§ 472. Loans to owner-occupants. 1. Notwithstanding the provisions of any general, special or local law, a municipality, acting through an agency, is authorized to make, or contract to make, loans to low and moderate income owner-occupants of one to four unit existing private or multiple dwellings within its territorial limits, subject to the limitation of subdivisions two through seven of this section, in such amounts as shall be required for the rehabilitation of such dwellings, provided, however, that such loans shall not exceed sixty thousand dollars per dwelling unit. Such loans may also include the refinancing of the outstanding indebtedness of such dwellings, and the municipality may make temporary loans or advances to such owner-occupants in anticipation of permanent loans for such purposes.

2. Each loan shall be evidenced by a note executed by the owner-occupant of the existing dwelling. Repayment of each such note shall be within a period of the probable life of the existing dwelling which is hereby determined to be thirty years, or such shorter period as the agency shall determine. The repayment shall be made in such manner as may be provided in such note and contract, if any, in connection with such loan, and may authorize such owner-occupant, with the consent of the agency, to prepay the principal of the loan subject to such terms and conditions as therein provided. In order to make any such loan affordable to the owner-occupant, the agency may provide in such note and contract that all of the outstanding principal of said loan may be self-liquidated over a fifteen year period of owner-occupancy. Such note and contract may contain such other terms and provisions not inconsistent with the provisions of this article as the agency may deem necessary or desirable to secure repayment of the loan, the interest thereon, if any, and other charges in connection therewith, and to carry out the purposes and provisions of this article.

3. The agency in its discretion may require that the owner-occupant execute, acknowledge and deliver a uniform commercial code financing statement for the real property improvement to be in such form as the agency shall specify and in accordance with the requirements of section 9--502 of the uniform commercial code of the state of New York. Said financing statement shall be filed or recorded without charge in accordance with the provisions of paragraph one of subsection (a) of section 9--501 of the uniform commercial code, and from the date of such filing the municipality shall have a lien against said real property improvement for the amount advanced or so much thereof as remains unpaid together with the interest thereon. Upon payment of all sums advanced by the municipality and interest thereon, and upon demand of the then record owner of the real property, the agency shall deliver a copy of the financing statement with an endorsement thereon that the lien is satisfied. Upon filing of such copy in the office where the financing statement was filed and upon payment of the proper fee therefor, the lien of such financing statement shall be discharged.

4. The agency may require the owner-occupant to execute a mortgage as security for a loan in lieu of or in addition to a financing statement as provided in subdivision three of this section. Such mortgage shall contain such terms and provisions not inconsistent with the provisions of this article as the agency shall deem necessary or desirable to secure repayment of the loan.

5. Loans may be made with respect to a one to four unit private or multiple dwelling encumbered by mortgages, provided no mortgage is in default, except if such default shall be remedied by the proposed rehabilitation or improvement.

6. The agency may charge the owner-occupant of such existing private or multiple dwelling reasonable fees for administration, financing, regulation, supervision and audit.

7. In making a loan under this article, an agency shall have the power to participate in a loan made by any private investor, provided that the portion of the loan funded by the agency shall not exceed an amount equal to seventy-five percent of the total loan. The agency may enter into an agreement with a private investor to deposit funds with such private investor to cover the agency's participation in loans to owner-occupants of one to four unit existing private and multiple dwellings with such funds advanced by such private investor to owner-occupants of existing dwellings. The portion of the loan funded by the agency may be equal to or subordinate in lien to the portion of the loan funded by the private investor and the note and contract may contain such terms with respect to interest rate, if any, and time of payment of principal and interest as determined by the agency. The agency may make provision, either in the mortgage or mortgages or by separate agreement, for the performance by the private investor of such services as are generally performed by a banking institution which itself holds a mortgage, including, without limitation, construction loan advances, construction supervision, initiation of foreclosure proceedings, procurement of insurance, and all other matters in connection with the financing, supervision, regulation and audit of any such loan. In order to make the loan affordable to the owner-occupant, the agency may provide an interest reduction subsidy pursuant to section four hundred seventy-five of this article, or may provide that all or part of the agency's portion of the outstanding principal of any such participation loan may be self-liquidated over a fifteen year period of owner-occupancy.