1804-A - Deed in lieu of foreclosure.

§  1804-a.  Deed  in  lieu  of foreclosure. 1. The authority is hereby  authorized to require at the time of the making of the loan or  issuance  of  the  loan guarantee, or at any time thereafter, in a form acceptable  to it, a deed to all rights  and  interests  in  the  real  or  personal  property, as a security interest, such deed to be termed a "deed in lieu  of  foreclosure",  and  is  empowered  hereby to record such deed upon a  default in the payment or terms of any loan made or  guaranteed  by  the  authority.  By  such  recording  title to and all rights of ownership in  such  property  shall  be   thereby   transferred   to   the   authority  notwithstanding  the  existence of any other deeds which are, or may be,  recorded after the filing of a notice by the  authority  concerning  the  existence  of  such  deed  in  lieu  of  foreclosure  in accordance with  subdivision six of this section and such later recorded deeds except for  the deed in lieu of foreclosure shall be void and unenforceable.    2. Notwithstanding such transfer, all liens upon such  property  which  are  duly  perfected  prior  to  the  recording  of such deed in lieu of  foreclosure, including any lien of the authority, shall continue in full  effect and shall be subject to foreclosure at the suit  of  any  of  the  lienholders,  including the authority, and such lienholders' mortgage or  other security interest shall not be deemed merged or  unenforceable  by  such transfer.    3.  Such  deed  given  prior  to recording shall be fully effective in  passing title and all rights of ownership upon recording thereof by  the  authority  notwithstanding  the  passage  of  time  or  changes  in  the  ownership and officers of the project owner.    4. Notice that such deed  in  lieu  of  foreclosure  exists  shall  be  recorded  in  the  office  of the clerk of the county where such real or  personal property is situated and shall be in  the  form  prescribed  in  subdivision six of this section.    5.  After  the  recording of such deed by the authority, the authority  shall commence a foreclosure action upon its  lien  within  one  hundred  twenty days in accordance with the real property actions and proceedings  law.  The  grantor  and  former  project owner may commence an action to  compel the authority to foreclose its lien after such  period  of  time,  and  is  entitled  to  the excess of funds received from the foreclosure  sale over the total liens outstanding on the property.    6. Such notice shall be in the form of a deed,  duly  acknowledged  by  the grantor and stating on its face "This is a security interest held by  the  New  York  job  development  authority  and shall pass title to the  within described property upon the recording of such deed in  accordance  with section eighteen hundred four-a of the public authorities law".