Court Opinions

State Laws

US Code

US Constitution

New York Banking Law Section 6-a - Investment In Obligations Of Certain Persons Sixty-five Years Of Age Or Over Incurred To Satisfy Real Property Tax Indebtedness.

Legal Research Home > New York Lawyer > Banking > New York Banking Law Section 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 banking board 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 banking board,  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.

Last modified: August 26, 2006