Lender Alert: New York Legislation Requires Lenders to Maintain Abandoned Homes Before Foreclosure

Lender Alert: New York Legislation Requires Lenders to Maintain Abandoned Homes Before Foreclosure | Michael L. Moskowitz

On June 23, 2016, New York Governor Andrew Cuomo signed into law legislation which amends section 1307 of the New York Real Property Actions and Proceedings Law (RPAPL). The new law becomes effective 90 days from June 23, 2016. Section 1307 addresses the duty of a mortgagee, or its loan servicing agent, to maintain real property secured by a delinquent mortgage. Lenders will be subject to civil penalties of up to $500 per day for failure to maintain abandoned property once they become aware the property has become vacant. The old law required lenders to take responsibility following a foreclosure judgment which left hundreds of “zombie properties” across the state.

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