Section 589. Declaration of policy

The origination, funding and servicing
  of residential mortgage loans and the  types  of  entities  involved  in
  residential mortgage lending has undergone significant changes in recent
  years,  due in part to developments in the general economy, specifically
  interest rate volatility, the sophistication of the  national  secondary
  market for mortgage loans and the market for mortgage-backed securities.
  The  recent trend toward deregulation in the financial services industry
  has  accelerated  the  evolution  of   residential   mortgage   lending,
  dramatically  increasing  the  types  of  mortgage loans offered and the
  manner  in  which  they  are  advertised  and  marketed  to   consumers.
  Depository  institutions,  traditionally the major source of residential
  mortgage  financing  for  individuals,  now  compete  for  capital   and
  customers   with   mortgage   bankers   and   other   financial  service
  organizations.  Residential  mortgage  lenders  of   every   type   have
  increasingly  relied  on  non-financial intermediaries, such as mortgage
  brokers, to make loans available to consumers. These  developments  have
  raised  questions  as  to  whether all entities engaging in this banking
  function operate under appropriate regulatory scrutiny and as to whether
  all residential mortgage lenders are conducting their  business  in  the
  best interests of New York homeowners and potential homeowners.
    The  activities  of  lenders  and  their agents offering financing for
  residential real property have a direct and immediate  impact  upon  the
  housing  industry,  the neighborhoods and communities of this state, its
  homeowners and potential homeowners. The legislature finds  that  it  is
  essential  for  the  protection  of  the  citizens of this state and the
  stability of the state's economy that reasonable standards governing the
  business practices of mortgage lenders and their agents be imposed.  The
  legislature  further  finds  that  the  obligations of lenders and their
  agents to consumers in connection with making,  soliciting,  processing,
  placing  or  negotiating  of  mortgage  loans are such as to warrant the
  uniform  regulation  of  the  residential  mortgage   lending   process,
  including   the  application,  solicitation,  making  and  servicing  of
  mortgage loans.   Consistent with the  purposes  of  promoting  mortgage
  lending  for  the  benefit  of  our citizens by responsible providers of
  mortgage loans and services and avoiding requirements inconsistent  with
  legitimate  and  responsible  business practices in the mortgage lending
  industry, the purpose of this article is to protect New  York  consumers
  seeking  a  residential  mortgage  loan  and to ensure that the mortgage
  lending industry is operating fairly,  honestly  and  efficiently,  free
  from deceptive and anti-competitive practices.