Yves came to a conflicting judge to make this ruling in favor of the bank/mortgage service provider, which brings bad memories of the era of foreclosure/equity chain crisis. Although this decision only applies to New York borrowers, it reminds people of how the judicial process favors the interests of large institutions. We have seen this behavior in many other situations, such as how California judges generally respect CalPERS inappropriately, and Kentucky’s allegedly most progressive judge Philip Shepherd is now clearly trying to protect The State’s Attorney General’s Intervention in Kentucky’s Retirement Although his file contains basic and almost certainly incurable defendant-prone errors, a systematic case.

The problem here is that the loan program was rejected for failing to take action on a specific date. The requirement has now been abandoned, as if it were just a technical issue. Real-world court cases have been dismissed because of other “techniques,” such as relying on evidence at home without obtaining a search warrant.

The number of houses affected in New York is large because many foreclosures were suspended after the court introduced a request. The effect of this request is to make it easier for the defense in the Signed documents) in the case of sanctions, where they cannot prove its validity.

By Sam Mellins.Joint publishing city with New York Focus, An independent investigative news website covering New York State and urban politics

Christine Fife recalled that when she won the foreclosure case in January 2020, she was “overwhelmed with joy” and she believed that the ten years she faced threats of foreclosure in the Upper West Side apartment were finally over.

Now, however, Fife is once again facing the confiscation of the apartment she has owned since 1990.

In February 2021, the New York Supreme Court issued a Decide This eliminates the path that New York homeowners have used for years to fight foreclosures.

The decision in Freedom Mortgage Corporation v. Engel allowed Fife’s lenders to update the foreclosure suit against her.

“They said it was okay. How could they change their minds?” Fife asked in an interview with New York Focus and THE CITY.

Throughout New York State, as a result of Engel’s decision, homeowners who believe their case has been resolved are now facing foreclosure again. Many people are in danger of losing their homes, even though two bills designed to protect property owners passed the state legislature.

Case reopened

In New York, if the borrower misses the mortgage payment, the lender will Allow request for full balance Immediately, and then foreclosure after 120 days, if the arrears are still unpaid.

However, the lender must initiate legal proceedings within six years after the first request for full payment, otherwise the litigation is invalid.

Until recently, the clock was ticking until the lender notified the borrower that they would no longer seek foreclosure. In Fife’s case, the lender never did this. The bank sued Fife twice: the first time in 2010, the lender claimed that it later withdrew voluntarily, and the second time in 2017.

Her attorney represented Fife without compensation and successfully argued that the bank’s second foreclosure lawsuit was barred due to the six-year limit and was rejected.

But Engel’s decision changed the rules. The Court of Appeal found that the voluntary end of the foreclosure lawsuit would stop the six-year time limit, even if the homeowner was never notified. The court’s decision is retrospective and applies to any foreclosure case that is in progress or can still be appealed at the time of the decision.

After the ruling, many foreclosures that expired within 6 years have been reopened or appealed to a higher court. Holly Meyer, a Suffolk county lawyer who represented one of the defendants in Engel’s case, estimated that the number of homeowners affected could reach tens of thousands.

Fife is one of them. In April 2021, the bank decided to renew the foreclosure suit against her-the trial judge cited Engel’s ruling as a reason for retrial of the case.

“I was shocked by this decision because I fully believe [the foreclosure court’s] The initial decision was in my favor,” Fife said.

Her legal counsel admits that as Fife’s best defense disappears, her hopes of avoiding foreclosure now appear slim.

“Incompetent” managed loans

According to real estate lawyers, it is not uncommon for lenders to allow their foreclosures to expire.

Joshua Stein, a commercial real estate lawyer, said: “There are millions of residential loans that are somewhat underpaid, so these things do sometimes slip through the cracks.”

Supporters of the real estate industry who ruled by the Court of Appeal said that the failure of the foreclosure case because they believed it was a clerical error had little meaning—it basically allowed the borrower to evade the debt.

“You should still be at risk, because the idea that you didn’t repay the money you borrowed didn’t shock me,” Stein said.

The homeowner’s lawyer said that due to technical violations of procedural requirements, the case has been withdrawn in the legal system, and foreclosure cases are no exception.

“If someone is tried for murder but you find that their constitutional rights have been violated, they will be free. It’s the same here,” Meyer said.

The chief judge has a conflict?

On the day after the Appeals Court ruled on the Engel case, the law firm of Greenberg Trigger, representing the two plaintiffs, cheered the lender’s so-called “subversive” victory.

“The statewide application may protect the billions of assets of mortgage holders,” its press release said.

Chief Judge Janet DiFiore wrote the majority opinion in the Engel case, when she was a client of Greenberg Traurig, and at the time she made favorable decisions in this and other cases. Ruling for bank customers, New York Law Journal April reportThe company defended her in a lawsuit in which the judge was forced to retire to cut costs.

Defense counsel Said They were not told that the judge who ruled on their client might conflict.

“The law is no longer on our side, which means that many people will face foreclosure situations that they would not have faced a few years ago,” said Julie Howe, a senior lawyer in New York. Fife’s legal aid team told New York Focus.

On February 8, 2016, then Governor Andrew Cuomo was sworn in as the new Chief Judge of the New York State Court of Appeals at Janet DiFiore.Governor Andrew Cuomo’s Office
Jacob Inwald, director of foreclosure prevention at New York Legal Services, said that many of the foreclosure cases affected by Engel’s decision originally originated from the 2008 real estate crash and arbitrary loans that led to this problem.

For example, Fife borrowed $731,000 from her apartment in April 2007 to cover living expenses due to disability and divorce. With monthly repayments of nearly $5,000, the annual interest rate for adjustable-rate mortgages is 8%, which may be as high as 15%.

“I don’t know anything about mortgages,” Fife said. “I’m glad I can live another day. I may be the most acceptable person in this neighborhood.”

Within a year, the bank claimed that she defaulted on the mortgage-initiated the foreclosure process, and her loan holder Wilmington Trust was resurrected more than a decade later.

‘It’s really scary’

Susan Azcuy, a Rockland County resident, was in a situation similar to Fife—she thought she had survived the foreclosure, only to find dark clouds over her head again.

For 23 years, Azcuy and her husband have been paying the mortgage for their house in Pomona, including the refinancing in 2005, for which she assumed $210,000 in debt at an interest rate of 5.75%. But in 2012, after Azcuy’s husband was fired, they missed the payment, and their lender quickly took foreclosure measures.

The bank voluntarily withdrew the lawsuit for technical reasons in March 2016, but did not notify Azcuy and filed a new lawsuit next month. It opened in 2019, and Azcuy won after a key prosecution witness failed to appear in court.

‘We are still struggling. I very much hope that I can continue to live here.
Before Engel, this was the end of the case, because more than six years have passed since the 2012 foreclosure proceedings.

But thanks to Engel, the six-year clock was restarted in 2016-giving Azcuy’s lenders another opportunity to sue.

Due to penalties and Foreclosure fee, Azcuy now owes nearly US$400,000, which is almost twice the amount of refinancing in 2005. According to Azcuy’s lawyer, Derek Tarson of the Rockland County Legal Aid Association, efforts to reach a settlement or amendment with the bank have been unsuccessful.

If the bank files another foreclosure suit (which Tarson believes is very likely), Azcuy will not be able to rely on the defense that has been over six years.

“It’s really scary. We are still struggling,” Azcuy said. “I very much hope that I can continue to live here.”

Lawmakers respond

State legislators introduced two bills aimed at reversing Engel’s influence.

A measure initiated by Senator Kevin Thomas (D-Nassau) and Senator Helen Weinstein (D-Brooklyn) will require lenders to notify borrowers when they withdraw their payment requirements because the action helps Stop the clock at six o’clock to count down the year. If the lender withdraws the lawsuit but fails to notify the borrower, time will always pass-back to where it was before Engel.

The bill will also prohibit lenders from foreclosures if any part of the loan has expired-a measure that would prohibit litigation against homeowners such as Fife and Azcuy.

The legislature is also considering a second bill initiated by Senator James Sanders (D-Queens) and Senator Ratrys Walker (D-Brooklyn).

The bill will prevent lenders from requesting full payment without the borrower’s consent, and stop the six-year countdown. The measure will also count down from the time when mortgage holders missed payments.

A foreclosure defense lawyer told New York Focus that although designed to protect homeowners, the Sanders-Walker Act can actually motivate lenders to start foreclosures more quickly. “If time is tight, all the plaintiffs want to do is start their case,” said the lawyer, who asked not to be named.

Sanders rejected this criticism. “I don’t think you can further incentivize financial institutions” foreclosure after Engel gives them leeway, he said.

Whether these two bills will apply retrospectively to homeowners such as Fife and Azcuy is an open question. “It may not help those, but this is our wish,” Sanders said. “We will get guidance on whether we can do this.”

Sanders said he had talked with Governor Kathy Hochul and legislative leaders about his bill, and although they have not yet approved the bill, he said they are willing to support it. (A Hochul spokesperson said that the governor “will review all legislation on her desk.”

Sanders said: “We have made good progress in both areas, and we look forward to good things happening in the next few days.”