New York S01323 prohibits pre-payment penalties for mortgages on cooperative properties where over 50% of units are shareholder-occupied.

New York S01323 amends the general obligations law to prohibit pre-payment penalties for mortgages secured by real property in a cooperative form of ownership where more than fifty percent of the units are occupied by shareholders. This means that if a mortgagee prepays their mortgage, they will not be charged a penalty fee. The right to prepay must be stated in the loan or forbearance instrument, but the provisions do not apply if they conflict with federal law or regulation. This act takes effect immediately.

New York S01323 prohibits pre-payment penalties for mortgages on cooperative properties where over 50% of units are shareholder-occupied.

New York S01323 amends the general obligations law to prohibit pre-payment penalties for mortgages secured by real property in a cooperative form of ownership where more than fifty percent of the units are occupied by shareholders. This means that if a mortgagee prepays their mortgage, they will not be charged a penalty fee. The right to prepay must be stated in the loan or forbearance instrument, but the provisions do not apply if they conflict with federal law or regulation. This act takes effect immediately.