New York Foreclosure Laws

Learn about the foreclosure laws in New York. Research the foreclosure process in New York to understand how it works and the various stages of default. How long does foreclosure take in New York? What are the foreclosure consequences in New York? Is New York a judicial or non-judicial foreclosure law state? Find out the answers to these questions and many more with the foreclosure information and foreclosure laws in New York below.


Questions
How are mortgage liens treated in New York?
How are New York mortgages foreclosed?
What are the legal instruments that establish a New York mortgage?
How long does it take to foreclose a property in New York?
Is there a right of redemption in New York?
Are deficiency judgments permitted in New York?
What statutes govern New York foreclosures?

Answers

How are mortgage liens treated in New York?

New York is known as alien theory state where the property acts as security for the underlying loan. The document that places the lien on the property is called amortgage. It should be noted that New York does have anon-judicial foreclosure process however this is rarely used by lenders.

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How are New York mortgages foreclosed?

In New York, thelenders go to court in what is known as ajudicial foreclosure proceeding where the court must issue a final judgment of foreclosure. The property is then sold as part of a publicly noticed sale. The court with jurisdiction over a foreclosure is known as theSupreme Court in the county in which the property is located. A foreclosure complaint involving a property in Manhattan would be filed in the Supreme Court of New York: New York County. A complaint is filed in this court along with what is known alis pendens. A lis pendens is a recorded document that provides public notice that the property is being foreclosed upon.

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What are the legal instruments that establish an New York mortgage?

The documents are known as themortgage,note, and in a commercial transaction, asecurity agreement. Sometimes the mortgage document is combined with the security agreement.  Amortgage is filed to evidence the underlying debt and terms of repayment, which is set forth in thenote.

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How long does it take to foreclose a property in New York?

Depending on the court schedule, it usually takes approximately 120-180 days to effectuate an uncontested foreclosure. This process may be delayed if the borrower contests the action, seeks delays and adjournments of hearings, or files forbankruptcy. A foreclosure sale must be advertised at least four (4) weeks in advance of any sale and sales usually take four (4) months after final judgment for foreclosure is granted.

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Is there a right of redemption in New York?

New York has nostatutory right of redemption, which would allow a party whose property has been foreclosed to reclaim that property by making payment in full of the sum of the unpaid loan plus costs.

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Are deficiency judgments permitted in New York?

Yes. Adeficiency judgment may be obtained when a property in foreclosure is sold at a public sale for less than the loan amount which the underlying mortgage secures. This means that the borrower still owes thelender for the difference between what the property sold for at auction and the amount of the original loan. The Plaintiff must file a motion within 90 days after the property sale auction to enforce this right.

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What statutes govern New York foreclosures?

The laws that govern New York foreclosures are found in New York State Consolidated Laws, Article 13.

http://assembly.state.ny.us/leg/?cl=100&a=15

The New Yorknon-judicial foreclosure law is found in New York State Consolidated Laws, Article 14.

http://assembly.state.ny.us/leg/?cl=100&a=16


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