N.Y. General Obligations Law § 5-602: Interest on insurance draft deposits in escrow with mortgage investing institutions

§ 5-602. Interest on insurance draft deposits in escrow with mortgage

investing institutions. Any mortgage investing institution which

maintains an escrow account pursuant to any agreement executed in

connection with a mortgage or any loan, secured by a lien on any one to

six family residence occupied by the owner or on any property owned by a

cooperative apartment corporation, as defined in subdivision twelve of

section three hundred sixty of the tax law, (as such subdivision was in

effect on December thirtieth, nineteen hundred sixty), and located in

this state and which residence or cooperative apartment corporation

received from an insurance carrier a draft, forwarded to a mortgage

investing institution, as compensation for damage done to a residence

shall, for each quarterly period in which such escrow account is

established, credit the same with dividends or interest at a rate of not

less than two per centum per year based on the average of the sums so

paid for the average length of time on deposit or a rate prescribed by

the superintendent of financial services pursuant to section fourteen-b

of the banking law and pursuant to the terms and conditions set forth in

that section whichever is higher. The superintendent of financial

services shall prescribe by regulation the method or basis of computing

any minimum rate of interest required by this section and any such

minimum rate shall be a net rate over and above any service charge that

may be imposed by any mortgage lending institution for maintaining an

escrow account. No mortgage investing institution shall impose a service

charge in connection with the maintenance of an escrow account unless

provision therefor was expressly made in a loan contract executed prior

to the effective date of this section.