New York Laws
Article 8 - Conveyances and Mortgages
254 - Construction of Clauses and Covenants in Mortgages and Bonds or Notes.

(C1) ........ between ....... (D1)
........, party of the first part, and ....... (E1) ........, of .......
(F1) ........, party of the second part.
"Whereas, the said ........ (D1) ........ is justly indebted to the
said party of the second part in the sum of ........ (G1) ........
dollars, lawful money of the United States, secured to be paid by his
certain bond, note or obligation, bearing even date herewith,
conditioned for the payment of the said sum of ......... (G1) ........
dollars, on the ........ (H1) ....... day of ....... (I1) .......
nineteen hundred and ........ (J1) ........ and the interest thereon, to
be computed from ........ (K1) ........, at the rate of ....... (L1)
....... per centum per annum, and to be paid ....... (M1) .........
"It being thereby expressly agreed that the whole of the said
principal sum shall become due after default in the payment of any
installment of principal, interest, taxes or assessments, as hereinafter
provided.
"Now this indenture witnesseth, that the said party of the first part,
for the better securing the payment of the said sum of money mentioned
in the condition of the said bond, note or obligation, with interest
thereon, and also for and in consideration of one dollar, paid by the
said party of the second part, the receipt whereof is hereby
acknowledged, doth hereby grant and release unto the said party of the
second part, and to his heirs (or successors) and assigns for ever
(description), together with the appurtenances, and all the estate and
rights of the party of the first part in and to said premises, together
with all fixtures and articles of personal property attached to, or used
in connection with, the premises. To have and to hold the above granted
premises unto the said party of the second part, his heirs and assigns
forever. Provided, always, that if the said party of the first part, his
heirs, executors or administrators, shall pay unto the said party of the
second part, his executors, administrators or assigns, the said sum of
money mentioned in the condition of the said bond, note or obligation,
and the interest thereon, at the time and in the manner mentioned in the
said condition, that then these presents, and the estate hereby granted,
shall cease, determine and be void."
(b) A covenant "that the mortgagor will keep the buildings on the
premises insured against loss by flood if the premises are located in an
area identified by the Secretary of Housing and Urban Development as an
area having special flood hazards and in which flood insurance has been
made available under the National Flood Insurance Act of nineteen
hundred sixty-eight; that he will assign and deliver the policies to the
mortgagee; and that he will reimburse the mortgagee for any premiums
paid for insurance made by the mortgagee on the mortgagor's default in
so insuring the buildings or in so assigning and delivering the
policies," shall be construed as meaning that the mortgagor, his heirs,
successors and assigns will, during all the time until the money secured
by the mortgage shall be fully paid and satisfied, keep the buildings
erected on the premises insured against loss or damage by flood provided
the premises are located in an area identified by the Secretary of
Housing and Urban Development of the United States as an area having
special flood hazards and in which flood insurance is available under
the National Flood Insurance Act of nineteen hundred sixty-eight, to an
amount at least equal to the outstanding principal balance of the money
secured by the mortgage or the maximum limit of coverage available with
respect to the buildings under said Act, whichever is less, and in a
company or companies to be approved by the mortgagee and will assign and
deliver the policy or policies of such insurance to the mortgagee, his
executors, administrators, successors or assigns, which policy or
policies shall have endorsed thereon the standard New York mortgagee
clause in the name of the mortgagee, so and in such manner and form that
he and they shall at all time and times, until the full payment of said
money, have and hold the said policy or policies as a collateral and
further security for the payment of said money, and in default of so
doing, that the mortgagee or his executors, administrators, successors
or assigns may make such insurance from year to year, in the amount as
aforesaid, and pay the premium or premiums therefor, and that the
mortgagor will pay to the mortgagee, his executors, administrators,
successors or assigns, such premium or premiums so paid, with interest
from the time of payment, on demand, and that the same shall be deemed
to be secured by the mortgage, and shall be collectible thereupon and
thereby in like manner as the principal moneys, and that should the
mortgagee by reason of such insurance receive any sum or sums of money
for damage by flood, the provisions for retention, holding application
and payment of said insurance money shall be as set forth in paragraph
(a) above with respect to loss by fire. The term "mortgage," as
hereinabove used, shall be deemed to include agreements extending or
otherwise in any way modifying the terms or provisions of an existing
mortgage. The term "mortgagor," as hereinabove used, shall mean the
owner for the time being of the mortgaged fee or the junior mortgagee
actually in possession of the mortgaged property, or the tenant for the
time being in possession of the property under a lease which has been
mortgaged. The term "mortgagee," as hereinabove used, shall be deemed to
include the successors in interest of the mortgagee. In the event that
there be more than one mortgage covering the same premises, such
covenant must be construed as hereinbefore prescribed in this paragraph

except that the mortgagor, his heirs, successors and assigns,
notwithstanding such foregoing provisions, may not be required to
provide such insurance, as to all the mortgagees combined, in the
preferential order of their priority, for a total amount greater than
the outstanding principal balance of the money secured by the mortgage
or the maximum limit of coverage available with respect to the premises,
whichever is less, and a second or subordinate mortgagee shall be
entitled to exercise the rights of a mortgagee with respect to the
procurement of such insurance and the holding of the policy or policies
thereof as hereinbefore prescribed in this paragraph only when and to
the extent that the mortgagor, his heirs, successors or assigns, as the
case may be, does or do not furnish satisfactory proof of such maximum
insurance for the benefit of such second or subordinate mortgagee and
one or more other mortgagees in the preferential order of their priority
in a company or companies duly authorized to do business in this state.
The limitations and qualifications hereinabove imposed on the
mortgagee's right to retain proceeds of a flood insurance policy shall
apply only to mortgages or extensions or other modifications thereof
made after the effective date of this act.
4-a. Mortgagor to maintain premises and all improvements thereon in
good condition or repair. (a) A covenant contained in a mortgage on real
property improved by a residence for four families or more that the
mortgagor will maintain the premises and all improvements thereon in
"good condition or repair" shall be construed as meaning that the
mortgagor, his heirs, successors and assigns will, during all the time
until the money secured by the mortgage shall be fully paid and
satisfied, keep the premises and the building or buildings erected
thereon in good condition and repair and free from violations of
applicable municipal or state laws, codes or regulations concerning the
state of such condition and/or repair. Upon a finding and certification
by any such government or its agency of a violation of any such law,
code or regulation involving a serious danger to the health and safety
of the occupants of such mortgaged premises and upon the service of one
copy thereof on the owner of record, or upon the appointment of an
administrator pursuant to article seven-A of the real property actions
and proceedings law, such mortgagee may declare the entire balance of
the principal sum secured by such mortgage, together with all accrued
interest, immediately due and payable upon the following conditions: the
mortgagee shall allow the mortgagor a reasonable opportunity to correct
the violation or, in the case of an administrator appointed pursuant to
article seven-A of the real property actions and proceedings law, to
have such administrator removed; the mortgagee may commence foreclosure
proceedings upon failure of the mortgagor to make such corrections
within the time period mandated by local law, rule or code enforcement
agency, provided, however, no such action shall be commenced within
thirty days of the expiration of the period, if any, specified by local
law, rule or code enforcement regulation, or, in the case of an
administrator appointed pursuant to article seven-A of the real property
actions and proceedings law, the mortgagee may commence foreclosure
proceedings no earlier than sixty days after the appointment of such
administrator.
(b) Should any such mortgagee commence a foreclosure proceeding based
upon such violation and not complete the same because such violation had
been cured, the mortgagee shall be entitled to recover all reasonable
attorney's fees and disbursements incurred in the bringing of such
proceeding.
(c) Notwithstanding the provisions of this section, the mortgagee and
the mortgagor shall retain all existing interest and rights.

5. Mortgagor to warrant title. A covenant "that the mortgagor warrants
the title to the premises," must be construed as meaning that the
mortgagor warrants that he has good title to said premises and has a
right to mortgage the same and that the mortgagor shall and will make,
execute, acknowledge and deliver in due form of law, all such further or
other deeds or assurances as may at any time hereafter be reasonably
desired or required for the more fully and effectually conveying the
premises by the mortgage described, and thereby granted or intended so
to be, unto the said mortgagee, his executors, administrators,
successors or assigns, for the purpose aforesaid, and unto all and every
person or persons, corporation or corporations, deriving any estate,
right, title or interest therein, under the said indenture of mortgage,
or the power of sale therein contained, and the said granted premises
against the said mortgagor, and all persons claiming through him will
warrant and defend.
6. Mortgagor to pay all taxes, assessments or water rates. A covenant
"that the mortgagor will pay all taxes, assessments or water rates and
in default thereof, the mortgagee may pay the same" must be construed as
meaning that until the amount hereby secured is paid, the mortgagor will
pay all taxes, assessments and water rates which may be assessed or
become liens on said premises, and in default thereof the holder of this
mortgage may pay the same, and the mortgagor will repay the same with
interest, and the same shall be liens on said premises and secured by
the mortgage.
7. Statement of amount due. A covenant "that the mortgagor
within ...... days upon request in person or within ...... days upon
request by mail will furnish a written statement duly acknowledged of
the amount due on this mortgage and whether any offsets or defenses
exist against the mortgage debt" must be construed as meaning that the
mortgagor, and any subsequent owner of the premises described herein
upon request, made either personally or by mail, shall certify, by a
writing duly acknowledged, to the mortgagee or to any proposed assignee
of this mortgage, the amount of principal and interest then owing on
this mortgage and whether any offsets or defenses exist against the
mortgage debt within ..... days in case the request is made personally,
or within ...... days after the mailing of such request in case the
request is made by mail.
8. Notice and demand. A covenant "that notice and demand or request
may be made in writing and may be served in person or by mail" must be
construed as meaning that every provision for notice and demand or
request shall be deemed fulfilled by written notice and demand or
request personally served on one or more of the persons who shall at the
time hold the record title to the premises, or on their heirs or
successors, or mailed by depositing it in any post-office station or
letter-box, enclosed in a post-paid envelope addressed to such person or
persons, or their heirs or successors, at his, their or its address to
the mortgagee last known.
9. Power of attorney to assignee. The word "assign" or other words of
assignment, when contained in an assignment of a mortgage and bond or
mortgage and note, must be construed as having included in their meaning
that the assignor does thereby make, constitute and appoint the assignee
the true and lawful attorney, irrevocable, of the assignor, in the name
of the assignor, or otherwise, but at the proper costs and charges of
the assignee, to have, use and take all lawful ways and means for the
recovery of the money and interest secured by the said mortgage and bond
or mortgage and note, and in case of payment to discharge the same as
fully as the assignor might or could do if the assignment were not made.

10. Mortgagee entitled to appointment of receiver. A covenant "that
the holder of this mortgage, in any action to foreclose it, shall be
entitled to the appointment of a receiver," must be construed as meaning
that the mortgagee, his heirs, successors or assigns, in any action to
foreclose the mortgage, shall be entitled, without notice and without
regard to adequacy of any security of the debt, to the appointment of a
receiver of the rents and profits of the premises covered by the
mortgage; and the rents and profits in the event of any default or
defaults in paying the principal, interest, taxes, water rents,
assessments or premiums of insurance, are assigned to the holder of the
mortgage as further security for the payment of the indebtedness.

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