first next succeeding the  date
of  their appointment. The successors of the members who are not members
of the corporation shall serve for terms of four years  each.  A  member
who  is  not  a member of the corporation shall continue in office until
his or her successor has been appointed and qualified. With  respect  to
any  member who is not a member of the corporation, the mayor shall fill
any vacancy which may occur by reason of death, resignation or otherwise
for the remaining unexpired term of such member. A member who is  not  a
member of the corporation may be removed by the mayor for cause, but not
without  an  opportunity  to  be  heard in person or by counsel, in such
member's defense, upon not less than ten days' notice. The powers of the
subsidiary corporation shall be vested in and exercised by no less  than
five  of  the members thereof then in office. The subsidiary corporation
may delegate to one or more of its members, or its officers, agents  and
employees,   such   duties  and  powers  as  it  may  deem  proper.  The
commissioner of the department of housing preservation  and  development
shall  serve as chairperson of the subsidiary corporation. The president
of  the  corporation  shall  serve  as  president  of   the   subsidiary
corporation.
5.  Compensation.  Notwithstanding any inconsistent provisions of this
or any other general, special or local law, no officer  or  employee  of
the corporation, the city or the state, or of any public corporation, as
defined  in  the  general  construction  law,  shall  be  deemed to have
forfeited or shall forfeit such person's office  or  employment  or  any
benefits  provided under the retirement and social security law or under
any public retirement system maintained by the state  or  by  the  civil
divisions thereof by reason of such person's acceptance of membership on
or by virtue of such person's being an officer, employee or agent of the
subsidiary  corporation. The members may engage in private employment or
in a profession or business, unless otherwise prohibited from  doing  so
by virtue of holding another public office, subject to the provisions of
article  eighteen of the general municipal law. For the purposes of such
article eighteen, the subsidiary corporation shall be  a  "municipality"
and a member shall be a "municipal officer". No member of the subsidiary
corporation  shall  receive  additional  compensation,  either direct or
indirect, other than reimbursement for  actual  and  necessary  expenses
incurred  in  the performance of such person's duties, by reason of such
person serving as a member of the subsidiary corporation.
6. Transfer of resources. The city and the corporation shall have  the
power  to,  but  shall  not  be obligated to, transfer to the subsidiary
corporation such agents, employees and facilities,  including  any  real
and/or  personal  property,  in  order to carry out the purposes of this
section.
7. Termination. The subsidiary corporation and its corporate existence
shall continue until terminated by law; provided, however, that no  such
law  shall  take effect so long as the subsidiary corporation shall have

contracts to insure mortgages (including  mortgage  insurance  contracts
and  housing  insurance contracts), commitments to insure, notes, bonds,
or other obligations outstanding, unless  adequate  provision  has  been
made  for  the payment thereof. Upon termination of the existence of the
subsidiary corporation all of its rights and properties  shall  pass  to
and be vested in the corporation.
8. Powers. The subsidiary corporation shall have the power:
(a) To sue and be sued;
(b) To have a seal and alter the same at pleasure;
(c) To make and alter by-laws for its organization;
(d)  To  adopt,  amend or rescind rules and regulations appropriate to
carry out  its  corporate  purposes,  including  rules  and  regulations
governing  the  use of its property and facilities and to establish such
requirements and enter into such agreements to achieve the objectives of
this section;
(e) To make and execute contracts and all other instruments  necessary
or  convenient  for  the exercise of its powers and functions under this
section;
(f) To acquire, hold and dispose of real and/or personal property  for
its corporate purposes;
(g)  To engage the services of private consultants on a contract basis
for rendering professional and technical assistance and advice;
(h) To appoint officers, agents and employees, prescribe their  duties
and qualifications and fix their compensation;
(i) To invest any funds, or other moneys under its custody and control
in the same manner as the corporation;
(j)  To  establish  and  levy  fees and charges in connection with the
processing of  applications  for  mortgage  insurance  and  fix  premium
charges for mortgage insurance;
(k)  To  enter  into  commitments to insure mortgages and contracts of
insurance and enter into any additional  agreements  as  the  subsidiary
corporation deems appropriate to further the objectives of this section;
(l)  To  fulfill  its  obligations  and  enforce  its rights under any
contract of insurance, or commitment to insure so furnished as  provided
in  this section and such rules and regulations as may be adopted by the
subsidiary corporation;
(m) To pay, pursue to final collection, compromise, waive  or  release
any right, title, claim, lien or demand, however acquired, including any
equity or right of redemption;
(n)  To  foreclose  any  mortgage in default or commence any action to
protect or enforce any right conferred upon it  by  any  law,  mortgage,
contract  or  other agreement, and to bid for and purchase such property
at any foreclosure or at any other sale, or otherwise to acquire or take
possession of any such property;
(o) To deal with, hold, administer, manage, rent,  repair,  insure  or
sell, lease or otherwise dispose of any property conveyed to or acquired
by  the  subsidiary  corporation  and  to enter into agreements with the
state,  the  city,  or  any  person,  firm,   entity,   partnership   or
corporation, either public or private, with regard thereto;
(p)  To  procure  insurance  against  any  loss in connection with its
property and other assets and to procure reinsurance in connection  with
its  obligations, all in such amounts and from such insurers as it deems
necessary or desirable;
(q) To consent to the modification, with respect to rate of  interest,
time of payment of any installment of principal or interest, security or
any other term, of any mortgage, mortgage loan, contract or agreement of
any  kind  which  the subsidiary corporation has insured or to which the
subsidiary corporation is a party;
(r) To sell,  at  public  or  private  sale,  any  mortgage,  mortgage
participation or other obligation held by the subsidiary corporation;
(s) To procure cash equivalents for deposit in its funds;
(t)  To  enter into co-insurance agreements with any entity authorized
by law to provide mortgage insurance with respect  to  property  located
within  the city of New York, including, but not limited to the state of
New York mortgage agency and the United States department of housing and
urban development;
(u) To do any and all things necessary or convenient to carry out  its
purposes  and  exercise  the  powers expressly given and granted in this
section.
9.  Classification   of   housing   accommodations.   The   subsidiary
corporation  may  classify  housing  accommodations  within the city and
approve any of such classes as eligible for insurance pursuant  to  this
section  and  enact  separate  guidelines dealing with the provision and
extent of such insurance.
10. Insurance of mortgage loans. (a)  The  subsidiary  corporation  is
authorized,   subject  to  the  provisions  of  this  section,  to  make
commitments to insure and to contract to insure mortgage loans  eligible
for insurance hereunder.
(b)  The  subsidiary  corporation  shall  limit  its  insurance  on  a
rehabilitation or preservation loan to an amount not in excess of  fifty
per centum of the outstanding principal indebtedness, provided, however,
that  the  subsidiary  corporation may insure an amount not in excess of
seventy-five per centum of the outstanding principal indebtedness  of  a
rehabilitation  loan  if it shall find that the extent of rehabilitation
is sufficient to justify such additional  insurance,  provided  further,
however,  that  the  subsidiary  corporation may insure an amount not to
exceed the full outstanding principal indebtedness of  a  rehabilitation
or  preservation  loan when such mortgage loan has been made by a public
benefit corporation of the  state  of  New  York  which  public  benefit
corporation  has issued or will issue bonds or notes, some or all of the
proceeds of which bonds or notes were used or will be used to make  such
mortgage  loan,  or  when  the  mortgage  loan has been made by a public
employee pension fund. The foregoing notwithstanding,  the  sum  of  the
percentage  of  any  mortgage loan insured by the subsidiary corporation
and the percentage of such loan insured or to be insured  by  any  other
party  shall  not  exceed  one  hundred  per  centum  of the outstanding
principal indebtedness of such mortgage loan.
(c) The subsidiary corporation shall not issue a commitment to  insure
or a housing insurance contract unless upon the issuance thereof amounts
on deposit in the housing insurance fund will at least equal the housing
insurance fund requirement.
(d)  Except  for  mortgage insurance contracts and except as otherwise
provided  in  paragraph  (e)  of  this   subdivision,   the   subsidiary
corporation  shall  not issue a commitment to insure nor shall it insure
any mortgage loan unless it shall first find (i) that the property which
is the security for such mortgage loan  is  located  in  a  neighborhood
within  the  city of New York characterized by a deficiency of available
mortgage financing; (ii) that such deficiency has caused or threatens to
cause  undermaintained  and  deteriorating  housing  accommodations  and
substandard  and  unsanitary  neighborhoods;  (iii) that the granting of
such mortgage loan will aid in the preservation or rehabilitation of the
neighborhood in which such  property  is  located;  (iv)  that,  if  the
property  which  is  the  security  for such mortgage loan is other real
property, the granting of such mortgage loan will assist  in  preventing
the  deterioration  of  residential housing in the neighborhood in which
such property is located;  and  (v)  that  the  property  which  is  the

security  for  such loan meets such other requirements as the subsidiary
corporation may from time to time establish by guidelines adopted by the
subsidiary  corporation.  Any  such  determination  by  the   subsidiary
corporation  shall  be  conclusive and final and shall not be subject to
review of any kind or nature or in any manner whatsoever and  shall  not
give rise to any liability on the part of the subsidiary corporation.
(e)  The  subsidiary  corporation may issue a commitment to insure and
may insure any mortgage loans, notwithstanding the criteria set forth in
subparagraph  (i),  (ii),  (iii)  or  (iv)  of  paragraph  (d)  of  this
subdivision  provided  that  it  shall  find  the  property which is the
security for such mortgage loan or mortgage loans is either: (i) located
within the city of New York in an empire  zone  designated  pursuant  to
article  eighteen-B  of  the general municipal law, or (ii) will provide
safe, sanitary and affordable housing for persons and families for  whom
the  ordinary  operations  of  private  enterprise  cannot  supply  such
housing, or (iii) the entity providing the mortgage financing was or  is
created  by  local,  state  or  federal legislation and certifies to the
subsidiary corporation that the housing  accommodations  or  other  real
property  are  located  within the city of New York and meet the program
criteria  applicable  to  such  entity.  In  addition,  the   subsidiary
corporation   may   enter   into   any   mortgage   insurance  contract,
notwithstanding the criteria set forth in subparagraph (i), (ii),  (iii)
or  (iv) of paragraph (d) of this subdivision provided that with respect
to such mortgage insurance contract, a commitment to insure  shall  have
been previously issued by the predecessor corporation.
(f)  The  subsidiary  corporation may issue a commitment to insure and
may insure an existing mortgage  loan,  when  an  application  for  such
mortgage  insurance  has  been  submitted  prior  to  the making of such
mortgage loan,  and  significant  circumstances  beyond  the  reasonable
control  of  the  mortgagor  and mortgagee necessitate the making of the
mortgage loan prior to the issuance of the commitment to insure and when
it is determined by the subsidiary corporation that such  mortgage  loan
would  not have been made except for the reasonable expectation that the
subsidiary corporation would insure the mortgage loan.
(g) To be eligible for insurance under this section, a  mortgage  loan
shall  be  a preservation loan and/or a rehabilitation loan and (i) bear
interest,  exclusive  of  premium  charges  fixed  by   the   subsidiary
corporation,  at a rate not in excess of the rate of interest authorized
by law and not in excess of a maximum rate of  interest  established  by
the   subsidiary   corporation   from   time  to  time.  In  making  its
determination of  appropriate  maximum  interest  rate,  the  subsidiary
corporation  shall  take into account the rates of interest prevalent in
the mortgage  market,  current  data  on  secondary  market  yields  and
discount  and/or  premium levels; (ii) unless the subsidiary corporation
in  its  sole  discretion  shall  otherwise   determine,   provide   for
substantially  equal  and  constant  periodic  payments of principal and
interest in amounts sufficient to  pay  all  interest  and  effect  full
repayment  of  principal  within  the  term  of the mortgage loan; (iii)
contain terms  with  respect  to  the  prepayment,  insurance,  repairs,
alterations,  payment  of  taxes,  special assessments, service charges,
default  reserves,   delinquency   charges,   foreclosure   proceedings,
additional and secondary liens, and such other matters as the subsidiary
corporation  may  in  its  discretion  prescribe; (iv) be accompanied by
certificates, issued by such  officers  of  the  mortgagee,  independent
appraisers  or  other persons as the subsidiary corporation may require,
certifying that: (A) where appropriate, the annual income to be  derived
from  the  property  equals not less than one hundred five per centum of
the annual charges  and  expenses,  including  provision  for  reserves,

satisfactory  to  the  subsidiary  corporation,  for the amortization of
subordinate mortgage loans over the remaining  terms  of  such  mortgage
loans regardless of whether the terms of such subordinate mortgage loans
include  scheduled  amortization  of principal; (B) the remaining useful
life of the property is greater than the term of the mortgage;  and  (C)
the  housing  accommodation  or other real property does not contain any
substantial violations of the housing maintenance code or  the  multiple
dwelling  law,  except  that  in the case of a mortgage loan made to the
owner of a housing accommodation or other real property  containing  any
such  violations,  the  subsidiary  corporation  may insure or commit to
insure such mortgage loan if the mortgagee and the owner have  submitted
a  plan,  satisfactory  to  the subsidiary corporation to eliminate such
violations; and (v) satisfy such additional terms and conditions as  the
subsidiary corporation may prescribe.
(h)  In addition to the conditions set forth in paragraphs (d) through
(g) in this subdivision, the subsidiary corporation shall not insure nor
issue a commitment to insure any rehabilitation  loan  unless  it  shall
find  (i) that rehabilitation is necessary to upgrade the property, (ii)
that rehabilitation will not necessitate more than a minimum  amount  of
relocation  of the residents of any housing accommodation and (iii) that
the rehabilitation undertaken with the proceeds  of  the  rehabilitation
loan has been completed.
(i)   A   financial  institution  may  request  insurance  by  written
application to the subsidiary  corporation  in  such  form  and  manner,
together   with  such  information  and  documents,  as  the  subsidiary
corporation may prescribe. No application shall be complete  unless  and
until  the financial institution has paid such processing fees and other
charges  as  the  subsidiary  corporation  may  impose   in   connection
therewith.  The  subsidiary  corporation shall signify its acceptance of
such application for insurance by issuance of a commitment to insure  or
a contract of insurance.
(j)  The subsidiary corporation shall not issue a commitment to insure
a mortgage loan extended by the corporation unless  such  commitment  to
insure  is  approved  by at least two members of a committee composed of
the chairperson of the subsidiary corporation and  the  members  of  the
subsidiary corporation who are not members of the corporation.
11.  Payment  of insurance. The subsidiary corporation shall establish
procedures to be followed by a mortgagee in the event of a default under
the terms  of  any  mortgage  insured  by  the  subsidiary  corporation,
provided,  however,  any  modification to such procedures (other than to
cure any ambiguity, defect or omission) shall apply  only  to  mortgages
for  which commitments have been issued after the effective date of such
modification. The subsidiary corporation may establish prerequisites for
payment of an insurance claim, including, but not limited to,  requiring
the mortgagee to take such actions with respect to the property securing
the defaulted mortgage as may be specified by the subsidiary corporation
to  be  satisfactory evidence of a continuing default, including but not
limited to the following actions: (i) becoming lawfully the mortgagee in
possession thereof; (ii) causing a receiver  to  be  appointed  of  such
property;  (iii) obtaining voluntary conveyance of the mortgagor's right
and title to such property; or (iv) obtaining by foreclosure  clear  and
unencumbered  title  to  such  property,  all  in  such  manner  as  the
subsidiary corporation may require.  Following  submission  of  a  valid
claim,  the  subsidiary  corporation shall pay an amount which shall not
exceed the lesser of: (A) the then outstanding principal amount  of  the
mortgage multiplied by the per centum of such outstanding amount insured
by  the  subsidiary  corporation plus that per centum of the mortgagee's
cost arising from the default, inclusive of public liens and  delinquent

and  unpaid interest, all as the subsidiary corporation may from time to
time allow, which per centum shall not exceed  the  per  centum  of  the
outstanding principal indebtedness insured by the subsidiary corporation
or  (B) the insured amount of the mortgage loan at the date of execution
of the contract of insurance or its latest  amendment,  if  any,  except
that the subsidiary corporation shall pay the greater of the two amounts
on  claims  by  a  public  employee  pension fund or by a public benefit
corporation from mortgage loans financed by the sale of notes  or  bonds
issued  by  said corporation and such amount payable may, if so provided
in the contract of insurance, include accrued interest to  the  date  of
redemption  for  such  bonds  or notes and any cost associated with such
redemption, provided that no more than the actual loss suffered by  such
public  benefit  corporation  or  public  employee pension fund shall be
paid. Such payment may be made by the subsidiary corporation in  a  lump
sum,  or  in  partial  payments  made within such period of time, not in
excess of two  years,  as  may  be  agreed  to  between  the  subsidiary
corporation  and  the mortgagee, all in accordance with procedures to be
established by the subsidiary corporation.  The  subsidiary  corporation
shall  have  the power to bid for and purchase the property securing the
defaulted mortgage at any foreclosure or other sale of such property, or
to otherwise acquire or take possession of such property  in  accordance
with  other  provisions  of  law.  In  the  event  of any such purchase,
acquisition, or taking of possession, the subsidiary  corporation  shall
have  the power to complete, administer, sell, dispose of, and otherwise
deal with such property, in such manner as may be necessary or desirable
to protect the interests of the subsidiary corporation.
12. Mortgage insurance fund, housing insurance fund and remic  premium
reserve  fund. (a) The subsidiary corporation shall create and establish
a fund to be known as the "mortgage insurance fund" which shall be  used
as a revolving fund for carrying out the provisions of this section with
respect  to  mortgage  insurance contracts and shall, upon its creation,
pay into such fund moneys made available to the  subsidiary  corporation
from  the  corporation in an amount equal to the mortgage insurance fund
requirement as of such date for the purpose  of  such  fund,  and  shall
thereafter,  pay  into  such  fund,  upon  receipt,  (i) such portion of
mortgage insurance contract premium payments in an amount equal  to  the
amount  necessary  to  be  transferred to the mortgage insurance fund in
order that the amount on  deposit  therein  be  equal  to  the  mortgage
insurance  fund requirement (or such lesser amount as may be available);
(ii) such portion of the proceeds received by the subsidiary corporation
in connection with the exercise of such subsidiary corporation's  rights
under  any  mortgage insurance contract in an amount equal to the amount
necessary to be transferred to the mortgage insurance fund in order that
the amount on deposit therein be equal to the  mortgage  insurance  fund
requirement  (or  such  lesser  amount  as  may be available); (iii) any
moneys appropriated, paid or otherwise made available by the city or the
corporation for the purpose of such fund;  and  (iv)  any  other  moneys
which  may  be  made  available  to  the  subsidiary corporation for the
purpose of such fund from any other  source.  All  moneys  held  in  the
mortgage  insurance fund, except as hereinafter provided, shall be used,
as required, solely for the  payment  of  the  subsidiary  corporation's
liabilities   arising   from  mortgage  insurance  contracts;  provided,
however, that moneys in such fund shall not be  withdrawn  therefrom  at
any  time in such amount as would reduce the amount of such fund to less
than the mortgage insurance fund requirement, except for the purposes of
paying such liabilities, as the same become due and for the  payment  of
which  other moneys of the subsidiary corporation are not available. Any
income or interest earned by, or increment to,  the  mortgage  insurance

fund  due  to  the  investment  thereof  or  any amount in excess of the
mortgage insurance  fund  requirement  shall  be  transferred  at  least
annually by the subsidiary corporation to the remic premium reserve fund
or,  at the written direction of the chairperson, to such other funds or
accounts of the subsidiary corporation to the extent it does not  reduce
the  amount  of the mortgage insurance fund below the mortgage insurance
fund requirement.
(b) The subsidiary corporation shall create and establish a fund to be
known as the "housing insurance fund" which shall be used as a revolving
fund for carrying out the provisions of this  section  with  respect  to
housing  insurance contracts and shall, upon its creation, pay into such
fund any moneys or cash equivalents made  available  to  the  subsidiary
corporation from the corporation for the purpose of such fund, and shall
thereafter,  pay  into  such  fund,  upon  receipt,  (i) such portion of
housing insurance contract premium payments in an amount  equal  to  the
amount  necessary  to  be  transferred  to the housing insurance fund in
order that the amount  on  deposit  therein  be  equal  to  the  housing
insurance  fund requirement (or such lesser amount as may be available);
(ii) such portion of the proceeds received by the subsidiary corporation
in connection with the exercise of such subsidiary corporation's  rights
under  any  housing  insurance contract in an amount equal to the amount
necessary to be transferred to the housing insurance fund in order  that
the  amount  on  deposit  therein be equal to the housing insurance fund
requirement (or such lesser amount  as  may  be  available);  (iii)  any
moneys   or  cash  equivalents  appropriated,  paid  or  otherwise  made
available by the city, the federal government or the corporation for the
purpose of such fund; and (iv) any  other  moneys  or  cash  equivalents
which  may  be  made  available  to  the  subsidiary corporation for the
purpose of  such  fund  from  any  other  source.  All  moneys  or  cash
equivalents  held  in  the housing insurance fund, except as hereinafter
provided, shall be used, as required, solely  for  the  payment  of  the
subsidiary  corporation's  liabilities  arising  from  housing insurance
contracts; provided, however, that moneys or cash  equivalents  in  such
fund  shall  not  be  withdrawn  therefrom at any time in such amount as
would reduce the amount of such fund to less than the housing  insurance
fund  requirement, except for the purpose of paying such liabilities, as
the same become due and for the payment of which  other  moneys  of  the
subsidiary  corporation are not available. Any income or interest earned
by, or increment to, the housing insurance fund due  to  the  investment
thereof   or  any  amount  in  excess  of  the  housing  insurance  fund
requirement shall be transferred at least  annually  by  the  subsidiary
corporation  to  the  remic  premium  reserve  fund  or  at  the written
direction of the chairperson, to such other funds  or  accounts  of  the
subsidiary  corporation  to  the extent it does not reduce the amount of
the housing insurance fund below the housing insurance fund requirement.
(c)  The  subsidiary  corporation  shall  create  and  establish  such
accounts  within  the  housing  insurance  fund  as  may be necessary or
desirable for its corporate purposes.
(d) The subsidiary corporation shall create and establish a fund to be
known as the "remic premium reserve fund" for the purpose  of  providing
for payment of the subsidiary corporation's liabilities arising from its
operations,  its  mortgage insurance contracts and its housing insurance
contracts and shall, upon its creation, pay into  such  fund  moneys  or
cash  equivalents  made available to the subsidiary corporation from the
corporation for the purpose of such fund, and shall thereafter, pay into
such fund, upon receipt, (i) the balance of  the  premium  payments,  if
any,  received  by  the  subsidiary corporation with respect to mortgage
insurance contracts and housing insurance  contracts  after  making  the

deposits described in subparagraph (i) of paragraph (a) and subparagraph
(i) of paragraph (b) respectively, of this subdivision; (ii) the balance
of  any  proceeds  received  by the subsidiary corporation in connection
with  the  exercise  of  such  subsidiary corporation's rights under any
mortgage insurance contract or housing insurance contract  after  making
the  deposits  described  in  subparagraph  (ii)  of  paragraph  (a) and
subparagraph (ii) of paragraph (b)  respectively  of  this  subdivision;
(iii)  any  moneys  or  cash equivalents appropriated, paid or otherwise
made available by the city, the federal government  or  the  corporation
for  the  purpose  of  such  fund;  and  (iv)  any  other moneys or cash
equivalents which may be made available to  the  subsidiary  corporation
for the purpose of such fund from any other source.
(e)  The  subsidiary  corporation  shall  create  and  establish  such
accounts within the remic premium reserve fund as may be  necessary  for
its corporate purposes.
(f)  Except as otherwise provided in this section, all moneys received
by the subsidiary corporation shall be deposited in  the  remic  premium
reserve fund.
(g)  If  the  remic premium reserve fund is funded in whole or in part
with cash, the moneys in such fund shall be deposited  in  one  or  more
banks  or  trust  companies  designated,  in  manner provided by law, as
depositories of the funds of the subsidiary corporation. The  subsidiary
corporation  may  invest  any  moneys in such fund in the same manner as
moneys  of  the  corporation  may  be  invested,  provided   that   such
obligations  shall  be  payable  within such time as the proceeds may be
needed to meet expenditures estimated to be incurred by  the  subsidiary
corporation.  Any  interest earned or capital gain realized on the money
so deposited or invested shall accrue to and become part of  such  fund.
The  separate  indentity  of  such  fund shall be maintained whether its
assets consist of cash or investments or both.
(h) The subsidiary corporation shall transfer from the  remic  premium
reserve   fund  such  moneys  as  the  subsidiary  corporation,  by  its
chairperson, shall certify are required for the  subsidiary  corporation
to  pay  its operating expenses, to pay any liabilities arising from the
subsidiary  corporation's  mortgage  insurance  contracts  and   housing
insurance  contracts, and to restore the mortgage insurance fund and the
housing insurance fund to the mortgage insurance  fund  requirement  and
housing insurance fund requirement, respectively.
(i)  The  subsidiary corporation shall keep a separate account for the
remic premium reserve fund. Such account shall show  (i)  the  date  and
amount  of  each sum paid into the fund, (ii) the interest earned by the
fund, (iii) the capital gains or  losses  resulting  from  the  sale  of
investments  of  the fund, (iv) the interest or capital gains which have
accrued to the fund, (v) the amount and date of each withdrawal from the
fund, and (vi) the assets  of  the  fund  indicating  the  cash  balance
therein and a schedule of the amounts invested.
(j)  In  computing  the  amount  of  the  mortgage insurance fund, the
housing insurance fund and  the  remic  premium  reserve  fund  for  the
purposes  of  this section, securities in which all or a portion of such
funds shall be invested shall be valued at par, if purchased at par,  or
if  purchased  at  other  than par, at amortized value. Amortized value,
when used with respect to securities purchased at a premium above  or  a
discount below par or if purchased at par, or if purchased at other than
par,  shall mean the value as of any given date obtained by dividing the
total premiums or discount at which such securities  were  purchased  by
the number of interest payments remaining to maturity on such securities
after  such  purchase and by multiplying the amount so calculated by the
number of interest payment dates having passed since the  date  of  such

purchase;  and  (i)  in the case of securities purchased at a premium by
deducting the product thus obtained from the purchase price, and (ii) in
the case of securities purchased at a discount  by  adding  the  product
thus obtained to the purchase price.
(k)  The  subsidiary corporation shall create and establish such other
fund or funds as  may  be  necessary  or  desirable  for  its  corporate
purposes.
13.  Charges  and  fees.  (a)  The  subsidiary corporation shall fix a
premium charge for its insurance of mortgages pursuant to  this  section
which  shall  not  be  less  than  the  minimum amount nor more than the
maximum amount that the state of New York mortgage agency  is  permitted
to charge pursuant to applicable provisions of law.
(b)  The  subsidiary  corporation  may  establish  and levy such other
charges and fees in connection with applications for mortgage  insurance
and insurance commitments as it may deem appropriate and necessary.
(c)  Such  premium  charges  and other charges shall be payable by the
mortgagor in cash in such manner as may be prescribed by the  subsidiary
corporation.
(d)  Such  premium  charges  and  other  charges and fees shall not be
deemed to be interest for the purposes of section 5-501 of  the  general
obligations law.
14.   Assistance   by  the  corporation.  The  corporation  is  hereby
authorized to perform such functions and services in connection with any
lawful corporate purpose of  the  subsidiary  corporation  as  shall  be
requested  by  the  subsidiary  corporation.  The subsidiary corporation
shall  pay  to  the  corporation  from  any  moneys  of  the  subsidiary
corporation available for such purposes such amounts as are necessary to
pay  the  corporation  for  the  services  rendered  by  the corporation
pursuant to this section.
15.  Assistance  by  the  department  of  housing   preservation   and
development.  The  commissioner  of housing preservation and development
and the department of housing preservation and  development  are  hereby
authorized to perform such functions and services in connection with any
lawful  corporate  purpose  of  the  subsidiary  corporation as shall be
requested by the  subsidiary  corporation.  The  subsidiary  corporation
shall pay to the department of housing preservation and development from
any  moneys  of  the  subsidiary corporation available for such purposes
such amounts as are necessary to reimburse  the  department  of  housing
preservation  and development for the services provided pursuant to this
section.
16. Annual report. The subsidiary  corporation  shall  submit  to  the
mayor,  the  comptroller,  the director of management and budget and the
corporation within ninety days after the  end  of  its  fiscal  year,  a
complete  and  detailed  report  setting  forth:  (i) its operations and
accomplishments; (ii) its receipts and expenditures during  such  fiscal
year in accordance with the categories or classifications established by
the   subsidiary  corporation  for  its  operating  and  capital  outlay
purposes; and (iii) its assets and liabilities at the end of its  fiscal
year,  including  a schedule of mortgages which have been insured during
such year, the status of the mortgage insurance fund, housing  insurance
fund  and  other  reserve or special funds established by the subsidiary
corporation.
17. Moneys of the  subsidiary  corporation.  (a)  All  moneys  of  the
subsidiary  corporation,  except  as otherwise authorized or provided in
this section, shall be deposited as soon as practicable  in  a  separate
account or accounts in banks or trust companies organized under the laws
of  the  state  or  national  banking  association,  in  each case doing
business in the city. The moneys in such accounts shall be paid  out  on

checks  signed by such officer or employee of the subsidiary corporation
as the subsidiary corporation shall  authorize.  All  deposits  of  such
moneys  shall,  if required by the subsidiary corporation, be secured by
obligations  of  the  United  States or of the state or of the city of a
market value equal at all times to the amount of  the  deposit  and  all
banks  and trust companies are authorized to give such security for such
deposits.
(b) The subsidiary corporation shall prescribe a system of accounts.
(c)  The  comptroller,  or  the   comptroller's   legally   authorized
representative,  is hereby authorized and empowered from time to time to
examine the books and accounts of the subsidiary  corporation  including
its  receipts,  disbursements,  contracts, reserve funds, sinking funds,
investments, and any other matters relating to its  financial  standing.
Such  an examination shall be conducted by the comptroller at least once
in every five years; the comptroller is authorized, however,  to  accept
from  the  subsidiary  corporation,  in  lieu of such an examination, an
external examination of its books and accounts made at  the  request  of
the subsidiary corporation.
(d)  The  subsidiary  corporation  shall  submit  to  the  mayor,  the
comptroller and the  corporation  within  thirty  days  of  the  receipt
thereof  by  the  subsidiary  corporation  a copy of the report of every
external examination  of  the  books  and  accounts  of  the  subsidiary
corporation  other  than copies of the reports of such examinations made
by the comptroller.
18. Rentals. Notwithstanding the  provisions  of,  or  any  regulation
promulgated  pursuant  to,  the  emergency housing rent control law, the
local emergency housing rent control act or local law  enacted  pursuant
thereto, all dwelling units in a multiple dwelling the rehabilitation of
which  commenced  after  July  first, nineteen hundred seventy-seven and
which  is  financed  by  a  mortgage  loan  insured  by  the  subsidiary
corporation  (including,  but  not  limited  to,  mortgage loans insured
pursuant  to  mortgage  insurance  contracts   and   housing   insurance
contracts), except for dwelling units occupied by reason of ownership of
stock  in  a  cooperative  and except for dwelling units that constitute
condominiums, shall be subject to the rent stabilization law of nineteen
hundred  sixty-nine,  beginning  immediately  after  initial  rents,  as
established  under  applicable  provisions of this chapter, section four
hundred twenty-one-a of the real property tax law, section four  hundred
eighty-nine  of  the  real  property  tax law and/or subparagraph (m) of
paragraph one of subdivision g of section 26-405 of  the  administrative
code of the city of New York for such dwelling units to become effective
on  the  basis  of  such  rehabilitation,  provided that any occupant in
possession of a dwelling unit that first becomes  subject  to  the  rent
stabilization  law  of  nineteen  hundred  sixty-nine  pursuant  to this
section shall be offered a two-year lease notwithstanding  any  contrary
provisions   of,   or   regulations   adopted  pursuant  to,  such  rent
stabilization law, at the initial rent  established  for  such  dwelling
unit  and  provided  further  that such dwelling units, other than those
dwelling units,  the  initial  rents  of  which  are  established  under
subparagraph  (m) of paragraph one of subdivision g of section 26-405 of
the administrative code of the city of New York, shall remain subject to
the rent stabilization law in accordance with  the  provisions  of  this
chapter,  section four hundred twenty-one-a of the real property tax law
and/or section four hundred eighty-nine of the real property tax law  as
the case may be. Except to the extent to which dwelling units, which are
controlled  under  other  provisions  of law, become subject to the rent
stabilization  law  of  nineteen  hundred  sixty-nine  pursuant  to  the
preceding  sentence,  no  dwelling unit shall become subject to the rent

stabilization law solely by reason of insurance of a  mortgage  loan  by
the subsidiary corporation.
19.  Employees  of the subsidiary corporation. (a) Notwithstanding any
inconsistent provisions of this section, the appointment  and  promotion
of  all employees of and for the subsidiary corporation shall be made in
accordance with the provisions  of  the  civil  service  law  under  the
jurisdiction  of  the city civil service commission and the compensation
for such employees shall be fixed by the subsidiary corporation.
(b) The city, the corporation and the  predecessor  corporation  shall
have the power to provide for the transfer to the subsidiary corporation
of  agents, employees and facilities of the city, the corporation or the
predecessor corporation, as the case may be, to  enable  the  subsidiary
corporation  to  fulfill  its corporate purposes. Employees of the city,
the corporation or the predecessor corporation to be transferred to  the
subsidiary  corporation  pursuant  to this section shall be eligible for
such transfer and appointment to offices and positions of the subsidiary
corporation without further examination, and all such employees who have
been appointed to positions in  city  service  in  accordance  with  the
provisions  of  the  civil service law under the rules of the city civil
service commission shall have the same status with  respect  thereto  in
the  service  of the subsidiary corporation as they had in city service.
Employees who are members or beneficiaries of any  existing  pension  or
retirement  system  shall  continue  to  have  such  rights, privileges,
obligations or status with respect to such  system  or  systems  as  are
prescribed  by  law  on the date this section takes effect, and all such
employees who have been  appointed  to  positions  in  city  service  in
accordance  with the provisions of the civil service law under the rules
of the city civil service commission shall have  the  same  status  with
respect  thereto  in  the service of the corporation as they had in city
service.
20. Subsidiaries; how  created.  (a)  The  subsidiary  corporation  by
resolution  may  direct  any  of  its  members, officers or employees to
organize a subsidiary of the subsidiary  corporation  whenever,  in  the
sole  discretion  of the subsidiary corporation, it has become necessary
to acquire one or more housing accommodations or other real property  in
the  case  of sale under foreclosure or in lieu of foreclosure and it is
beneficial to effectuate the purpose of this chapter for the  subsidiary
of   the   subsidiary   corporation   to  hold  title  to  such  housing
accommodations or other real property.
(b) Each such subsidiary of the subsidiary corporation shall be wholly
owned by the subsidiary corporation and shall be organized  pursuant  to
the  business  corporation  law,  the  not-for-profit corporation law or
article two or article eleven of this chapter.
(c) The subsidiary corporation may transfer to any subsidiary  of  the
subsidiary  corporation  any money, real and/or personal property or may
convey to it any housing accommodation or other real property  in  order
to  carry  out the purposes of this article. Each such subsidiary of the
subsidiary corporation shall have all the  privileges,  immunities,  tax
exemptions  and  other  exemptions  of the subsidiary corporation to the
extent the same are  not  inconsistent  with  the  statute  or  statutes
pursuant  to  which  such  subsidiary  of the subsidiary corporation was
incorporated. Except as may be inconsistent with the provisions of  this
article,  such  subsidiary,  if  organized  pursuant  to  article two or
article eleven of this chapter, shall have all  the  rights  and  powers
granted  to  housing  companies by this chapter and by any other statute
pursuant to which such subsidiary  of  the  subsidiary  corporation  was
organized.
(d)  No  member or officer of the subsidiary corporation shall receive
any additional compensation,  either  direct  or  indirect,  other  than
reimbursement   for  actual  and  necessary  expenses  incurred  in  the
performance of such person's duties, by reason of such person serving as
a  member,  director,  trustee  or  officer  of  any  subsidiary  of the
subsidiary corporation.