Bill > A05014

This bill enacts the "Home Equity Fraud Act" to protect homeowners, particularly senior citizens and minorities, from predatory lending practices by home improvement contractors, mortgage brokers, and financial institutions. The bill introduces several key protections, including: limiting fees charged by mortgage brokers to no more than 5% or $500, prohibiting mortgage loans with balloon payments or increasing principal balances, requiring full disclosure of loan terms and potential third-party sales, and mandating that foreclosure notices include detailed information about potential defenses. The legislation also extends the home improvement contract cancellation period from three to fifteen business days and provides homeowners with additional legal defenses in foreclosure proceedings. Specifically, homeowners can challenge a foreclosure if they can prove they did not have the financial ability to repay the loan, the mortgage broker violated lending laws, or the mortgage contains prohibited provisions. The bill aims to prevent unethical practices that target vulnerable populations and strip homeowners of their equity, with provisions that make certain predatory loans unenforceable and potentially allow defendants to recover attorney fees.

Business and Industry

https://www.nysenate.gov/legislation/bills/2025/A5014