Requires a lender to provide a real property loan applicant with a copy of the appraisal required by law to be available at time of closing if requested in writing at least 10 days prior thereto.
TITLE OF BILL: An act to amend the real property law, in relation to real property appraisals in certain cases
SUMMARY: This bill would amend Real Property Law §254-C(1) to require that a copy of any real estate appraisal required by a lender as part of a mortgage application be available to the applicant at the closing, if requested in writing at least ten days prior to the closing.
JUSTIFICATION: In 1983, the Legislature enacted Section 254-c of the Real Property Law to give residential mortgage applicants the right to a copy of any real estate appraisal of the property involved. Under this law, applicants are entitled to a copy of the real estate appraisal provided that: 1) the lender mandates an appraisal as part of the mortgage application process, 2) the applicant is required to pay for the appraisal and 3) the applicant requests a copy of the appraisal in writing.
Chapter 245 of the Laws of 1983 was enacted in response to the failure of many lending institutions to provide borrowers with copies of real estate appraisals, even though the lender required them and required the borrower to bear the cost of securing these appraisals. By giving such borrowers a right to a copy of the appraisal Chapter 245 sought to correct this situation.
Unfortunately, the new law failed to specify a time period for compliance. Although written requests for copies of real estate appraisals may have been made prior to the closing, the appraisal itself need not be made available at the closing.
This situation is further compounded by the fact that many major lenders may take the mortgage application in one branch office, process the application in another part of the State and eventually store all the mortgage materials in yet another part of the State. This makes securing a copy of the appraisal very difficult for some borrowers.
This bill would remedy this situation by requiring lenders to have a copy of the appraisal at the closing, provided that the borrower makes a written request at least ten days prior to the closing.
FISCAL IMPLICATIONS: None.
EFFECTIVE DATE: This act shall take effect on the one hundred twentieth day after it shall have become a law.
STATE OF NEW YORK ________________________________________________________________________ 2028 2011-2012 Regular Sessions IN SENATE January 18, 2011 ___________Introduced by Sen. KRUGER -- read twice and ordered printed, and when printed to be committed to the Committee on Judiciary AN ACT to amend the real property law, in relation to real property appraisals in certain cases THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Subdivision 1 of section 254-c of the real property law, as amended by chapter 80 of the laws of 1996, is amended to read as follows: 1. Any lender who requires an applicant for a loan or forbearance, which is to be secured primarily by an interest in real property, to bear the cost of either an appraisal of said property or the cost of obtaining a consumer report subject to the provisions of article twen- ty-five of the general business law as a condition to the processing of the application or the granting of the loan or forbearance, shall, upon the written request of such applicant, provide to him OR HER a copy of said appraisal or consumer report as the case may be, at no additional cost. IN THE EVENT SUCH WRITTEN REQUEST IS RECEIVED BY THE LENDER AT LEAST TEN DAYS PRIOR TO THE CLOSING, A COPY OF THE APPRAISAL SHALL BE AVAILABLE TO THE APPLICANT AT THE CLOSING. S 2. This act shall take effect on the one hundred twentieth day after it shall have become a law.EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD06829-01-1