Skip to Content

Press Release
Banking Department Confirms New York Lenders' Ability to Participate in Hope for Homeowners Program

May 1, 2009

New York, N.Y.: The New York State Banking Department today issued a legal opinion stating that New York lenders are able to participate in the federal Hope for Homeowners program.

The program is designed to help borrowers at risk of default or foreclosure to refinance into affordable 30 year FHA-insured mortgages.  The Hope for Homeowners program was intended to be of particular benefit to troubled borrowers with interest only, payment option, negative amortization or other exotic loan features.

Among other conditions, the program requires that the borrower agree to share with the U.S. Department of Housing and Urban Development (HUD) 50 percent of any future property appreciation upon the sale of the property. This amount would be secured by a shared appreciation mortgage.   

In an opinion letter on the issue, the Banking Department concluded that New York Lenders may participate in the Program.  Although the Banking Law does not authorize shared appreciation mortgages as a type of “alternative mortgage,” Section 201 of the Unconsolidated Laws creates a separate grant of authority for corporations subject to the Banking Law to participate in programs insured by the FHA, which would include the Hope for Homeowners program.

The opinion letter is available on the Banking Department Web site at

TheNew York State Banking Department is the regulator for all state-chartered banking institutions, virtually all of the United States offices of international banking institutions, all of the State’s mortgage brokers, mortgage bankers, check cashers, money transmitters and budget planners. The aggregate assets of the depository institutions supervised by the Banking Department are more than $2.4 trillion.

In addition to regulating banking institutions, the Banking Department is active in informing and educating all New Yorkers on banking matters. To contact the Banking Department, please call 1-877-BANK-NYS or visit our Web site at

Department of Financial Services


DFS Facebook page

Follow NYDFS on Twitter


Sign up online or download and mail in your application.