Requires a stay of certain foreclosure proceedings where the mortgagor has applied for coverage under the New York state homeowner assistance fund or any local program administering federal emergency mortgage assistance program funds; allows such foreclosure proceedings to proceed against a mortgagor who has caused significant damage to the property.
Summary
A04455 would require a temporary stay of certain mortgage foreclosure proceedings when a homeowner has applied for assistance through the New York State Homeowner Assistance Fund or a local program using federal emergency mortgage assistance funds. If the homeowner’s application is pending, foreclosure could not be commenced, or if already pending, the case would be stayed until the program determines whether the homeowner is eligible for aid. The bill also provides that proof of a payment made through one of these assistance programs can create a presumption that the covered mortgage arrears for that period have been satisfied.
The bill creates a narrow exception for cases involving intentional, significant damage to the mortgaged property. In those cases, the lender may proceed, but only after making specific allegations under oath and, if the case is already pending, filing a new petition and complying with the notice and service requirements of Article 13 of the Real Property Actions and Proceedings Law. Mere allegations are not enough; the petitioner must actually establish the intentional damage before the foreclosure can move forward.
Impact
The bill would add a new procedural protection in New York foreclosure law by delaying lender actions against borrowers who are seeking mortgage arrears assistance from state or local emergency programs. It would affect foreclosure practice under the Real Property Actions and Proceedings Law by requiring courts to stay cases during eligibility review and by creating a rebuttable presumption of satisfaction for arrears covered by assistance payments. It also imposes additional pleading and proof requirements on petitioners who claim the borrower intentionally damaged the property, while preserving the ability to continue foreclosure in proven damage cases.
Sentiment
Based on the bill text and caption, the measure appears aimed at protecting homeowners from losing their homes while assistance applications are pending, suggesting a generally borrower-protective and foreclosure-mitigation policy approach. No committee transcript or vote record is provided, so there is no direct evidence of debate, amendments, or recorded support/opposition. The overall framing of the bill indicates an emphasis on preserving housing stability while still allowing foreclosure to proceed in cases of serious property damage.
Contention
The main point of contention is likely the balance between homeowner protections and lender rights. Supporters would favor the stay as a way to prevent foreclosure while emergency aid is being processed, especially where arrears may be covered by public funds. Opponents, likely mortgage lenders and servicers, may argue that the bill delays enforcement and adds procedural burdens, particularly the requirement to halt or restart proceedings and prove intentional property damage before proceeding. The exception for intentional significant damage appears designed to address concerns about abuse or bad-faith conduct by borrowers.
Requires a stay of certain foreclosure proceedings where the mortgagor has applied for coverage under the New York state homeowner assistance fund or any local program administering federal emergency mortgage assistance program funds; allows such foreclosure proceedings to proceed against a mortgagor who has caused significant damage to the property.
An act to amend Sections 2924d, 2924h, and 2924m of the Civil Code, and to amend Sections 50612 and 50720.2 of the Health and Safety Code, relating to mortgages.