Servicers Failing to Send Pre-Foreclosure Notices in New York, Delaying Foreclosures

If this is your first visit to my website, welcome! My name is Christine Springer and I'm the founder of Desert Edge Legal Services and the author of the content on this site.

Disclaimer: I’m a paralegal, not an attorney and cannot give you legal advice. This is not meant to be legal advice, and there is no guarantee that the information in this post will work for your individual situation. Please consult with an attorney if you have questions about your individual situation.

Apparently the foreclosing entities in New York are having difficulty complying with a New York law that requires borrowers be sent a 90 day pre-foreclosure notice, according to an article on Law.com that showed up in my Google Alerts.

I didn't link it here because I could only read the segment in the actual alert thanks to a huge popup and paywall on their home page. I had enough to go on without using their link though, so not a huge deal.

I did some digging around elsewhere on this topic and found some fantastic information that will be useful to New York homeowners who may be facing foreclosure there.

Real Property Actions & Proceedings (RPA) Chapter 81, Article 13, Section 1304 says:

“Required prior notices. 1. Notwithstanding any other provision of law, with regard to a home loan, at least ninety days before a lender, an assignee or a mortgage loan servicer commences legal action against the borrower, or borrowers at the property address and any other address of record, including mortgage foreclosure, such lender, assignee or mortgage loan servicer shall give notice to the borrower in at least fourteen-point type…”

I have shortened this considerably, but it is worth following the link back to the New York State Senate where the full length text is transcribed. The rest of §1304 is a form letter for the statutory notice to borrowers. It is supposed to be sent at least 90 days before they initiate a foreclosure proceeding, and this is to give homeowners enough time to work something out with the servicer, or do something else about the foreclosure.

If the servicer can't demonstrate that they mailed the notice to the borrower, they may be required to start the foreclosure process over, which means a significant delay in the case. They have to give the borrower 90 days to fix the problem under state law and that means borrowers will have more time in the home while they come up with an action plan or exit strategy.

It seems odd to me that the banks would be tripped up by this statutory notice requirement when this has been standard language in Deeds of Trust/Mortgages for decades.

Also, the New York courts have several web pages set up to help homeowners in foreclosure.

Here's a link to a page called Common Defenses in a Foreclosure Case, with some good information about defenses, which I found very useful.

Some of the defenses are lack of standing, improper service, partial or full payment, the "Help for Homeowners in Foreclosure" notice was not served with the Summons and Complaint, the aforementioned pre-foreclosure notice was not done the right way, an active servicemember is an owner of the property and is on the mortgage, homeowner's disability or incompetence, the mortgage loan is illegal because the closing or sales process or the mortgage loan terms were unfair.

Here's another link to "Foreclosure Case Basics" which explains what happens and some of the terms.

Finally, here's a very good flow chart for the foreclosure process in New York State.

Disclaimer: This information DOES NOT APPLY in every state. It is specific to the state of New York. Please DO NOT WAIT to seek help if you are in foreclosure.