New York Laws
Article 1 - Short Title; Definitions; Miscellaneous Provisions.
6-F - Alternative Mortgage Instruments Made by Banks, Trust Companies, Savings Banks, Savings and Loan Associations and Credit Unions.

(1) a statement that the lender will be entitled to share in any
appreciation of the market value of the mortgaged property that occurs

between the time of the loan modification and the time the property is
sold, up to the amount of principal forborne plus interest on such
amount at the applicable rate of interest on the mortgage but in no
event more than fifty percent of the amount of such appreciation, and
providing at least three examples of how such shared appreciation may
affect the borrower at the time the borrower sells the mortgaged
property, such examples to include (A) no appreciation in the value of
the mortgaged property, (B) appreciation of twenty percent and (C)
appreciation of fifty percent;
(2) a statement advising the borrower to seek independent counseling
from a lawyer, a HUD-certified mortgage counselor or a tax advisor
regarding (A) the trade-off between a current reduction in the size of
the mortgage, versus the promise to give up part of the future
appreciation of the home, and (B) the tax consequences of the principal
forgiveness and shared appreciation agreement, and providing a list of
the names and contact information of five HUD-certified mortgage
counselors in the county where the mortgaged property is located or, if
there are fewer than five such counselors in that county, the list may
include counselors in one or more neighboring counties;
(3) a statement on the potential effect of the shared appreciation
agreement on any future refinancing of the mortgage and the potential
effect of any prepayment or refinancing of the mortgage on the
appreciation sharing agreement; and
(4) such other disclosures as the superintendent of financial services
may require.
2. Any rules or regulations which are adopted by the superintendent of
financial services pursuant to subdivision one of this section:
(a) shall provide for disclosures and notices to the borrower with
respect to the terms and conditions of the loan and the mortgage, and
the superintendent of financial services may require the adoption of
uniform disclosure and notice forms for this purpose;
(b) shall provide for the conditions governing renewals of the term of
the loan;
(c) shall not permit any uninsured loan secured by residential real
property to be made in an amount exceeding ninety percent of the
appraised value of the property; and
(d) shall not allow, with respect to any specific alternative mortgage
instrument which permits a periodic readjustment of the rate charged on
the loan, for a greater change in rate than that permitted under federal
law or regulations to federally-chartered banking organizations located
in this state for loans made pursuant to an equivalent alternative
mortgage instrument.

Structure New York Laws