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Bill > S02670


NY S02670

NY S02670
Makes clarifying changes in regards to the purchase of flood insurance by mortgagors that exceeds certain limits upon a mortgagees request; amends the effectiveness thereof.


summary

Introduced
01/22/2025
In Committee
01/22/2025
Crossed Over
Passed
Dead

Introduced Session

2025-2026 General Assembly

Bill Summary

AN ACT to amend the real property law, in relation to prohibiting mortgagees from requiring mortgagors of certain real property to purchase flood insurance exceeding certain limits; and to amend a chapter of the laws of 2024 amending the real property law relating to prohibiting mortgagees from requiring mortgagors of certain real property to purchase flood insurance exceeding certain limits, as proposed in legislative bills numbers S. 7125-A and A. 5073-A, in relation to the effectiveness thereof

AI Summary

This bill makes clarifying changes to the requirements for flood insurance when mortgagees (lenders) provide loans secured by residential real property. The bill modifies existing law to specify that mortgagees cannot require mortgagors (borrowers) to purchase flood insurance that exceeds the lesser of the replacement value of the residential property or the outstanding principal mortgage balance. Additionally, mortgagees are prohibited from requiring flood insurance that includes contents coverage. The bill also mandates that when requesting flood insurance, mortgagees must provide a notice to mortgagors in clear and conspicuous print, warning that the required insurance may not fully protect the homeowner's interests or cover all potential flood-related damages. The bill changes the effective date from immediate implementation to 90 days after becoming law, giving stakeholders time to prepare for the new requirements. These changes aim to protect homeowners from potentially excessive or unnecessary flood insurance requirements by lenders.

Sponsors (1)

Last Action

SUBSTITUTED BY A2056 (on 02/11/2025)

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