To enhance the maintenance and scope of our support for loans secured by shares in cooperatives in New York, we will be providing new, modified copies of some of FNMA’s and FHLMC’s uniform notes and riders for these types of loans. Changes to the uniform documents include the following:
- Modifying the titles to the documents by including the caption “Cooperative Apartment”, to distinguish the documents from ones given for real estate-secured properties;
- Modifying the text in the footer of the documents by adding the caption “- Modified for Cooperative Loans”, to indicate that the documents contain deviations from FNMA’s and FHLMC’s uniform text;
- On the promissory notes, modifying the section entitled “Uniform Secured Note” to contain text matching Section 11 of our generic “Loan Security Agreement – COOP” (Cx4987). For the ARM notes, the text will also match the language of Section 11, but as amended by the ARM riders; and
- On the ARM riders, modifying the text of Section B to make the provisions concerning assumptions and transfers of beneficial interests compatible with cooperative loans. Doing so will effectively amend Section 11 of Cx4987. This language will also be reflected in the modified “Uniform Secured Note” section of the ARM promissory notes.
We will be releasing these changes as we complete them (and will update this announcement accordingly). Our first batch of changes includes the following documents:
- 3200 Note Fixed (Cx5)
- 3522 Note ARM 1 Yr Treasury (Cx75)
- 3501/3502 Note ARM 1/1 3/1 1 Yr Treasury (Cx142)
- 3271 Interest-Only Note Fixed Note (Cx299)
- 3111/3108 Rider ARM 1/1 3/1 1 Yr Treasury (Cx731)
- 3182 Rider ARM 1 Yr Treasury (Cx754)
- 3531 Interest-Only Note ARM 1 Yr Treasury (Cx820)
- 3533 Interest-Only ARM Note (Cx3174)
- 3534 Multi 1 Yr Treasury Ten-Year Interest Only Note (Cx6125)
- 3111/3108 Rider ARM 1/1 3/1 1 Yr Treasury (Cx7695)
- 3152 1 Year Treasury 10 Yr Interest Only Rider (Cx9029)
- 3182 Rider ARM 1 Yr Treasury (Cx9387)
These changes will appear on these documents under the following conditions:
- Cooperative (FI 22537) = Yes
- Property State (FI 1714) = New York
We will also be modifying the print configuration for our 3200 Note Fixed (Cx5), which is currently configured to print when “Cooperative = No” in all cases. Cx5 will be given an additional configuration so that it will print when “Cooperative = Yes” and “State Code = New York”. 3200 Note Fixed will not print for cooperatives in any other state beside New York. Our current, generic “Cooperative Apartment Fixed Rate Note” (Cx4992) will continue to print for cooperatives in all states, but will be modified to not print when “State Code = New York,” since Cx5 will print instead. The ARM notes and riders will continue to print for cooperatives in all states.
Additionally, we will be modifying the text of the “Uniform Secured Note” section of Cx4992, so that the language which restates the language of Section 11 of Cx4987 will match such language. We will also modify some of the text of Section 11 of Cx4987 for grammatical purposes, particularly changing the clause “(or if a beneficial interest in me is sold or transferred and I am not a natural person)” to “(or if I am not a natural person and a beneficial interest in me is sold or transferred)”.
These first batch of changes will take effect on March 6, 2018. If you have any questions or concerns about these changes, please contact Client Support at 1.800.497.3584.