Prepared by Jason P. Dionisio, Esq. with Shapiro, DiCaro & Barack, LLC serving New York
2019 was a busy year for the default servicing legal community in New York State that culminated with an eventful month of December. As the year came to a close, state laws were enacted relating to marketing, origination, and management of reverse mortgage products that fall under HUD’s home equity conversion program for seniors; the right of the city, village, or town in which the property is located to commence a court proceeding to compel any mortgagees with completing foreclosure actions on abandoned or vacant properties; and standing defense in foreclosure actions.
On December 6, 2019, Governor Cuomo signed Assembly Bill A5626/NYS Senate Bill S4407, enacted as 2019 NY Laws Chap. 581, which amended the Real Property Law by adding Section 280-b. The law provides specific disclosures, notifications, and marketing language restrictions relating to reverse mortgages and aiming to protect borrowers from any lender’s unfair or deceptive practices. The law requires that a property inspection be completed before foreclosing on a mortgaged property based on the mortgagor’s failure to live at the property. Compliance with the requirements of the law is a condition precedent to a foreclosure action, and failure to comply is a complete defense to the foreclosure. Any person, injured by any violation of Section 280-b or any violation of the rules and regulations of HUD relating to the reverse mortgage, may sue to recover treble damages, plus the prevailing plaintiff’s reasonable attorney’s fees. The law will become effective on March 5, 2020, the 90th day after it became a law, but the NYS Department of Financial Services may immediately promulgate regulations to implement this law.
On December 18, 2019, New York State Assembly Bill A01859-A/NYS Senate Bill S05079A, entitled the Zombie Property Remediation Act of 2019, was signed into law, which adds Section 1392 to the Real Property Actions and Proceedings Law (RPAPL). On properties certified as abandoned or deemed vacant and abandoned under RPAPL § 1309, the city, village, or town in which the property is located may commence a proceeding in court to compel mortgagees to:
(1) commence a foreclosure action;
(2) if a foreclosure action has been commenced, to proceed with the next motion; or
(3) issue a certificate of discharge of the mortgage within three months and file a satisfaction of the mortgage with the appropriate local office.
Initially, the onus is on the applicable municipality to commence the action seeking to compel, at which point and only with the appropriate court order, mortgagees would be required to commence and/or proceed with the foreclosure action within the referenced timelines, or discharge the mortgage. The law became effective as soon as it was signed on December 18, 2019.
Both laws require internal process and documentation updates to ensure compliance.
Finally, on December 23, 2019, Governor Cuomo signed New York State Assembly Bill A05619/NYS Senate Bill S05610 into law as 2019 NY Laws Chap. 739, which amended the RPAPL to add section 1302-a. This law makes the lack of standing an unwaivable defense that can be raised at any time prior to the foreclosure sale. Per the language of the law, if a judgment of foreclosure and sale was issued upon default, the defendant can still raise the lack of standing defense post-sale. The law became effective immediately upon execution on December 23, 2019. Our firm anticipates an increase in litigation through the life of a foreclosure action regarding the standing defense.
If you have any questions or need guidance with navigating these new state foreclosure law updates, please contact the attorneys of Shapiro, DiCaro & Barack, LLC, John A. DiCaro at 585-770-2111 or firstname.lastname@example.org, Ellis M. Oster at 585-770-2148 or email@example.com , or Jason P. Dionisio at 585-770-2147 or firstname.lastname@example.org.
The Janeway-LOGS partnership now consists of Janeway Law Firm, P.C., a certified woman-owned law firm serving Colorado since 2004 and affiliated with the LOGS Network since 2013; and Janeway Law Firm, LLC, serving Arizona, California, Oregon, and Washington.
“As a woman-owned law firm, we are excited about this expansion and our growing opportunity to serve our clients across multiple states,” said Lynn Janeway, Esq., Managing Shareholder of Janeway Law Firm, P.C. (Colorado) and Managing Member of Janeway Law Firm, LLC (Arizona, California, Oregon, and Washington).
“With this merger, Lynn’s firm becomes one of the largest woman-owned law firms in the industry and her long career, both as an attorney and businesswoman, is a key differentiator of LOGS’ western states strategy,” said LOGS founder Gerald M. Shapiro, Esq. Shapiro continued, “We are grateful for the foundation of our legacy firms in these states, and LOGS is especially excited about the opportunity to expand the footprint of a woman-owned firm in the region under Lynn’s leadership.”
The name change is effective immediately. Phone numbers and physical addresses in Arizona, California, Oregon, and Washington have not changed. Existing @LOGS.com email addresses remain active and forward into new @JanewayLaw.com email addresses. A new contact matrix for Janeway Law Firm clients has been distributed. Learn more about the firm’s history and expanded footprint by visiting LOGS.com/janeway_law_firm.
About LOGS Network
Founded in 1971, LOGS Network is the nation’s largest, commonly-owned multi-state network of creditors’ rights law firms. LOGS Network offers local legal expertise in 30+ states and the District of Columbia, backed by national operations, technology, and compliance support. Based in Bannockburn, IL, LOGS Network was founded over 40 years ago by Gerald M. Shapiro, Esq. and David S. Kreisman, Esq., who are still actively involved in the day-to-day management of LOGS Network’s 200+ attorneys and 800+ team members. Learn more at LOGS.com or contact LOGS Network at info@LOGS.com.
Prepared by Kathleen Magoon, Supervising Foreclosure Attorney and Christopher DeNardo, Managing Partner, Shapiro & DeNardo, LLC, serving PA + NJ
2019 was a busy year in New Jersey, with nine new statutes enacted that impact mortgage foreclosure. In addition to these statutes, the Legislature and the Courts are heavily promoting borrowers’ entry into the Court’s sponsored Mediation Program.
Further, the Courts and the Office of Foreclosure introduced a new wrinkle in the Mediation Program in that once a borrower accepts a trial loan modification, the Court will close the case. In a measured effort to remove matters from the Docket, the Court takes the position the case will be considered “settled” upon the borrower’s acceptance of an offer of a trial loan modification. While the Court understands that acceptance of a trial plan is only a first step to the actual modification of the loan, it will now treat the case as closed upon this first step and allow it to be reactivated if the borrower defaults on the loan modification while in the trial plan period. To reactivate, Lenders’ counsel must file a certification with the Court within 60 days of the borrower’s default. This certification will advise the Court the date the loan modification was offered, the date the offer was accepted, the date of the borrower’s default, and details as to what triggered the default. If Lenders’ counsel fails to file a certification within 60 days from the borrower’s default, a motion to reinstate the case to active status must then be filed with the Court to proceed with the foreclosure.
It is imperative for lenders and servicers to notify their counsel immediately when a borrower defaults under a trial plan. Doing so will allow plaintiff’s counsel to prepare and file the certification within the 60-day period from borrower’s default, permitting plaintiff to move with a certification to reactivate the foreclosure action. Otherwise, plaintiff will have to file a motion to reinstate the foreclosure to active status, adding to further delay the foreclosure.
To learn more about this new requirement, or any of the nine statutes enacted in 2019, contact Attorney Magoon at email@example.com or (856) 793-3080, ext. 3437 for additional information or questions.
This blog post is provided for educational and informational purposes only and is not intended and should not be construed as legal advice or used as a substitute for competent legal advice. By using this information, you understand that there is no attorney-client relationships between you and the author of this post.