(c) An application for authority to make
reverse mortgage loans must be made in accordance with the following, as
applicable:
(1) Any person or entity licensed
pursuant to section
591 of the Banking Law must apply to the
Department for authority to make reverse mortgages loans and demonstrate, to
the satisfaction of the superintendent, the following:
(i) The lender satisfies the financial
responsibility requirements set forth in section
410.1
of the Superintendent's Regulations and:
(a)
as it relates to the origination of R PL 280 and R PL 280 -a loans, maintains
an irrevocable standby letter of credit in favor of the lender:
(1) The irrevocable standby letter of credit
must meet the following criteria:
(A)the
initial term is at least two years;
(B) it is provided by a financial institution
that is not affiliated with the lender; and
(C) it is in an amount necessary to fund all
reverse mortgage loan requirements anticipated to be made over the next 12
rolling months or an amount to be determined by the superintendent and
published on the Department's website, whichever is greater.
(2) The standby letter of credit
requirements above do not apply to the origination of a loan:
(A)which is closed during a period of time
when the lender has held a rating of either 4A1 or 5A1 from Dun &
Bradstreet Credit Services for the immediately preceding three consecutive
years; or
(B) the proceeds of which
are fully dispersed at the loan closing.
(b) as it relates to the origination of R PL
280 -b loans, maintains authorization from the Federal Housing Administration
("FHA") to originate FHA loans.
(ii) As it relates to the origination of R PL
280, 280-a and 280-b loans, at the time of application and for as long as the
lender makes reverse mortgage loans, the lender will maintain a minimum capital
amount as published on the Department's website. A lender may rely on the
capital of its parent to satisfy the requirements of this subdivision provided
that for any year in which a lender seeks to so rely, it shall provide to the
Department a certified financial statement of the parent showing a net worth of
at least an amount to be determined by the superintendent and published on the
Department's website, as of the close of its most recent fiscal year and a
binding written commitment from the parent to the entity to make a minimum of
such amount available to the lender as a capital contribution in connection
with its reverse mortgage lending program; and
(iii)The following documents, as applicable,
must be provided with any application made pursuant to section 79.3(c):
(a) a copy of the standby letter of
credit;
(b) an audited financial
statement for the most recent fiscal year;
(c) a copy of the lender's report issued by
A.M. Best Company;
(d) a copy of
the lender's approval letter authorizing the origination of FHA
loans;
(e) proof of the lender's
4A1 or 5A1 rating from Dun & Bradstreet Credit Services; and
(f) such other information and documents as
shall be requested by the superintendent.
(2) The application provisions of subsection
(1) above shall not apply to exempt organizations provided that such exempt
organization notifies the superintendent that it is making reverse mortgage
loans in this State and submits the following information and documents as
applicable:
(a) the name, address, telephone
number, and principal place of business of the exempt organization;
(b) the name of an executive officer
responsible for the exempt organization's reverse mortgage loan
program;
(c) the basis for its
exemption pursuant to section
590(1)(e) of the Banking
Law;
(d) the designation by any
out-of-state exempt organization of an agent within the State of New York for
service of process for any matter arising from a reverse mortgage
loan;
(e) a copy of any trust
agreement entered into between the exempt organization and a trustee pursuant
to section
79.5(g)(2)
of this Part;
(f) the name,
address, telephone number, and principal place of business of any trustee and a
designation in accordance with the requirements of section
131(3) of the Banking
Law.
(g) such other information and
documents as shall be requested by the superintendent.
