Bill Text: NY A10553 | 2019-2020 | General Assembly | Amended


Bill Title: Imposes a temporary ban on the commencement of mortgage foreclosure actions and the sale of foreclosed properties for 365 days after the last region or county enters into phase 3 of the governor's reopening plan relating to the COVID-19 pandemic.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2020-07-08 - print number 10553b [A10553 Detail]

Download: New_York-2019-A10553-Amended.html



                STATE OF NEW YORK
        ________________________________________________________________________

                                        10553--B

                   IN ASSEMBLY

                                      May 29, 2020
                                       ___________

        Introduced  by COMMITTEE ON RULES -- (at request of M. of A. Hyndman) --
          read once and referred to the  Committee  on  Judiciary  --  committee
          discharged, bill amended, ordered reprinted as amended and recommitted
          to  said  committee  -- again reported from said committee with amend-
          ments, ordered reprinted as amended and recommitted to said committee

        AN ACT to amend the  real  property  actions  and  proceedings  law,  in
          relation  to  imposing a temporary ban on the commencement of mortgage
          foreclosure actions and the sale of foreclosed properties; and provid-
          ing for the repeal of such provisions upon expiration thereof

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section 1. The real property actions and proceedings law is amended by
     2  adding a new section 1393 to read as follows:
     3    §  1393.  Temporary ban on foreclosure actions and sales of foreclosed
     4  properties. 1. Except with respect to a vacant  or  abandoned  property,
     5  state regulated servicers, banks and/or credit unions of a mortgage loan
     6  may  not  initiate any judicial process, move for a foreclosure judgment
     7  or execute a foreclosure-related eviction or foreclosure  sale  of  real
     8  properties  for  twelve  months  after  the date that the covered period
     9  ends.
    10    2. (a) During such  moratorium  period,  state  regulated  mortgagees,
    11  lenders  or  servicers  are  required to either: (i) send the borrower a
    12  notice of default in accordance with the  term  of  the  mortgage  loan,
    13  which  shall  include a list of state certified housing counseling agen-
    14  cies and a list of state funded legal services  where  the  property  is
    15  located.  This  requirement  is not a substitute for the notice required
    16  under section thirteen hundred four of this article; (ii) participate in
    17  the mandatory settlement conference pursuant to rule thirty-four hundred
    18  eight of the civil practice law and rules for  all  pending  foreclosure
    19  actions  including  actions  where  the  mortgagor  appeared  at a prior
    20  settlement conference and the case was marked unsettled.  This  require-
    21  ment  shall  not  apply to pending foreclosure actions where a mortgagor
    22  has not appeared at a prior settlement conference; or (iii)  engage  the
    23  mortgagors  in  a  pre-foreclosure  workout to negotiate in good faith a

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD16379-06-0

        A. 10553--B                         2

     1  modification or forbearance agreements in accordance with  rule  thirty-
     2  four hundred eight of the civil practice law and rules.
     3    (b)  The  mortgagors must demonstrate compliance with this requirement
     4  in order to commence or proceed with  a  foreclosure  action  after  the
     5  covered  period  has expired. Failure to demonstrate compliance shall be
     6  an affirmative defense to the foreclosure action and/or the borrower may
     7  request a bad faith hearing for the lender  or  servicer  non-compliance
     8  with  section  thirty-four  hundred  eight of the civil practice law and
     9  rules. Should the court find the lender or servicer failed to  negotiate
    10  a  modification  or  forbearance  agreement in good faith, the court may
    11  waive all interest accrued on the loan during the moratorium.
    12    3. For the purposes of this section, the  term  "the  covered  period"
    13  shall mean from the date the governor declared a state of disaster emer-
    14  gency  or  March seventh, two thousand twenty until three hundred sixty-
    15  five days after the date the last region and/or county of New York state
    16  entered phase three of the  governor's  reopening  plan  for  the  state
    17  relating to the COVID-19 pandemic.
    18    §  2.  This  act shall take effect immediately and shall expire and be
    19  deemed repealed 1 year after such effective date.
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