N.Y. Comp. Codes R. & Regs. tit. 20 § 645.1

Current through Register Vol. 46, No. 51, December 18, 2024

Section 645.1 - Supplemental mortgages

Tax Law, § 255

(a) A supplemental mortgage is an additional instrument or mortgage which is recorded subsequent to the recording and prior to the discharge or satisfaction of a prior primary mortgage on which all taxes, if any, accrued under article 11 of the Tax Law have been paid, the terms of which make reference to the prior recorded primary mortgage, and which is given and recorded:

(1) for the purpose of correcting or perfecting such prior recorded primary mortgage;

(2) pursuant to some provision or covenant in such prior recorded primary mortgage;

(3) for the purpose of providing additional or further security for the payment of the principal debt or obligation secured by the prior recorded primary mortgage by spreading the lien of the prior recorded primary mortgage to additional real property or by imposing a new lien on such additional real property (see section 645.2[c], [d], [e] or [f] of this Part); or

(4) for the purpose of coordinating or consolidating the liens of prior recorded primary mortgages to form a single and coordinate equal lien; or

(5) for the purpose of modifying a prior recorded primary mortgage, for reasons including but not limited to the following:

(i) adjusting the term for the payment of the debt secured by the prior recorded primary mortgage;

(ii) changing the interest rate on the debt secured by the prior recorded primary mortgage;

(iii) substituting a new mortgagor for the mortgagor;

(iv) substituting a new mortgagee for the mortgagee due to an assignment of the mortgage;

(v) evidencing a change in the amount of debt or obligation which is secured or which under any contingency may be secured by the prior recorded primary mortgage; or

(6) for the purpose of severing the lien(s) of a prior recorded primary mortgage or mortgages into separate liens.

(b) Examples of supplemental mortgages.

Example 1:

The proper mortgage recording taxes were paid upon the recording of a mortgage containing an error in the description of the real property covered by the mortgage. An instrument recorded for the purpose of correcting the description constitutes a supplemental mortgage.

Example 2:

The proper mortgage recording taxes were paid upon the recording of an agreement to give a mortgage, and later the mortgage is given and recorded. The subsequent mortgage is a supplemental mortgage.

Example 3:

The proper mortgage recording taxes were paid upon the recording of a taxable executory contract, which provides for the subsequent giving of a purchase money mortgage to the contract vendor. The mortgage given in accordance with the terms of the contract constitutes a supplemental mortgage.

Example 4:

The proper mortgage recording taxes were paid upon the recording of a building and loan mortgage. The building and loan mortgage provided that the mortgage, upon completion of the construction project, shall be divided into two separate mortgages to be executed between the parties to the original building and loan mortgage. The building and loan mortgage also provides that it will be satisfied when the two separate mortgages are given. The latter two separate mortgages would constitute supplemental mortgages.

Example 5:

The proper mortgage recording taxes were paid upon the recording of a mortgage covering parcel A. An instrument is later recorded for the purpose of spreading the lien of the mortgage to include parcel B. Such instrument would constitute a supplemental mortgage.

Example 6:

In 1985, a mortgage is given to Bank X by Mr. Smith. The note secured by the mortgage provides for an adjustable rate of interest. In 1991 the terms of the note are amended to provide a fixed rate of interest and the mortgage is modified accordingly. Such agreement is a supplemental mortgage.

N.Y. Comp. Codes R. & Regs. Tit. 20 § 645.1