New York Foreclosure Law Summary
Stop New York Foreclosure
- Judicial Foreclosure Available: Yes
- Non-Judicial Foreclosure Available: Yes
- Primary Security Instruments: Deed of Trust, Mortgage
- Timeline: Typically 120 days
- Right of Redemption: No
- Deficiency Judgments Allowed: Yes
In New York , lenders may foreclose on deeds of trusts or mortgages
in default using either a judicial or non-judicial foreclosure process.
The judicial foreclosure process is one in which the lender must
file a complaint against the borrower and obtain a decree of sale from a court having
jurisdiction in the county where the property is located before foreclosure proceedings
can begin. Generally, if the court finds the borrower in default, they will give
them a set period of time to pay the delinquent amount, plus costs. If the borrower
does not pay within the set period of time, the court will then order the property
to be sold by the sheriff of the county or a referee.
Typically the foreclosure sale is advertised for 4 to 6 weeks.
The sale is made by public auction to the highest bidder. Anyone may bid, including
After the property has been sold, the officer conducting the sale
must execute a deed to the purchaser. The officer must also pay, out of the proceeds,
the amount of the debt, including interest and costs, to the lender and then obtain
a receipt for the payment from the lender.
Within thirty days after the completing the sale and executing
the deed to the purchaser, the officer must file a report of sale, which must include
the receipt from the lender, with the clerk of the court. Unless otherwise ordered
by the court, the sale can't be confirmed until three months past the filing of
the report of sale.
The non-judicial process of foreclosure is used when a power of
sale clause exists in a mortgage or deed of trust. A "power of sale" clause is the
clause in a deed of trust or mortgage, in which the borrower pre-authorizes the
sale of property to pay off the balance on a loan in the event of the their default.
In deeds of trust or mortgages where a power of sale exists, the power given to
the lender to sell the property may be executed by the lender or their representative,
typically referred to as the trustee.
Although this type of foreclosure is permitted in New York, it
is rarely used by lenders.
on New York foreclosure laws.