Senate Bill S7232

2017-2018 Legislative Session

Enacts the Home Equity Fraud Act to control improper activities by home improvement contractors and finance companies

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Sponsored By

Archive: Last Bill Status - In Senate Committee Banks Committee


  • Introduced
    • In Committee Assembly
    • In Committee Senate
    • On Floor Calendar Assembly
    • On Floor Calendar Senate
    • Passed Assembly
    • Passed Senate
  • Delivered to Governor
  • Signed By Governor

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2017-S7232 (ACTIVE) - Details

Current Committee:
Senate Banks
Law Section:
Banking Law
Laws Affected:
Amd §§595-a, 347 & 592-a, Bank L; add §254-e, RP L; add §§1316 & 1317, RPAP L; amd §771, add §771-b, Gen Bus L; add §5-336, Gen Ob L
Versions Introduced in Other Legislative Sessions:
2011-2012: S7271
2013-2014: S19
2015-2016: S186
2019-2020: S5065
2021-2022: S5646
2023-2024: S7209

2017-S7232 (ACTIVE) - Summary

Enacts the "Home Equity Fraud Act" to control improper activities by home improvement contractors and finance companies; prohibits mortgage brokers or agents from acting as home improvement contractors; provides additional protections for mortgagors and homeowners.

2017-S7232 (ACTIVE) - Sponsor Memo

2017-S7232 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7232
 
                             I N  S E N A T E
 
                              January 4, 2018
                                ___________
 
 Introduced  by  Sen.  PARKER -- read twice and ordered printed, and when
   printed to be committed to the Committee on Banks
 
 AN ACT to amend the banking law, the real property law, the real proper-
   ty actions and proceedings law,  the  general  business  law  and  the
   general  obligations  law,  in  relation  to enacting the "Home Equity
   Fraud Act"

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Short  title. This act shall be known and may be cited as
 the "Home Equity Fraud Act".
   § 2. Legislative findings. The  legislature  hereby  finds  that  many
 senior  citizens  and minority homeowners in New York have been targeted
 by unethical home improvement contractors, mortgage companies,  mortgage
 brokers  and finance companies who induce these homeowners into entering
 into high cost high interest rate mortgage agreements which the homeown-
 er is often unable to afford with the intent of foreclosing on the  home
 and stripping the equity.
   The  legislature  further  finds  that  in order to entice people into
 entering into these agreements they are promised refinancing of  primary
 mortgages,  consolidation  of  loans and outstanding bills and are given
 cash but often are not told or do not understand that they are  securing
 the  loan with a mortgage lien on their home which will lead to foreclo-
 sure in the event of default. Often  these  loans  are  documented  with
 false and misleading documentation provided by brokers which could easi-
 ly  be determined to be false if checked by the lender. Despite prohibi-
 tions contained in federal law many of these loans are based  on  equity
 in  the  home  and  not  on the borrower's ability to pay. Since many of
 these homeowners live on a fixed income, they are  unable  to  make  the
 required  payments  and end up losing their homes. This practice appears
 to be targeted in neighborhoods with a high concentration of senior  and
 minority residents.
   The  legislature  further finds that it is in the best interest of the
 citizens of this state that these unethical practices should be  prohib-
 ited by law and that unscrupulous individuals should be denied the abil-
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
              

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