Bill Text: NY S08445 | 2019-2020 | General Assembly | Amended

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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 - Dead) 2020-06-26 - PRINT NUMBER 8445B [S08445 Detail]

Download: New_York-2019-S08445-Amended.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                         8445--B

                    IN SENATE

                                      June 3, 2020
                                       ___________

        Introduced  by  Sen. SANDERS -- 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  committee  --  committee
          discharged, bill amended, 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

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD16379-04-0
        S. 8445--B                          2

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