On December 13, the Governor of New York signed into law AB 9686, which amends the New York State banking law by requiring the Superintendent of Financial Services to develop an informational pamphlet titled “What Mortgage Applicants Need to Know” and make the pamphlet available to residential mortgage applicants on the Department of Financial Services website. The legislation requires licensed lenders, mortgage bankers, and other banking organizations to provide the pamphlet to each applicant for a mortgage loan, specifying that lenders may provide the pamphlet by e-mail or by providing a link to the Department’s website.
AB 9686 requires the pamphlet to include 21 key pieces of information, which include specifying that applicants have the right to compare and negotiate loan charges, receive a clear explanation of loan terms, and obtain a loan estimate detailing all charges, including applicable fees, before agreeing to the loan and to file complaints with regulators if the applicant feels that a law was violated. The pamphlet will also remind applicants of their rights to credit counseling, appraisal by an independent professional, and the ability to cancel a refinancing loan within three days of closing.
