Bulletin: NY000506

Date:
July 19, 2012
To:
All New York State Agents, Office Counsel and Managers
RE:
$10,000 Residential Property Exclusion on Certain Mortgages

The New York State Department of Taxation and Finance, Taxpayer Guidance Division issued on July 5, 2012 Tax Bulletin TB-MR-5 explaining when $10,000 of the principal debt or obligation can be excluded from the computation of the additional tax component of the mortgage recording tax where the real property is principally improved or to be improved by a one- or two-family residence or dwelling.  This bulletin clarifies previous advice of the Department. The $10,000 exclusion:

  1. Applies only once to each mortgage that is not supplemental to a previously recorded mortgage.
  2. Does not apply to any instrument modifying a previously recorded mortgage that originally secured an indebtedness or obligation of $10,000 or more.

The exclusion applies to a new mortgage (gap) which then is consolidated. However, it does not apply to a mortgage increased by means of a mortgage amendment or modification.  Stewart’s rate calculator has been updated accordingly. If you have any questions regarding this bulletin please contact John A. Frates, Esq. at jfrates@stewart.com or call 212-922-0050 and speak with any Agency Legal Services counsel.

THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER  AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.

References

Bulletins Replaced:
None
Related Bulletins:
None
Underwriting Manual:
None
Exceptions Manual:
None
Forms:
None