In a case before United States District Court, Judge Nicholas Garaufis, who sits in the Eastern District (Federal Court of New York), sometime between executing a note and mortgage in 2005 and 2017 regarding a foreclosure Stern sold the mortgaged property. The property was subdivided among new owners. In 2016 the plaintiff did not serve Stern a notice under New York Real Property Action and Proceedings Law Section 1304 which was to provide homeowners notice they were at risk of losing their home in foreclosure.
Homeowner Moved Out of the Property
Stern was not served with the appropriate notice under Real Property Action and Proceedings Law Section 1304 because the bank’s lawyers thought he was not entitled to such notice because Stern no longer lived in the property.
Foreclosure Lawsuit Dismissed
US District Court Judge Nicholas Garaufis dismissed the foreclosure lawsuit for failure to serve Stern with the required pre-foreclosure notice under Real Property Action and Proceedings Law Section 1304. This section requires the pre-foreclosure notice to be sent to the borrower at the time of the acceleration of the motion. This is true even if the borrower later moves out of the property which secures the loan. The fact that Stern no longer occupied the property as is primary residence did not excuse the financial institution’s obligation to serve Stern with notice of the foreclosure lawsuit. Judge Garaufis ruled when a lender, assignee or mortgage servicer fails to show strict compliance with the Real Property Action and Proceedings Law Section 1304, the foreclosure lawsuit must be dismissed.
Elliot S. Schlissel, Esq. is the managing partner of Schlissel DeCorpo LLP. The firm has been representing homeowners throughout the Metropolitan New York area regarding foreclosure matters for more than 45 years. He can be reached at 800-344-6431 or e-mailed at Elliot@sdnylaw.com.
