§ 2401 — Legislative findings

§ 2401. Legislative findings. * It is hereby found and declared that\nthere continues to exist throughout the state a seriously inadequate\nsupply of safe and sanitary dwelling accommodations, including\naccommodations for persons and families of low income, and a seriously\ninadequate supply of credit available for new residential improvement\nloans at carrying charges within the financial means of persons and\nfamilies of low or moderate income. This condition is contrary to the\npublic interest and threatens the health, safety, welfare, comfort and\nsecurity of the people of the state. It is found and declared that one\nmajor cause of this condition has been recurrent, cyclical shortages of\nfunds in private banking channels available for residential mortgages.\nSuch shortages have contributed to drastic reductions in construction\nstarts of new residential units. In addition, they have made the sale\nand purchase of existing residential units a virtual impossibility in\nmany parts of the state. The ordinary operations of private enterprise\nhave not in the past corrected these conditions.\n * NB Effective until July 23, 2027\n * It is hereby found and declared that there continues to exist\nthroughout the state a seriously inadequate supply of safe and sanitary\ndwelling accommodations, including accommodations for persons and\nfamilies of low income. This condition is contrary to the public\ninterest and threatens the health, safety, welfare, comfort and security\nof the people of the state. It is found and declared that one major\ncause of this condition has been recurrent, cyclical shortages of funds\nin private banking channels available for residential mortgages. Such\nshortages have contributed to drastic reductions in construction starts\nof new residential units. In addition, they have made the sale and\npurchase of existing residential units a virtual impossibility in many\nparts of the state. The ordinary operations of private enterprise have\nnot in the past corrected these conditions.\n * NB Effective July 23, 2027\n It is further found and declared that the drastic reduction in\nresidential construction starts associated with such shortages have\ncaused a condition of substantial unemployment and underemployment in\nthe construction industry which results in hardships to many individuals\nand families, wastes vital human resources, increases the public\nassistance burdens of the state and municipalities, impairs the security\nof family life, impedes the economic and physical development of\nmunicipalities and adversely affects the welfare and prosperity of all\nthe people of the state. A stable supply of adequate funds for\nresidential mortgages is required to spur new housing starts in an\norderly and sustained manner and thereby to reduce the hazards of\nunemployment and underemployment in the construction industry. The\nunaided operations of private enterprise have not met and cannot meet\nthe need for a stable supply of adequate funds for residential mortgage\nfinancing.\n It is further found and declared that these conditions associated with\nsuch recurrent shortages of residential mortgage funds contribute to the\npersistence of slums and blight and to the deterioration of the quality\nof the environment and living conditions of a large number of persons\nresiding in the state of New York, have adversely affected the economy\nof the state as a whole and are contrary to the declared policy of the\nstate to promote a vigorous and growing economy, to prevent economic\nstagnation, to increase revenues to the state and to its municipalities\nand to achieve stable local economies.\n * Based upon the experience of the past, most recently during the\nperiods of illiquidity which occurred in nineteen hundred sixty-six and\nagain in nineteen hundred sixty-nine, shortages of funds for residential\nmortgages in the private banking system can be expected to recur from\ntime to time in varying degrees of severity with the adverse\nconsequences described above. To avoid or minimize such consequences, to\nbring greater stability to the residential construction industry and\nrelated industries, and thus to assure a steady flow of production of\nnew housing units, there should be created a corporate governmental\nagency to be known as the "state of New York mortgage agency" which,\nthrough issuance of bonds and notes to the private investing public\nduring periods when there is an inadequate supply of credit available\nfor new loans for residential housing and housing improvement purposes,\nmay (i) purchase existing mortgages from banks and direct an amount\nequal to the proceeds from the liquidated mortgage investments into new\nmortgages on residential family dwelling units, (ii) purchase new\nmortgages on residential family dwelling units, (iii) purchase new\nhousing loans for the rehabilitation or improvement of residential\nfamily dwelling units, and (iv) purchase lease-to-own mortgage loans.\n * NB Effective until July 23, 2027\n * Based upon the experience of the past, most recently during the\nperiods of illiquidity which occurred in nineteen hundred sixty-six and\nagain in nineteen hundred sixty-nine, shortages of funds for residential\nmortgages in the private banking system can be expected to recur from\ntime to time in varying degrees of severity with the adverse\nconsequences described above. To avoid or minimize such consequences, to\nbring greater stability to the residential construction industry and\nrelated industries, and thus to assure a steady flow of production of\nnew housing units, there should be created a corporate governmental\nagency to be known as the "state of New York mortgage agency" which,\nthrough issuance of bonds and notes to the private investing public, may\npurchase existing mortgages from banks within the state during periods\nwhen there is an inadequate supply of credit available for new\nresidential mortgage loans and direct an amount equal to the proceeds\nfrom the liquidated mortgage investments into new mortgages on\nresidential real property for family units.\n * NB Effective July 23, 2027\n It is further found and declared that in addition to issuance of bonds\nand notes for such purposes, the accessibility of credit available for\nnew loans for residential housing and housing improvement purposes will\nalso be increased by making available to the people of the state to the\nfullest extent possible the benefit of federal programs providing\ncredits against income tax for a portion of interest paid on residential\nmortgage and housing loans.\n The secondary mortgage market provided by the corporate governmental\nagency created by this title is hereby found and determined to be an\nappropriate and effective means of making residential mortgages a more\nattractive investment for the private banking system, of reducing the\nvolatility of mortgage flows over the business cycle, and of providing\ngreater stability for the economies of the state and its municipalities.\n It is further found and determined that it has long been the public\npolicy of the state to encourage every student who has the desire and\ncapacity to pursue a post-secondary education. To this end, the state\nhas developed one of the foremost systems of public higher education in\nthe nation, as well as a substantial program of grants and loans to help\nfinance the education of students attending both public and private\npost-secondary educational institutions.\n Nevertheless, the rising costs to students of post-secondary education\nare placing the goal of such study beyond the financial reach of a\ngrowing proportion of our potential student population, particularly\nthose young men and women coming from families of low- and\nmiddle-income. To effectively meet this fiscal crisis in post-secondary\neducation, which is contrary to the general welfare of our citizens, it\nis hereby found and determined that the student loan programs in the\nstate should be restructured to make available to every student\nfinancial assistance in the attainment of his college or career\neducation and that the state of New York mortgage agency should be\nauthorized to issue its bonds and notes for the purpose of making\navailable funds with which to make available such student loans.\n It is further found and determined that there is a need to establish a\nprogram to assist homeowners in the state of New York who have been\naffected by the national mortgage crisis who are either delinquent on\ntheir mortgage payments or are in danger of going into default because\nof economic hardship, as such term is defined under the agency's\nguidelines, in consultation with the advisory council established in\nsubdivision three of section twenty-four hundred five-f of this part,\nwho may lose their homes to foreclosure, or who may have abandoned their\nhomes due to economic hardship and who may benefit from assistance. In\naddition, the existence of vacant, abandoned, distressed, dilapidated or\nreasonably beyond repair properties may contribute to the persistence of\nconditions that increase blight and add to the deterioration of the\nquality of the environment and living conditions of a large number of\npersons residing in the state. To address these conditions, it is hereby\nfound and determined that the state of New York mortgage agency shall be\nauthorized to create and manage a fund to acquire residences and to\npurchase mortgages and mortgage notes, or to provide monies to eligible\ninstitutions to acquire residences and to purchase mortgages and\nmortgage notes and to carry out such other functions in connection with\nsuch acquisitions as are necessary to accomplish the purposes of this\nparagraph. In connection therewith, the state of New York mortgage\nagency shall be authorized to create a subsidiary corporation to carry\nout the program authorized under this paragraph.\n It is further found and determined that there is a shortage of\nadequate funds to assist in the new construction of modular and\nmanufactured housing, and to assist in the purchase of existing modular\nand manufactured housing.\n