Bill Text: NY S00697 | 2011-2012 | General Assembly | Amended

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Bill Title: Provides that only the owner and holder of a mortgage and note, or its agent, shall have standing to commence a mortgage foreclosure action; lack of standing shall be defense that may be raised at any time; requires the plaintiff in a foreclosure action to affirm that it is the holder and owner, or its designed agent, of the subject mortgage and note; provides that the summons and complaint shall include a copy of the original mortgage and note, and all endorsements, assignments and transfers thereof, and any delegations of authority by the owner and holder of the mortgage and note.

Spectrum: Slight Partisan Bill (Democrat 8-4)

Status: (Introduced - Dead) 2012-01-04 - REFERRED TO HOUSING, CONSTRUCTION AND COMMUNITY DEVELOPMENT [S00697 Detail]

Download: New_York-2011-S00697-Amended.html

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                           S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
                                        697--A
                              2011-2012 Regular Sessions
                                   I N  S E N A T E
                                      (PREFILED)
                                    January 5, 2011
                                      ___________
       Introduced  by  Sens. KLEIN, GRISANTI, KRUEGER -- read twice and ordered
         printed, and when printed to be committed to the Committee on Housing,
         Construction and Community Development -- committee  discharged,  bill
         amended,  ordered reprinted as amended and recommitted to said commit-
         tee
       AN ACT to amend the  real  property  actions  and  proceedings  law,  in
         relation to standing to commence an action to foreclose a mortgage
         THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
       BLY, DO ENACT AS FOLLOWS:
    1    Section 1. Subdivision 1 of section 1302 of the real property  actions
    2  and  proceedings  law, as amended by chapter 472 of the laws of 2008, is
    3  amended to read as follows:
    4    1. Any complaint served in a proceeding  initiated  pursuant  to  this
    5  article  relating  to  a high-cost home loan or a subprime home loan, as
    6  such terms are defined in section six-l and six-m of  the  banking  law,
    7  respectively,  must  contain  an affirmative allegation that at the time
    8  the proceeding is commenced, the plaintiff[:
    9    (a) is the owner and holder of the subject mortgage and note,  or  has
   10  been  delegated the authority to institute a mortgage foreclosure action
   11  by the owner and holder of the subject mortgage and note; and
   12    (b)] has complied with all of the provisions of section  five  hundred
   13  ninety-five-a  of  the banking law and any rules and regulations promul-
   14  gated thereunder, section six-l or six-m of the banking law, and  SUBDI-
   15  VISION  TWO  OF  SECTION  THIRTEEN  HUNDRED  TWO-A  AND section thirteen
   16  hundred four of this article.
   17    S 2. The real property actions  and  proceedings  law  is  amended  by
   18  adding a new section 1302-a to read as follows:
   19    S  1302-A.  STANDING  TO  COMMENCE  AN ACTION. 1. NO PERSON SHALL HAVE
   20  STANDING TO COMMENCE AN ACTION PURSUANT TO THIS ARTICLE UNLESS IT IS THE
   21  OWNER AND HOLDER OF THE SUBJECT MORTGAGE AND NOTE, OR HAS BEEN DELEGATED
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD03116-07-1
       S. 697--A                           2
    1  THE AUTHORITY TO INSTITUTE A MORTGAGE FORECLOSURE ACTION  BY  THE  OWNER
    2  AND  HOLDER  OF  THE  SUBJECT  MORTGAGE  AND  NOTE.  NOTWITHSTANDING THE
    3  PROVISIONS OF SUBDIVISION (E) OF RULE THIRTY-TWO HUNDRED ELEVEN  OF  THE
    4  CIVIL  PRACTICE LAW AND RULES, ANY DEFENSE BASED ON THE PLAINTIFF'S LACK
    5  OF STANDING IN A FORECLOSURE PROCEEDING SHALL NOT BE WAIVED IF A DEFEND-
    6  ANT FAILS TO RAISE THE DEFENSE IN A RESPONSIVE  PLEADING  OR  PRE-ANSWER
    7  MOTION TO DISMISS.
    8    2.  EVERY SUMMONS AND COMPLAINT TO COMMENCE A FORECLOSURE ACTION SHALL
    9  INCLUDE AN AFFIRMATIVE ALLEGATION THAT AT THE  TIME  THE  PROCEEDING  IS
   10  COMMENCED, THE PLAINTIFF IS THE OWNER AND HOLDER OF THE SUBJECT MORTGAGE
   11  AND  NOTE,  OR  HAS BEEN DELEGATED THE AUTHORITY TO INSTITUTE A MORTGAGE
   12  FORECLOSURE ACTION BY THE OWNER AND HOLDER OF THE SUBJECT  MORTGAGE  AND
   13  NOTE.   IN ADDITION, THE PLAINTIFF SHALL PLEAD IN ITS COMPLAINT THAT THE
   14  ORIGINALS OF THE SUBJECT MORTGAGE AND NOTE ARE  IN  ITS  POSSESSION  AND
   15  CONTROL,  AND  THAT  SUCH PLAINTIFF IS OTHERWISE ENTITLED TO ENFORCE THE
   16  SUBJECT MORTGAGE AND NOTE PURSUANT TO LAW.
   17    3. THERE SHALL BE FILED WITH EVERY SUMMONS AND COMPLAINT TO COMMENCE A
   18  FORECLOSURE ACTION:
   19    (A) A COPY OF THE ORIGINAL SUBJECT MORTGAGE AND NOTE, AND PROOF OF THE
   20  OWNERSHIP THEREOF INCLUDING ALL ORIGINAL ENDORSEMENTS,  ASSIGNMENTS  AND
   21  TRANSFERS OF SUCH MORTGAGE AND NOTE; AND
   22    (B) IF APPLICABLE, PROOF OF DELEGATION OF AUTHORITY FROM THE OWNER AND
   23  HOLDER OF THE SUBJECT MORTGAGE AND NOTE TO INSTITUTE A MORTGAGE FORECLO-
   24  SURE ACTION ON BEHALF OF SUCH OWNER AND HOLDER.
   25    4. THE COURT SHALL MAKE AN AFFIRMATIVE FINDING OF STANDING WHICH SHALL
   26  BE INCLUDED IN THE JUDGMENT OF FORECLOSURE AND SALE.
   27    S  3.  This act shall take effect immediately, except that section one
   28  of this act and subdivisions 2 and 3 of section 1302-a of the real prop-
   29  erty actions and proceedings law, as added by section two of  this  act,
   30  shall take effect on the ninetieth day after it shall have become a law.