NY Underwriting Summary

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DRAFT ONLY

Search/Exam

• Minimum Search Requirements -- No Marketable Title Act. 60 years is the standard full search, and may vary by county but the minimum is 40 years. For refinances with loan policy only, it is acceptable to search to the last insured deed or developer's deed.
• Plant or other search restrictions --
• Additional Requirements for REO Searches -- Review the foreclosure.
• Foreclosure Checklist -- Judicial only. Non-judicial foreclosures exist, but are not insurable. Legislation is pending that imposes additional conditions on foreclosure of reverse mortgages. (Cannot be divested in FC: Property taxes, assessments, water and sewer rents and sewer surcharges, emergency repair liens, pest control liens, relocation liens, and unsafe building lis pendens) ((Paul to send checklist and related materials))
• Special Searches Required (Code, HOA, Utilities)? -- the typical search (both purchase and refinance) should include the county clerk, Housing and Building, Fire, Environmental Control Board, and Emergency Repair. ((Lisa to confirm))
• Survey Requirements -- Survey is customarily required to remove exception from owner's policies and loan policies for land improved by other than 1-4 family dwellings.

UPL

Legislation is pending to require, for reverse mortgages, that both the lender and borrower be represented by an attorney at the time of the closing, and each such party shall have at least one attorney present to conduct the closing.

Vesting

• Tenants in Common is presumed without other intent being shown.
• Joint Tenants with Right of Survivorship is recognized, provided joint tenancy language is present.
• Tenants by the Entireties is recognized and is presumed when title is taken by husband and wife, and four unities are present. Deed does not have to state that the grantees are husband and wife, nor must it state the tenancy.

Witness Requirements

• Out of state acknowledgments are accepted, provided they are accompanied by a Certificate of Conformity. (299-a) (CONFIRM WITH SECTION 309-B FORM TEMPLATE)
• Corporate seal is not required

Spousal Joinder Requirements/Homestead

• Non-titled spouse does not have to join in the mortgage.
• Judgment against one person in a valid tenancy by the entireties attaches to the property and must be cleared. If the debtor spouse (or joint tenant) is deceased and spouse (or co-tenant) has taken title, the judgment may be removed.

Construction Liens

• Type 1. General contractor has 8 months (commercial; 4 months single family dwelling) after completion of work or last delivery of materials to file a lien, which is then valid for one year (can be extended.)
• Note, if Lien Law language is included in the mortgage and the Building Loan Agreement is filed prior to closing and funding, and no mechanic's lien is recorded, the mortgage will take priority.

Who May Serve As Trustee On Deed Of Trust

• NY is a mortgage state

Time Limitations

• US Judgment Liens -- 20 years, renewable for 20 years
• State Court Judgment Liens -- 10 years, can be renewed for up to 10 additional years. Attaches to after-acquired property.
• Federal Tax Liens -- 10 years (+30 days); can be refiled
• State Tax Liens -- 10 years
• Estate Tax Lien -- NY Estate tax is 10 years. (Federal 10 years.) NY has no inheritance tax.
• State Inheritance Tax Liens -- Until paid. State Estate Tax may be disregarded in sale from TbE or JT to a BFP; and in a mortgage by surviving TbE or JT; and generally against surviving spouse as TbE; and upon sale or mortgage by heirs, devisees, or distributees of decedent.
• Mechanics Liens -- 1 year, and can be extended for one additional year ((Paul to send ML info))
• Financing Statements -- 5 years +30 days
• Mortgages -- Statute of limitations to foreclose mortgage is 6 years. Ancient mortgage custom (not a statute) is to remove after 12 years.
• HOA Liens -- 6 years from date of recording for condos. HOAs have no statutory basis, so apply contract law - 6 years. Foreclosure of first mortgages can divest HOA and COA liens, but second mortgages cannot.
• Condominium assessments --
• Child Support Liens --
• Lis Pendens is valid for 3 years and renewable for another 3 years, to total 6 years. Do not remove LPs filed by the city.

Odd Stuff

• Entity licensing began in 2014, which requires a sub-licensee with a financial or beneficial interest in the entity, and must hold a title.
• The "Supreme Court" is an appellate court. Highest court in the land is the Court of Appeals.
• Tax sale with recorded deed over ten years old is insurable without quiet title, unless the tax for that year was paid prior to the sale.
• CEMA is a mortgage agreement that consolidates, extends, and modifies prior mortgages, and is used to reduce mortgage tax. Documents should recite all previous mortgages, and if properly prepared, will act as a single mortgage after the consolidation. They are a bit expensive to prepare, so not all transactions will have a CEMA. Tax is charged on the new money only. Lien priority is as of the date of the new money, or most recent new money.
• NYC Code Violations and Building Department Liens are "in personam." If the city expends funds to repair the violation, then the liens will have a "super-priority" status over mortgage foreclosures.
• "Co-ops" are a popular form of ownership, and are considered personal property, not real property. Insuring is risky.
• Rates are set by TIRSA. WFG is a member of the Title Insurance Rate Service Association, Inc.
• CPLs are prohibited in NY.