Many families here in Long Island and around the country get behind in their mortgage payments. The anxiety and pain that this causes is real, because losing a home is about much more than a financial loss. The loss of the memories and security of a family home is devastating.
The state of New York has many protections in place for homeowners who are struggling, however. We were recently able to secure a judgement in favor of a client of ours who was facing foreclosure that not only allowed her to keep her home, the mortgage itself was eliminated. If you are facing foreclosure, there may be similar ways that you can be helped, too.
When someone is behind in their monthly mortgage, a series of procedures required under New York law begin. New York is a judicial foreclosure state, meaning that the process of foreclosure has to take place in the courts.
This action is subject to a lot of restrictions. One of them is that there is a statute of limitations which requires it to take place within six years of a “triggering event.” The law is very specific about the procedures and what constitutes such an event.
If you miss a payment on your mortgage, that is a triggering event. The next month that you miss a payment is another, and the clock starts over on the statute of limitations. Before foreclosure, a mortgage company will usually demand that the mortgage be paid in full, a condition known as an “accelerated payment.” From that date forward, the only payment due is for the mortgage in full.
Once there is a request for an accelerated payment of the full mortgage, the clock is running on the statute of limitations.
Our recent victory
Our client had been in default on her mortgage for some time. An intent to foreclose and demand for an accelerated payment was issued on August 19, 2008. Her mortgage was sold a number of times even after that date, and no action was taken by some of the mortgage holders. One did file with the court for foreclosure in 2012, but then sold the mortgage and lost the right to pursue foreclosure.
The mortgage was last purchased by a real estate group in January 2014. They failed to pursue the foreclosure by August of that year, and the statute of limitations expired.
We successfully argued for our client that the last triggering event was when our client was given an accelerated payment in 2008, regardless of who subsequently purchased the mortgage. There were no other triggering events as far as our client was concerned.
Our client prevailed in court. Her mortgage was cancelled, meaning that she owns her house free and clear.
What this means for you
New York has many protections for property owners. If the mortgage holders are not following the absolute letter of the law they cannot foreclose and take your property. It doesn’t matter if your mortgage is sold to another bank or investment group, there are time limits and procedures for everything.
If you or a loved one are at risk for losing your home, it’s important to speak to an attorney with experience in foreclosure defense. There are many ways that you may be able to keep your home and not have to deal with the trauma of foreclosure.