§ 44-B — Mortgage modifications, evidence of pre-existing indebtedness

§ 44-b. Mortgage modifications, evidence of pre-existing indebtedness.\n1. Notwithstanding the provision of any law, general or special, the\nagency shall have the power to:\n (i) consent to and contract for the modification of any of the terms\nof a mortgage, and note or bond secured thereby, made pursuant to this\narticle for the purpose of obtaining insurance of such mortgage loan by\nthe federal government in order to refinance all or any part of the\nindebtedness evidenced by such mortgage and note or bonds, or\n (ii) satisfy such mortgage loan in order to enable the company to\nobtain insurance by the federal government of a mortgage loan made for\nthe purpose of refinancing all or any part of the indebtedness evidenced\nby such mortgage and note or bond.\n Notwithstanding the provisions hereof, the agency on or after June\nfifteen, nineteen hundred seventy-six, shall not modify or satisfy a\nmortgage loan, pursuant to this subdivision one, where the principal\namount of the mortgage loan insured by the federal government is less\nthan eighty-five per centum of the principal amount outstanding on the\noriginal mortgage loan at the time such original mortgage loan is\nrefinanced, unless such modification or satisfaction is first approved\nby the New York state public authorities control board created pursuant\nto article one-A of the public authorities law.\n 2. In the event that the existing mortgage loan is satisfied pursuant\nto this section, the agency may in consideration of the issuance of such\nsatisfaction accept a new mortgage and note or bond insured by the\nfederal government in an amount equal to the maximum principal amount of\na mortgage loan the federal government will insure or accept the\nproceeds available to the housing company as a result of the\nrefinancing.\n 3. In the event that there is residual indebtedness, the housing\ncompany shall make and the agency shall accept an instrument evidencing\nsuch indebtedness in such form and upon such terms as the agency may\napprove, provided that such terms are not inconsistent with subdivision\ntwo of section twenty of this chapter.\n 4. Notwithstanding any other provisions of this article where the\ncommissioner has made the findings required in subdivision one of\nsection twenty-six and where a project has been approved pursuant to\nsubdivision five of section twenty-six of this chapter, the agency may\nmake or contract to make a mortgage loan pursuant to subdivision two or\nthree of this section without further findings by the commissioner or\nfurther approval by the local legislative body.\n 5. No company shall accept a mortgage loan to be insured by the\nfederal government made for the purpose of refinancing the existing\nmortgage loan of a company which shall exceed the amount which can be\nsupported by the income derived from the operation of the project at the\nrental rate determined by the commissioner that would be necessary to\nmeet all necessary payments to be made by the company, of all expenses\nincluding fixed charges, sinking funds, reserves and dividends on\noutstanding stock as authorized by the commissioner, if the principal\namount of the original mortgage loan of the company were to be fully\nrepaid over the term of such mortgage loan by constant and equal\npayments of principal and interest and if the interest rate on the\ncompany's original mortgage loan was eight and one-half percent per\nannum.\n