S886-2011 - NY Senate Open Legislation - Prohibits compensation based on home loan terms by a mortgage broker or mortgage lender

Prohibits compensation based on home loan terms by mortgage brokers or mortgage lenders.

Sponsor: KRUEGER / Co-sponsor(s): MONTGOMERY
Law Section: Banking Law / Law: Amd SS590-b, 6-l & 6-m, Bank L

S886-2011 Actions

Aug 17, 2012: SIGNED CHAP.404
Aug 6, 2012: DELIVERED TO GOVERNOR
Jun 19, 2012: returned to senate
Jun 19, 2012: passed assembly
Jun 19, 2012: ordered to third reading rules cal.381
Jun 19, 2012: substituted for a7329
Mar 21, 2012: referred to banks
Mar 21, 2012: DELIVERED TO ASSEMBLY
Mar 21, 2012: PASSED SENATE
Mar 13, 2012: ADVANCED TO THIRD READING
Mar 12, 2012: 2ND REPORT CAL.
Mar 7, 2012: 1ST REPORT CAL.314
Mar 6, 2012: NOTICE OF COMMITTEE CONSIDERATION - WITHDRAWN
Feb 21, 2012: NOTICE OF COMMITTEE CONSIDERATION - REQUESTED
Jan 4, 2012: REFERRED TO BANKS
Jan 5, 2011: REFERRED TO BANKS

S886-2011 Meetings

Banks: Mar 7, 2012

S886-2011 Calendars

Active List: Mar 21, 2012 , Floor Calendar: Mar 12, 2012 , Floor Calendar: Mar 13, 2012 , Floor Calendar: Mar 14, 2012 , Floor Calendar: Mar 15, 2012 , Floor Calendar: Mar 19, 2012 , Floor Calendar: Mar 20, 2012 , Floor Calendar: Mar 21, 2012

S886-2011 Votes

VOTE: COMMITTEE VOTE: - Banks - Mar 7, 2012

Ayes (13): Farley, Bonacic, DeFrancisco, Marcellino, Smith, Breslin, Carlucci, Diaz, Krueger, Rivera, Savino, Valesky, Avella
Ayes W/R (6): Griffo, Gallivan, Golden, Johnson, O'Mara, Ranzenhofer

VOTE: FLOOR VOTE: - Mar 21, 2012

Ayes (59): Adams, Addabbo, Alesi, Avella, Ball, Bonacic, Breslin, Carlucci, DeFrancisco, Diaz, Dilan, Duane, Espaillat, Farley, Flanagan, Fuschillo, Gallivan, Gianaris, Golden, Griffo, Grisanti, Hannon, Hassell-Thomps, Huntley, Johnson, Kennedy, Klein, Krueger, Lanza, Larkin, LaValle, Libous, Little, Marcellino, Martins, Maziarz, McDonald, Montgomery, Nozzolio, Parker, Peralta, Perkins, Ranzenhofer, Ritchie, Rivera, Robach, Saland, Sampson, Savino, Serrano, Seward, Skelos, Smith, Squadron, Stavisky, Stewart-Cousin, Valesky, Young, Zeldin
Nays (1): O'Mara
Excused (1): Oppenheimer

S886-2011 Memo

BILL NUMBER:S886

TITLE OF BILL:
CONCURRENT RESOLUTION OF THE SENATE AND ASSEMBLY
proposing an amendment to
section 2 of article 6 of the constitution, in relation to persons
appointed to the court of appeals, and proposing an amendment to
section 25 of article 6 of the constitution,
in relation to service by retired justices and requiring judges
of the court of appeals to retire at age 80

PURPOSE OF BILL:
To raise from 76 to 80 the maximum age that retired judges may be
certified to continue to serve, and to raise the retirement age for
judges of the Court of Appeals.

SUMMARY OF PROVISIONS OF BILL:
Amends subdivision (e) of section 2 of Article 6 and subdivision (b)
of section 25 of Article 6 of the New York State Constitution to
increase the maximum age for which a judge, justice or retired
justice can serve.

JUSTIFICATION:
The State Constitution requires judges to retire at the end of the
calendar year in which they turn 70. It also authorizes judges to be
certified to continue to serve up to three times in two year
increments, until age 76. The certification must find that that his
or her services are necessary to expedite the business of the Court,
and that he or she is physically and mentally competent to fully
perform the duties of the office.

This constitutional amendment would raise the age through which
retired judges can continue to serve from 76 to 80, allowing the
State to retain experienced and able judges who are willing to work.
In addition, this measure would change the retirement age for judges
of the Court of Appeals from 70 to 80, provided that no judge could
be appointed to the Court of Appeals after they have reached the last
day of December of the year in which they turn 70, consistent with
the existing constitutional provision.

In 1999, The Office of Court Administration's Task Force on Mandatory
Retirement of Judges concluded that "it is in the best interests of
the judiciary and the people of the State of New York to amend the
laws governing mandatory retirement of judges." The two
recommendations made in that, report - creation of a "senior status"
and expansion of the certification process to judges not covered by
it - were not acted upon.

This measure takes a different approach - amending the Constitution to
increase the age until which judges can be certified from 76 to 80.
Raising the age that retired judges can serve from 76 to 80 will

enable the state judiciary to continue to benefit from the service of
many dedicated, experienced and productive judges currently being lost.

In addition, this bill provides that Court of Appeals judges would be
able to serve out the end of their fourteen years terms without being
required to retire at age 70, although appointment past the age of 70
would not be possible.

LEGISLATIVE HISTORY:
S.5827 of 2011: Passed Senate and Assembly. Delivered to Secretary of
State

FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
None anticipated.

EFFECTIVE DATE:
RESOLVED (if the Assembly concur), That the foregoing be referred to the
first regular legislative session convening after the next succeeding
general election of members of the assembly, and, in conformity with
section 1 of article 19 of the constitution, be published for 3 months
previous to the time of such election.

S886-2011 Text

 S T A T E   O F   N E W   Y O R K
 
                                           886
 2011-2012 Regular Sessions
 I N  SENATE
 (PREFILED)
 January 5, 2011
 
 Introduced  by  Sen. KRUEGER -- read twice and ordered printed, and when
 printed to be committed to the Committee on Banks
 

AN ACT to amend the banking law, in relation to prohibiting compensation
 based on the terms of a home loan by  mortgage  brokers  and  mortgage
 lenders
 

THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM
 BLY, DO ENACT AS FOLLOWS:

 

Section 1.

Section 590-b of the banking law is amended by adding a new
 subdivision 3-a to read as follows:

 3-A. IN CONNECTION WITH THE MAKING OR BROKERING OF  A  HOME  LOAN,  NO
 PERSON  MAY  PROVIDE,  AND  NO  MORTGAGE  BROKER  OR MORTGAGE LENDER MAY
 RECEIVE, DIRECTLY OR INDIRECTLY, ANY COMPENSATION THAT IS BASED  ON,  OR
 VARIES  WITH,  THE  TERMS  OF  ANY HOME LOAN. THIS SUBDIVISION SHALL NOT
 PROHIBIT COMPENSATION BASED ON THE PRINCIPAL BALANCE OF THE LOAN.
 

S 2. Paragraph (s) of subdivision 2 of section 6-l of the banking law,
 as amended by chapter 507 of the laws of 2009, is  amended  to  read  as
 follows:

 (s) No [abusive] yield spread premiums. [In arranging a high-cost home
 loan,  the  mortgage broker shall, within three days after receipt of an
 application, disclose the exact amount and methodology of total  compen-
 sation  that  the broker will receive. Such amount may be paid as direct
 compensation from the lender, direct compensation from the borrower,  or
 a combination of the two if permitted by applicable law.  The provisions
 of  this  paragraph  shall  not  restrict  the  ability of a borrower to
 utilize a yield spread premium in order to offset any up front costs  by
 accepting  a higher interest rate if permitted by applicable law. If the
 borrower chooses this option, any  compensation  from  the  lender  that
 exceeds  the  amount  of  total  compensation owed to the broker must be
 credited to the borrower. The superintendent shall  prescribe  the  form
 that  such  disclosure  shall  take. This provision shall not restrict a
 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
 [ ] is old law to be omitted.
 LBD03866-01-1
        S. 886                              2
 broker from accepting a lesser amount of  compensation.]  IN  CONNECTION
 WITH  THE MAKING OR BROKERING OF A HOME LOAN, NO PERSON MAY PROVIDE, AND
 NO MORTGAGE BROKER OR MORTGAGE LENDER MAY RECEIVE, DIRECTLY OR INDIRECT
 LY,  ANY COMPENSATION THAT IS BASED ON, OR VARIES WITH, THE TERMS OF ANY
 HOME LOAN. THIS PARAGRAPH SHALL NOT PROHIBIT COMPENSATION BASED  ON  THE
 PRINCIPAL BALANCE OF THE LOAN.
 

S 3. Paragraph (n) of subdivision 2 of section 6-m of the banking law,
 as  amended  by  chapter  507 of the laws of 2009, is amended to read as
 follows:

 (n) No [abusive] yield spread premiums. [In arranging a subprime  home
 loan,  the  mortgage broker shall, within three days after receipt of an
 application, disclose the exact amount and methodology  for  determining
 the  total compensation that the broker will receive. Such amount may be
 paid as direct compensation from the lender,  direct  compensation  from
 the  borrower,  or  a  combination of the two if permitted by applicable
 law. The provisions of this paragraph shall not restrict the ability  of
 a  borrower  to  utilize  a  yield spread premium in order to offset any
 upfront costs by accepting a higher interest rate if permitted by appli-
 cable law. If the borrower chooses this option,  any  compensation  from
 the  lender  that exceeds the exact amount of total compensation owed to
 the broker must be credited to the borrower.  The  superintendent  shall
 prescribe the form that such disclosure shall take. This paragraph shall
 not  restrict  a broker from accepting a lesser amount of compensation.]
 IN CONNECTION WITH THE MAKING OR BROKERING OF A HOME LOAN, NO PERSON MAY
 PROVIDE, AND NO MORTGAGE BROKER OR MORTGAGE LENDER MAY RECEIVE, DIRECTLY
 OR INDIRECTLY, ANY COMPENSATION THAT IS BASED ON, OR  VARIES  WITH,  THE
 TERMS  OF  ANY HOME LOAN. THIS PARAGRAPH SHALL NOT PROHIBIT COMPENSATION
 BASED ON THE PRINCIPAL BALANCE OF THE LOAN.
 

S 4. This act shall take effect immediately.

S886-2011: Prohibits compensation based on home loan terms by a mortgage broker or mortgage lender