1. Statutory authority.

Section 6-m of the Banking Law provides for the regulation of subprime home loans as defined in the statute. Pursuant to the authority provided by Section 302(2) of the Financial Services Law, the Superintendent of Financial Services is authorized to interpret the provisions of the Banking Law, including Section 6-m. Part 43 is issued pursuant to this authority, and it applies to all subprime home loans as defined in Section 6-m of the Banking Law.

2. Legislative objectives.

Section 6-m of the Banking Law provides for the regulation of subprime home loans as defined in the statute. The purpose of this proposed regulation is to interpret the meaning of the term “Week” referred to in the phrase the “week prior to the week in which the lender provides the ‘good faith estimate’” used in Section 6-m(1)(c); the term “Good Faith Estimate” referred to in the phrase “‘good faith estimate’ required under 12 USC § 2601 et seq.” used in Section 6-m(1)(c); and the term “Commitment” referred to in the phrase “the time the lender issues its commitment” used in Section 6-m(1)(b).

3. Needs and benefits.

Industry representatives and consumer groups have informed the Department that certain terms used in Section 6-m of the Banking Law are subject to more than one interpretation and requested clarification. Providing this clarification pursuant to statutory authority will benefit the industry and consumers alike by providing interpretations that can be uniformly applied when determining underwriting standards for subprime home loans.

4. Costs.

This proposed regulation will not result in any fiscal implications to the State. It simply interprets the meaning of certain terms appearing in Section 6-m of the Banking Law.

5. Local government mandates.

This regulation does not impose any new programs, services, duties, or responsibilities upon any county, city, town, village, school district, fire district or other special district.

6. Paperwork.

This proposed regulation does not impose any paperwork burden on lenders or borrowers. It simply interprets the meaning of certain terms appearing in Section 6-m of the Banking Law.

7. Duplication.

The proposed regulation does not duplicate, overlap, or conflict with any other regulations.

8. Alternatives.

The Department could choose not to adopt a regulation with respect to interpreting certain terms appearing in Section 6-m of the Banking law. The proposed regulation, however, will provide clarity by providing interpretations that can be uniformly applied when determining underwriting standards for subprime home loans.

9. Federal standards.

There are no applicable federal standards.

10. Compliance schedule.

It is proposed that the regulation be effective upon Notice of Adoption in the State Register.

A Regulatory Flexibility Analysis for Small Business and Local Governments is not being submitted with the regulation because the regulation will not impose any adverse economic impact or any reporting, recordkeeping, or other compliance requirements on small businesses or local governments.

The purpose of this proposed regulation is to interpret the meaning of the term “Week” referred to in the phrase the “week prior to the week in which the lender provides the ‘good faith estimate’” used in Section 6-m(1)(c); the term “Good Faith Estimate” referred to in the phrase “‘good faith estimate’ required under 12 USC § 2601 et seq.” used in Section 6-m(1)(c); and the term “Commitment” referred to in the phrase “the time the lender issues its commitment” used in Section 6-m(1)(b). Pursuant to the authority provided by Section 302(2) of the Financial Services Law, the Superintendent of Financial Services is authorized to interpret the provisions of the Banking Law, including Section 6-m. Part 43 is issued pursuant to this authority, and it applies to all subprime home loans as defined in Section 6-m of the Banking Law. Since nothing in this proposed regulation will create any adverse impacts on any small businesses or local governments in the state, a full Regulatory Flexibility Analysis is not required and therefore one has not been prepared.

A Rural Area Flexibility Analysis is not being submitted with this proposed regulation because it will not impose any adverse impact on rural areas or any reporting, recordkeeping, or other compliance requirements on public or private entities in rural areas. The proposed regulation does not distinguish between regulated parties located in rural, suburban, or metropolitan areas of New York State, but applies universally throughout the state.

The purpose of this proposed regulation is to interpret the meaning of the term “Week” referred to in the phrase the “week prior to the week in which the lender provides the ‘good faith estimate’” used in Section 6-m(1)(c); the term “Good Faith Estimate” referred to in the phrase “‘good faith estimate’ required under 12 USC § 2601 et seq.” used in Section 6-m(1)(c); and the term “Commitment” referred to in the phrase “the time the lender issues its commitment” used in Section 6-m(1)(b). Pursuant to the authority provided by Section 302(2) of the Financial Services Law, the Superintendent of Financial Services is authorized to interpret the provisions of the Banking Law, including Section 6-m. Part 43 is issued pursuant to this authority, and it applies to all subprime home loans as defined in Section 6-m of the Banking Law. Since nothing in this proposed regulation will create any adverse impacts on rural areas in the state, a full Rural Area Flexibility Analysis is not required and therefore one has not been prepared.

A Job Impact Statement is not being submitted with this proposed regulation because it is evident from the subject matter of the regulation that it will not have an adverse impact on jobs and employment opportunities in New York State. The purpose of this proposed regulation is to interpret certain terms appearing in Section 6-m of the Banking Law; specifically, the meaning of the term “Week” referred to in the phrase the “week prior to the week in which the lender provides the ‘good faith estimate’” used in Section 6-m(1)(c); the term “Good Faith Estimate” referred to in the phrase “‘good faith estimate’ required under 12 USC § 2601 et seq.” used in Section 6-m(1)(c); and the term “Commitment” referred to in the phrase “the time the lender issues its commitment” used in Section 6-m(1)(b). The terms as interpreted will not have any adverse impact on jobs or employment opportunities in New York State.