Carl J. Nelson Law,  P.C.

Appellate court issues opinion regarding 90-day pre-foreclosure notice.

A New York appellate court in the second department (which includes Westchester as well as Brooklyn, Queens, Long Island and the counties of Rockland, Putnam, Orange and Dutchess) recently issued an important opinion regarding certain notices that foreclosing mortgage lenders are required to make before filing a foreclosure action.

Among other requirements, New York law requires that a foreclosing creditor (i.e. a mortgage bank or servicer) provide a borrower/defendant with a specific pre-foreclosure notice 90-days prior to commencing a foreclosure action.  The notice, mandated under New York’s Real Property Actions and Proceeding Law (RPAPL) section 1304 are conditions precedent to the filing of a foreclosure action.  This means that a foreclosure action must be dismissed if the mandates are not properly executed. 

In the case at hand, the foreclosing bank sent the 90-day notice and it was received by the homeowner.  However, the lender also included additional, supplementary material which was related to the substance of the notice.  The trial court dismissed the action for the mortgage lender’s failure to strictly adhere to the RPAPL 1304 pre-foreclosure notice.  The lender appealed to the appellate court.  The majority opinion of the appellate court discussed both its interpretation of the section 1304 language as well as the statutory history and public policy underlying the law.  Ultimately, the Court concluded that the plain language of the statute mandated that the required 90-day notice be in a “separate envelope,” which envelope could not include any other material other than the mandated language supplied by the statute. 

The Appellate Court upheld the dismissal of the case for the bank’s failure to comply with RPAPL 1304. 

RPAPL 1304 is a commonly litigated portion of many residential foreclosure actions in New York.  As with many areas of law, the case and statutory law can be complex and is often interpreted by case law such as this appellate court opinion.  This ruling provides clarification of foreclosure lenders’ obligations under RPAPL 1304 and is relevant to every foreclosure action being filed and certainly many pending cases. This is especially true in the second department, where the opinion is binding precedent. Homeowners facing foreclosure are strongly advised to seek qualified defense counsel to properly protect their legal rights and financial interests.   

Bank of Am., N.A. v Kessler, 2021 NY Slip Op 06979 (App. Div. 2nd Department, Decided December 15, 2021)

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