Section 339-FF. Mortgage investments on units by state agencies, insurers, banking organizations and fiduciaries; limitation to first mortgages

(a)  The  following  persons:  (1) public officers, bodies of the state,
  municipalities,  and  municipal  subdivisions,  (2)  persons  doing   an
  insurance  business  (as defined by section one thousand one hundred one
  of the insurance law), (3) banking organizations (as defined by  section
  two  of  the  banking law), and (4) executors, administrators, trustees,
  guardians and other fiduciaries, are  authorized  to  invest  in  bonds,
  notes and evidences of indebtedness which are secured by first mortgages
  or  deeds  of  trust  upon  units  and the appurtenant common interests,
  wherever such persons may invest, and subject to all of  the  rules  and
  limitations applicable to such investment, in bonds, notes and evidences
  of  indebtedness  which are secured by first mortgages or deeds of trust
  upon real estate. Where the applicable limitations  are  dependent  upon
  the  type  of  use  of  the  real  estate,  only  the type of use of the
  particular  unit  or  units  which  constitute  the  security  for  such
  investment  shall  be  taken  into consideration for the purpose of such
  limitations. The existence of any prior lien for taxes,  assessments  or
  other  similar  charges  not  yet  delinquent  shall  be  disregarded in
  determining whether a mortgage or deed of trust is a first  mortgage  or
  deed of trust.
    (b) No person enumerated in subdivision (a) of this section may invest
  in  bonds,  notes  or  evidences of indebtedness secured by mortgages or
  deeds of trust upon units and the appurtenant  common  interests,  which
  are   other   than   first   mortgages  or  deeds  of  trust  thereupon,
  notwithstanding any other provision  of  law  (including  section  three
  hundred thirty-nine-g of this chapter).
    (c)  Notwithstanding  subdivisions  (a) and (b), banking organizations
  are authorized, subject to the rules and limitations applicable  thereto
  contained   in   subdivision   four-a  of  section  one  hundred  three,
  subdivision six-a of section two hundred thirty-five, subdivision four-a
  of section three hundred eighty and subdivision eight  of  section  four
  hundred  fifty-six  of the banking law, and the New York job development
  authority is authorized to invest  in  bonds,  notes  and  evidences  of
  indebtedness  which  are secured by mortgages other than first mortgages
  upon units and the appurtenant common interests, provided such mortgages
  are in compliance with title  eight  of  article  eight  of  the  public
  authorities law.
    (d)  Notwithstanding subdivisions (a) and (b) of this section, the New
  York state urban development corporation  is  authorized  to  invest  in
  bonds,  notes  and  evidences  of  indebtedness  which  are  secured  by
  mortgages other than first mortgages  upon  units  and  the  appurtenant
  common  interests,  provided  that (i) such units are owned or are to be
  acquired by a corporation as defined in subparagraph five  of  paragraph
  (a) of section one hundred two of the not-for-profit corporation law and
  are  to  be  used  for  commercial  purposes,  and  such corporation has
  executed a loan authorization agreement with the New  York  state  urban
  development  corporation  on  or before June thirtieth, nineteen hundred
  eighty-eight or (ii) such units are developed as a part of a project  of
  the  New York state urban development corporation that received specific
  authorization in chapter  eight  hundred  thirty-nine  of  the  laws  of
  nineteen   hundred   eighty-seven;   and   further  provided  that  such
  investments and subordinate mortgages are in compliance with chapter one
  hundred seventy-four of the laws of  nineteen  hundred  sixty-eight,  as
  subsequently amended.
    (e)  Notwithstanding subdivisions (a) and (b) of this section, the New
  York city housing development corporation and a city having a population
  of one million or more are authorized to invest  in  bonds,  notes,  and

  evidences  of  indebtedness  which  are  secured by mortgages other than
  first mortgages upon dwelling units and the appurtenant common interests
  provided that such investment is  made  in  connection  with  a  project
  undertaken  pursuant  to  the private housing finance law or the general
  municipal law.
    (f) Notwithstanding subdivisions (a) and  (b)  of  this  section,  the
  division  of  housing  and  community renewal and the housing trust fund
  corporation, their successors and assigns, are authorized to  invest  in
  bonds,  notes,  and  evidences  of  indebtedness  which  are  secured by
  mortgages other  than  first  mortgages  upon  dwelling  units  and  the
  appurtenant  common  interests  provided that such investment is made in
  connection with a project undertaken pursuant  to  the  private  housing
  finance law.