New York Laws
Part 2
2428 - Insurance of Mortgages.

(a) the authorized lender requires primary mortgage insurance on the
real property and the applicant is unable to procure such mortgage
insurance in the private market;
(b) the reverse mortgage loan is issued pursuant to section two
hundred eighty or two hundred eighty-a of the real property law;
(c) the reverse mortgage loan amount shall not exceed the loan to
value ratio as may be determined by the superintendent of financial
services; and
(d) the real property which is the security for such reverse mortgage
loan meets such other requirements as the agency may from time to time
establish.
* 4. To be eligible for insurance under this article, a mortgage loan
shall (a) (i) be a first lien of the kind which is commonly given to
secure advances on, or the unpaid purchase price of, real property under
the laws of the state together with any credit instrument secured
thereby, provided, however, that a mortgage loan may be a second lien if
such mortgage loan was purchased by the agency or (ii) be secured by an
assignment or transfer of stock certificates or other evidence of
ownership interest of the borrower in, and a proprietary lease from, a
corporation formed for the purpose of the cooperative ownership of
residential real estate in the state; (b) secure a rehabilitation or
preservation loan on real property held in fee simple or on a leasehold
under a proprietary lease or a lease having a period of years to run at
the time the mortgage is insured under this article of at least twenty
per centum greater duration than the remaining term of the mortgage; (c)
contain terms with respect to 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 agency may
in its discretion prescribe; (d) be accompanied by certificates, issued
by such officers of the mortgage financial institutions, independent
appraisers or other persons as the agency may require, certifying that

(i) where appropriate, the annual income to be derived from the property
equals not less than one hundred and five per centum of the annual
charges and expenses, including provision for reserves, satisfactory to
the agency, for the amortization of subordinate mortgage loans over the
remaining terms of such loans notwithstanding the provisions thereof;
(ii) the remaining useful life of the property is greater than the term
of the mortgage; and (iii) the property does not contain any substantial
violations of local building maintenance and construction codes, except
that in the case of a loan made to the owner of a property containing
any such violations, the agency may insure or commit to insure such loan
if the mortgagee and the owner have submitted a plan, satisfactory to
the agency to eliminate such violations and the issuance of such
insurance shall be conditioned on removal of such violations to the
satisfaction of the local code enforcement agency; and (e) satisfy such
additional terms and conditions as the agency may prescribe. For pool
insurance, the requirements of paragraph (b) of this subdivision shall
not be applicable.
* NB Effective until July 23, 2025
* 4. To be eligible for insurance under this article, a mortgage loan
shall (a) (i) be a first lien of the kind which is commonly given to
secure advances on, or the unpaid purchase price of, real property under
the laws of the state together with any credit instrument secured
thereby, provided, however, that a mortgage loan may be a second lien if
such mortgage loan was purchased by the agency or (ii) be secured by an
assignment or transfer of stock certificates or other evidence of
ownership interest of the borrower in, and a proprietary lease from, a
corporation formed for the purpose of the cooperative ownership of
residential real estate in the state; (b) secure a rehabilitation or
preservation loan on real property held in fee simple or on a leasehold
under a proprietary lease or a lease having a period of years to run at
the time the mortgage is insured under this article of at least twenty
per centum greater duration than the remaining term of the mortgage; (c)
contain terms with respect to 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 agency may
in its discretion prescribe; (d) be accompanied by certificates, issued
by such officers of the mortgage financial institutions, independent
appraisers or other persons as the agency may require, certifying that
(i) where appropriate, the annual income to be derived from the property
equals not less than one hundred and five per centum of the annual
charges and expenses, including provision for reserves, satisfactory to
the agency, for the amortization of subordinate mortgage loans over the
remaining terms of such loans notwithstanding the provisions thereof;
(ii) the remaining useful life of the property is greater than the term
of the mortgage; and (iii) the property does not contain any substantial
violations of local building maintenance and construction codes, except
that in the case of a loan made to the owner of a property containing
any such violations, the agency may insure or commit to insure such loan
if the mortgagee and the owner have submitted a plan, satisfactory to
the agency to eliminate such violations and the issuance of such
insurance shall be conditioned on removal of such violations to the
satisfaction of the local code enforcement agency; and (e) satisfy such
additional terms and conditions as the agency may prescribe.
* NB Effective July 23, 2025
5. In addition to the conditions set forth in subdivisions three and
four of this section, the agency shall not insure nor issue a commitment
to insure any rehabilitation loan unless it shall first find that

rehabilitation is necessary to upgrade the property and that
rehabilitation will not necessitate more than a minimum amount of
relocation of the residents of any housing accommodation.
6. A financial institution may request insurance by written
application to the agency in such form and manner, together with such
information and documents, as the agency may prescribe. No application
shall be complete unless and until the financial institution has paid
such processing fees and other charges as the agency may impose in
connection therewith. The agency shall signify its acceptance of such
application for insurance by issuance of a commitment to insure or a
contract of insurance.
7. * (a) The board of directors of the agency may, from time to time,
by vote of a majority of all of its members, establish a percentage
greater than the per centum set in subdivision five of section
twenty-four hundred twenty-six of this title for any or all of the
following categories of loans insurable by the agency or for one or more
loans within such categories: one to four family dwellings one unit of
which is owner-occupied; one to four family dwellings which are not
owner-occupied; five or more family dwellings; proprietary leases;
condominiums; loans secured by other real property; loans purchased or
to be purchased by the agency with proceeds of bonds or notes issued by
the agency; loans securing bonds or notes issued by the agency; loans
covered by pool insurance; or, combinations thereof. The board shall
specify such percentage and shall specify the date on which the
establishment of such percentage shall take effect as to (i) commitments
issued on or after such date and (ii) nothing contained in this section
shall be construed to prohibit the board of directors of the agency from
reducing the per centum used in calculating the mortgage insurance fund
requirement, provided such new per centum is not less than that set in
subdivision five of section twenty-four hundred twenty-six of this
title.
* NB Effective until July 23, 2025
* (a) The board of directors of the agency may, from time to time, by
vote of a majority of all of its members, establish a percentage other
than the percentum set in subdivision five of section twenty-four
hundred twenty-six of this chapter for any or all of the following
categories of loans insurable by the agency: single family residences
which are owner-occupied; single family residences which are not
owner-occupied; multi-family residences; proprietary leases;
condominiums and loans secured by other real property; or, combinations
thereof. The board shall specify such percentage in multiples of five
and shall specify the date on which the establishment of such percentage
shall take effect as to commitments issued on or after such date.
* NB Effective July 23, 2025
(b) No change in the amount of moneys which must be held in or
credited to the mortgage insurance fund pursuant to paragraph (a) of
this subdivision shall have force or effect until the governor of the
state of New York shall have an opportunity to approve or veto it. For
the purpose of procuring such approval or veto, the secretary of the
board shall transmit to the governor at the executive chamber in Albany
a certified copy of that portion of the minutes of the meeting of the
board in which such change was discussed and voted upon as soon after
the holding of such meeting as the minutes can be prepared. The governor
shall, within thirty days, Saturdays, Sundays and public holidays
excepted, after such minutes shall have been delivered at the executive
chamber as aforesaid, cause the same to be returned to the board either
with his approval or with his veto, provided, however, that if the
governor shall not return such minutes within such period then at the

expiration thereof the change therein authorized will have full force
and effect according to the wording thereof. If the governor within such
period returns such minutes with a veto against the change, then such
change shall be null and void.
* 8. Notwithstanding any contrary provisions of this article or of any
other law, rule or regulation, on and after the effective date of this
subdivision;
(a) Except for pool insurance, the agency shall not issue a commitment
to insure nor shall it provide loan insurance for any loan if twenty
percent (or such other percentage as may be established pursuant to
subdivision seven of this section) of the amount to be insured exceeds
ten percent of the mortgage insurance fund requirement for all loans
insured and loans for which commitments to insure have been issued at
that time.
(b) If less than fifty percent, or none of the space of the project is
or is to be used for residential purposes, the amount of such loan
insurance shall not exceed five million dollars and no such loan
insurance may be issued unless the agency finds that the space which is
to be used for other than residential purposes is to be used to provide
the residents of the neighborhood with retail and community service
facilities which would not otherwise be provided. The provisions of this
paragraph shall not apply to loan insurance for projects which provide
temporary shelter for homeless persons or community health facilities.
(c) The agency shall not issue a commitment to insure nor shall it
provide loan insurance for a preservation loan unless: (i) such loan is
made with respect to a one to four family dwelling; or (ii) such loan is
made with respect to a building, which on the effective date of this
subparagraph, is owned by a cooperative housing corporation formed for
the purpose of the cooperative ownership of residential real estate in
the state where such refinancing is not otherwise available and such
loan will facilitate or accommodate affordable homeownership
opportunities; or (iii) such loan is made with respect to the real
property and improvements owned by a cooperative housing corporation
formed for the purpose of the cooperative ownership of residential
manufactured homes in the state where such refinancing is not otherwise
available and such loan will facilitate or accommodate affordable
homeownership opportunities; or (iv) such loan is made with respect to
multi-family residential buildings with existing indebtedness originated
during the period from January first, two thousand four through December
thirty-first, two thousand eight, where such loan will facilitate or
accommodate the preservation of affordable housing accommodations.
* NB Effective until July 23, 2025
* 8. Notwithstanding any contrary provisions of this article or of any
other law, rule or regulation, on and after the effective date of this
subdivision;
(a) The agency shall not issue a commitment to insure nor shall it
provide loan insurance for an amount in excess of the lesser of ten
million dollars or forty percent of the amount of money on deposit in
the mortgage insurance fund at that time.
(b) If less than fifty percent, or none of the space of the project is
or is to be used for residential purposes, the amount of such loan
insurance shall not exceed five million dollars and no such loan
insurance may be issued unless the agency finds that the space which is
to be used for other than residential purposes is to be used to provide
the residents of the neighborhood with retail and community service
facilities which would not otherwise be provided.
(c) The agency shall not issue a commitment to insure nor shall it
provide loan insurance for a preservation loan unless (i) such loan is

made with respect to a one to four family dwelling; or (ii) such loan is
made with respect to a building, which on the effective date of this
subparagraph, is owned by a cooperative housing corporation formed for
the purpose of the cooperative ownership of residential real estate in
the state where such refinancing is not otherwise available and such
loan will facilitate or accommodate affordable homeownership
opportunities; or (iii) such loan is made with respect to the real
property and improvements owned by a cooperative housing corporation
formed for the purpose of the cooperative ownership of residential
manufactured homes in the state where such refinancing is not otherwise
available and such loan will facilitate or accommodate affordable
homeownership opportunities.
* NB Effective July 23, 2025