The foreclosure process in New York is much more complicated than most homeowners understand it to be. It is a process that involves a number of steps to complete. The purpose of this article is to inform homeowners about the foreclosure process and the options homeowners have to stop foreclosures from moving forward.
Time Frames for Foreclosure
The foreclosure process in New York can be discussed with regard to two types of time frames. If the homeowner ignores the Summons and Complaint, takes no legal action and does not hire an attorney to defend them, the process can take approximately 18 months and depending on how aggressive the financial institution is, even longer. However, if the homeowner hires an attorney, files a formal Answer, contests the proceedings, engages in the discovery process and opposes a summary judgment motion, the foreclosure process can be extended to 3 years or more.
Missing Mortgage Payments
In the event you are unable to make your mortgage payments on a timely basis, the best means of dealing with the situation is to notify your financial institution. Many of the lenders in New York are willing to work out payment plans during financial hardship situations for homeowners. You can apply for a mortgage modification or a forbearance agreement. In the event you realize you will not be able to make your mortgage payments over the long run, it is necessary to hire a foreclosure attorney to represent you in the foreclosure proceeding that will be forthcoming.
Banks do not, in New York State, take action to initiate foreclosure proceedings until the homeowner is a minimum of 3 months behind in their mortgage payments. Some banks will wait as long as 6 to 9 months before they will consider taking legal action. If there are problems with the paperwork, issues involving assignments, robo-signers, violations of truth in lending or New York State laws, the banks may wait years before they initiate a foreclosure proceeding.
Pre-Foreclosure Notice
In New York State a lender must notify the homeowner in writing 90 days before beginning legal proceedings. This pre-foreclosure notice advises the homeowner the bank is accelerating the mortgage. This means the bank is calling the entire amount of the mortgage due and owing. Once the mortgage is accelerated, if the homeowner makes a mortgage payment, the banks will usually reject the payment and demand the entire mortgage be paid in a lump sum.
Foreclosure Legal Proceeding
The foreclosure process is started by the attorney for the financial institution drafting a summons and complaint, filing the summons and complaint, and hiring a process server to serve the summons and complaint on you. If the summons and complaint is served on you personally, you have 20 days to hire an attorney and submit a formal written answer. If it is served on you in any other manner other than through personal delivery, you have 30 days to respond by submitting a written Answer to the summons and complaint.
Mortgage Modification
Some homeowners have the mistaken idea that submitting a mortgage modification application acts as a response to the summons and complaint. This is not true. If served with a summons and complaint in a foreclosure, you need to submit a written answer admitting or denying the allegations in the complaint alleging affirmative defenses and possibly countersuing the bank.
End of Foreclosure Proceeding
A foreclosure proceeding ends by the sale of the home by a referee in an auction type sale. Don’t wait for this to happen. Hire a competent foreclosure defense lawyer to represent you if you want to stay in your home!
