A borrower in New York obtains a reverse mortgage on their primary residence. Under New York law, when is the mortgage recording tax due on this transaction?
Correct Answer
C) When the reverse mortgage is initially recorded, based on the maximum credit line amount
New York mortgage recording tax is due when the reverse mortgage is initially recorded, calculated on the maximum principal amount that could be drawn under the credit line. This follows the general rule that recording tax is due when mortgages are recorded, regardless of when funds are actually disbursed.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Discount points are upfront fees paid to a lender at closing to reduce (buy down) the interest rate on a mortgage loan. One point equals 1% of the loan amount and typically reduces the rate by approximately 0.25%.
An FHA loan is a mortgage insured by the Federal Housing Administration that allows lower down payments and credit scores than conventional loans. It is designed to help first-time homebuyers and borrowers with limited resources.
A fixed-rate mortgage has an interest rate that remains constant for the entire term of the loan, resulting in equal monthly principal and interest payments throughout the life of the mortgage.
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