Effective as of December 15, 2009 – but with various waiting periods for each section – New York has passed changes and additions to various foreclosure provisions which will have serious impact on foreclosure actions.
Because our readers should benefit from immediately having a sense of what the statute mandates, we will very briefly mention the requirements here. But because there is so much detail, so many anomalies which create imprecision in determining what mortgage lenders and servicers are to do, an in depth review of the statutory requirements and the problems they create will follow in a separate, much lengthier alert.
Here, just as the shortest introduction, is a list of the new requirements in outline form:
- Notice to all tenants concerning their rights to remain at the mortgaged premises must be mailed within ten days of service of the summons and complaint (even if tenants are not being served). (Effective 30 days after December 15, 2009.)
- Ninety-day notice of default to be sent to borrowers for all home loans, including co-ops, (no longer confined to sub-prime or any amount) as a condition precedent to foreclosure. (Effective 30 days after December 15, 2009.)
- Post-sale notice to be given to all tenants or occupants allowing those with a lease (even oral or implied) to remain for the balance of the lease (others to remain for 90 days after notice.) (Effective 30 days after December 15, 2009.)
- Within three business days after mailing the pre-foreclosure ninety-day notice, the lender must file certain information about the mortgage loan with the Superintendent of Banks and then plead compliance with this requirement in any foreclosure complaint. (Effective 60 days after December 15, 2009.)
- Lender to be responsible to maintain property in foreclosure action after “obtaining” judgment of foreclosure and sale until recording of referee’s deed out of a sale. This obligation applies if property is vacant, becomes vacant after judgment, or is tenant-occupied but abandoned by the mortgagor. (Effective 120 days after December 15, 2009.)
- Mandatory conferences for all home loans (one-to-four family owner- occupied) within sixty days of filing proof of service with the court, negotiations to be in good faith. (Effective 60 days after December 15, 2009.
More to follow…
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.