§ 5-602 — Interest on insurance draft deposits in escrow with mortgage investing institutions

§ 5-602. Interest on insurance draft deposits in escrow with mortgage\ninvesting institutions. Any mortgage investing institution which\nmaintains an escrow account pursuant to any agreement executed in\nconnection with a mortgage or any loan, secured by a lien on any one to\nsix family residence occupied by the owner or on any property owned by a\ncooperative apartment corporation, as defined in subdivision twelve of\nsection three hundred sixty of the tax law, (as such subdivision was in\neffect on December thirtieth, nineteen hundred sixty), and located in\nthis state and which residence or cooperative apartment corporation\nreceived from an insurance carrier a draft, forwarded to a mortgage\ninvesting institution, as compensation for damage done to a residence\nshall, for each quarterly period in which such escrow account is\nestablished, credit the same with dividends or interest at a rate of not\nless than two per centum per year based on the average of the sums so\npaid for the average length of time on deposit or a rate prescribed by\nthe superintendent of financial services pursuant to section fourteen-b\nof the banking law and pursuant to the terms and conditions set forth in\nthat section whichever is higher. The superintendent of financial\nservices shall prescribe by regulation the method or basis of computing\nany minimum rate of interest required by this section and any such\nminimum rate shall be a net rate over and above any service charge that\nmay be imposed by any mortgage lending institution for maintaining an\nescrow account. No mortgage investing institution shall impose a service\ncharge in connection with the maintenance of an escrow account unless\nprovision therefor was expressly made in a loan contract executed prior\nto the effective date of this section.\n