## Foreclosure defense in New York When you fall behind on your mortgage, the lender can ultimately take the home through **foreclosure**. New York uses Judicial foreclosure with a typical timeline of 360-1100+ days (slowest) from default to sale. ## Two main foreclosure systems **Judicial foreclosure** — court-supervised: - Lender files lawsuit - Borrower has chance to answer / contest - Court issues judgment of foreclosure - Sale by sheriff or court-appointed trustee - Slower but more borrower protections **Non-judicial foreclosure** — power-of-sale: - No court involvement (initially) - Lender follows statutory notice procedures - Trustee sale at auction - Faster but fewer borrower protections - Borrower can still file lawsuit to delay / challenge ## Stages of foreclosure **1. Default.** Missing 1-2 mortgage payments. No legal action yet. **2. Notice of default / pre-foreclosure.** Lender sends notice (often 30-day letter). Borrower can still cure by paying past-due amount + fees. **3. Notice of sale / lis pendens.** In judicial states, lawsuit filed and lis pendens recorded. In non-judicial states, notice of sale recorded and published. **4. Foreclosure sale.** Auction or court-ordered sale. **5. Eviction.** If borrower doesn't leave voluntarily after sale, eviction follows. **6. Redemption period (some states only).** Borrower can buy back property within X days at sale price + costs. Common in midwestern states; rare in non-judicial states. ## Common defenses **1. Failure to follow procedural requirements.** Foreclosure statutes require precise notice, recording, and publication. Even small mistakes can void the foreclosure: - Wrong notice form / wrong recipient - Insufficient notice period - Missing publication - Wrong party initiating (assignment problems) - Defective acceleration notice **2. Standing / robo-signing.** Lender must prove it owns the loan and has authority to foreclose. After 2008-2010 mortgage crisis, many lenders' chains of assignment were defective. Forged / robo-signed assignments can defeat foreclosures. **3. Predatory lending / TILA / RESPA violations.** Original loan violated: - Truth in Lending Act (TILA) - Real Estate Settlement Procedures Act (RESPA) - Home Ownership and Equity Protection Act (HOEPA) - State unfair / deceptive practices laws **4. Servicing errors.** Servicer mishandled payments, applied funds incorrectly, charged improper fees, failed to provide required mortgage assistance options. **5. Dual tracking violations.** CFPB rules prohibit servicer from foreclosing while loss-mitigation application is pending. **6. Failure to comply with HUD-required pre-foreclosure (FHA loans).** HUD requires face-to-face meetings and specific procedures for FHA-insured loans. **7. SCRA violations.** Service members on active duty have foreclosure protections. **8. Bankruptcy stay.** Filing Chapter 13 (or sometimes Chapter 7) imposes automatic stay halting foreclosure. Chapter 13 also lets you cure arrears over 3-5 years. ## Loss mitigation alternatives - **Loan modification** — change loan terms to lower payment - **Forbearance** — temporary reduction / suspension - **Repayment plan** — catch up arrears over time - **Short sale** — sell for less than mortgage; lender accepts to avoid foreclosure - **Deed in lieu of foreclosure** — give the property to lender to settle the debt - **Refinance** (if equity / credit allows) - **Reverse mortgage** (for seniors with equity) ## CFPB rules — protections during loss mitigation Federal Consumer Financial Protection Bureau (CFPB) Regulation X: - Servicer can't initiate foreclosure until 120 days delinquent - Must respond to loss-mitigation applications within 5 days - Must complete review within 30 days of complete application - Can't foreclose while complete application is pending - Must offer borrower right to appeal denial - Single point of contact required at servicer These rules give borrowers important leverage. ## Bankruptcy as defense Filing bankruptcy stops foreclosure immediately: **Chapter 13 advantages:** - Cure mortgage arrears over 3-5 years - Keep the home if plan succeeds - Strip second mortgages if first mortgage exceeds home value (lien stripping) **Chapter 7 advantages:** - Discharge other debt freeing money for mortgage - Delay foreclosure by 3-4 months - Wipe out deficiency liability Bankruptcy isn't free — but for many borrowers it's the right tool. ## Deficiency judgments After foreclosure, if sale doesn't cover full debt, lender may pursue **deficiency judgment** for the difference. State law varies: - **Anti-deficiency states** (CA purchase-money loans, AZ, NC for residential): no deficiency allowed - **Limited deficiency**: capped at fair market value vs sale price difference - **Full deficiency states**: lender can pursue full deficiency ## What you should do If you're facing foreclosure in New York: ACT IMMEDIATELY. Most successful defenses depend on early engagement. Free HUD-approved housing counseling is available; many states have legal-aid foreclosure programs. For more complex cases, hire a foreclosure-defense attorney — most New York attorneys offer flat-fee or contingency arrangements. Don't wait until the day of sale. --- *This guide is general information about New York law as of early 2026 and is not legal advice. Foreclosure procedures vary significantly by state. Talk to a licensed New York foreclosure-defense attorney about your specific case.*