Section 111. Mortgages and mortgage bonds

Any  redevelopment company,
  subject to the approval of the supervising agency, may borrow funds  and
  secure  the  repayment  thereof  by  bond and mortgage or by an issue of
  bonds under a trust indenture. Each mortgage or  issue  of  bonds  of  a
  redevelopment  company  shall  relate only to a single specified project
  and to no other and such bonds shall be secured by mortgage upon all  of
  the real property of which such project consists.
    First  lien  bonds  of  such  redevelopment  company when secured by a
  mortgage not exceeding ninety per centum of the estimated cost prior  to
  the  completion  of  the  project,  and in no event exceeding ninety per
  centum of the actual cost upon such  completion,  as  certified  by  the
  supervising  agency,  or,  in  the  case  of  a  completed  project, not
  exceeding ninety per centum of the appraised value  or  such  previously
  certified actual cost, whichever is less, are hereby declared securities
  in  which  all  public  officers  and  bodies  of  the  state and of its
  municipal subdivisions, all insurance companies  and  associations,  all
  savings  banks  and  savings  institutions,  including  savings and loan
  associations, executors, administrators,  guardians,  trustees  and  all
  other fiduciaries in the state may properly and legally invest the funds
  within their control.
    First  lien bonds of such a redevelopment company issued under a trust
  indenture and pursuant to a building loan contract, or a  building  loan
  bond  and  building loan mortgage under which advances are made pursuant
  to a building loan contract, where the aggregate principal amount to  be
  issued  or  advanced  does not exceed ninety per centum of the estimated
  cost prior to the completion of the project, and in any event  does  not
  exceed  ninety  per  centum  of the actual cost upon such completion, as
  certified by the supervising agency, are hereby declared  securities  in
  which all banks, savings banks, savings institutions and trust companies
  in  addition  to  all  such  officers,  bodies, companies, associations,
  institutions and fiduciaries may properly and legally invest  the  funds
  within their control; provided, however, that such investment is made as
  a  construction  loan  with  a  maturity of not to exceed two years. The
  maturity of any such construction loan may be extended from time to time
  with the approval of the board of directors or  trustees  of  the  bank,
  savings  banks,  savings institutions or trust company holding such loan
  but no one such extension shall be for a period of  time  exceeding  six
  months.
    The  bonds  so  issued and secured and the mortgage or trust indenture
  relating thereto, may create a first or senior lien and a  secondary  or
  junior  liens  upon the real property embraced in any project; provided,
  however, that the total mortgage  liens  shall  not  exceed  ninety  per
  centum of the estimated cost prior to the completion of the project, and
  shall  not in any event exceed ninety per centum of the actual cost upon
  such completion, or, in the case of a completed project,  not  exceeding
  ninety  per  centum  of the appraised value or such previously certified
  actual cost, whichever is  less.  Such  bonds  and  mortgages  or  trust
  indentures  may  contain  such  other clauses and provisions as shall be
  approved by the supervising agency, including the right to assignment of
  rents and entry into possession in case of default and including in  the
  case  of  a  redevelopment  company  which is a partnership or trust the
  right of the partners or trustees, as the case may be, to be free of any
  personal liability thereunder; but the operation of the housing  project
  in  the event of such entry by mortgagee or receiver shall be subject to
  regulations promulgated by the supervising agency.  Provisions  for  the
  amortization  of  the bonded indebtedness of companies formed under this
  article shall be subject to the approval of the supervising  agency.  So
  long   as  funds  made  available  by  the  federal  government  or  any

  instrumentality thereof or any mortgage or mortgage  bonds,  insured  by
  the  federal  housing  administrator or any other instrumentality of the
  federal government are used in financing,  in  whole  or  in  part,  any
  project  under  this  article,  the capital structure of a redevelopment
  company undertaking such project and the  proportionate  amount  of  the
  cost  of  the  lands  and improvements to be represented by mortgages or
  bonds shall be entirely in the discretion of the supervising agency; and
  all restrictions as to the maturity of any construction loan and  as  to
  the  amounts  to  be  represented  by  mortgages, mortgage bonds, income
  debentures or capital shall be  inapplicable  to  such  projects  or  to
  redevelopment  companies  undertaking  such  projects,  except  that the
  bonds, mortgages, debentures and capital covering any project shall  not
  exceed  the  total  actual  final  cost  of  such  project as defined in
  subdivision two of section one hundred twelve of this article.
    Interest rates on mortgage indebtedness shall not exceed  the  greater
  of
    (a) six percentum per annum,
    (b)  the  rate  prescribed  by  the  banking board pursuant to section
  fourteen-a of the banking law,
    (c) the rates of mortgages or mortgage bonds insured  by  the  federal
  housing  administration  or  any  other  instrumentality  of the federal
  government and (d) such rate as  may  be  approved  by  the  supervising
  agency  provided,  however,  that  the  applicable  rate for purposes of
  paragraphs (b), (c) and (d), of this section one hundred eleven shall be
  the rate applicable or approved at the time  the  redevelopment  company
  incurs the mortgage indebtedness.
    As  used in this section the term "bond" includes a note heretofore or
  hereafter made.