Delays In New York Foreclosure – New Rule May Help


15 January, 2006


Mortgage Lender and Servicer Alerts

Servicers around the nation know the problem:  mortgage foreclosure actions can often move slowly in New York because of court delays.  While this is a particular concern in the heavily populated downstate areas [New York City, Long Island (Nassau and Suffolk Counties) and Westchester County], court backlogs are hardly unknown in some upstate areas as well.  In any event, New York is a litigious state and case volume can lead to clogged calendars.

All this is particularly vexing for mortgage servicers for the obvious reason that time is money; interest on the mortgage accrues daily.  So, if a borrower decides to buy time by submitting an answer, a decision on the now necessary motion for summary judgment delayed for months, hurts.  Even a simple motion for appointment of a referee can sit too long – and there are other motion stages in a New York mortgage foreclosure case.

Court rules in New York have long required judges to issue a decision upon a motion within 60 days after final submission.  But mortgage servicers know all too well that the world does not always work that way.  Decisions can be held for many months more than that.

The dilemma for servicer’s counsel was that an inquiry about an overdue decision or order status might alienate the court, thus requiring such correspondence to be used quite sparingly.  But amendment to a court rule effective January 17, 2006 may change this.  (Uniform Civil Rules for the Supreme and County Courts §202.8.)  The new version removes the possible stigma attached to contacting the judge.  Now, if there is no decision within 60 days, counsel for the moving party must send a letter to the court alerting it to the lateness (with copies to all parties).

What happens if the letter is not sent is unstated.  Nor is there any affirmative statement of what the court must do upon receipt of the letter.  But the message is not so subtle.  This suggests that judges will need to focus more upon the 60 day rule and attorneys who so advise are just doing what rules mandate.  This could help case progress.

Mr. Bergman, author of the four-volume treatise, Bergman on New York Mortgage Foreclosures, LexisNexis Matthew Bender (rev. 2017), is a partner with Berkman, Henoch, Peterson, Peddy & Fenchel, P.C. in Garden City, New York. He is also a member of the USFN, The American College of Real Estate Lawyers, The American College of Mortgage Attorneys, an adviser to the New York Times on foreclosure issues and writes a regular servicing column for the New York Law Journal. He is AV rated by Martindale-Hubbell, his biography appears in Who’s Who In American Law and he has been for years listed in Best Lawyers In America and New York Super Lawyers.