On December 28, 2020, New York Governor Andrew Cuomo signed into law the COVID-19 Emergency Eviction and Foreclosure Prevention Act of 2020 (the “Act”), which, among other things, implements certain requirements and restrictions on residential foreclosures in New York. The Act does not apply to certain commercial foreclosures or to vacant and abandoned properties that were listed on the statewide vacant and abandoned property electronic registry before March 7, 2020, and remain on the registry.
The Act applies in “any action to foreclose a mortgage relating to residential real property, provided the owner or mortgagor of such property is a natural person, regardless of how title is held, and owns ten or fewer dwelling units whether directly or indirectly.” The units may be in more than one building, but must include the primary residence of the mortgagor/owner and the remaining units must be currently occupied by a tenant or available for rent.
The Act immediately stayed all pending residential foreclosure actions for a period of sixty days (through February 27, 2021), and allows for the submission of a hardship declaration by a mortgagor/owner attesting to hardship due to the Covid-19 pandemic. If a mortgagor/owner submits a hardship declaration, any pending foreclosure proceeding or the initiation of a new foreclosure proceeding, will be stayed until May 1, 2021.
The Act contains the form of the hardship declaration that is to be used and requires that the Office of Court Administration translate the hardship declaration into Spanish and the six most common languages in the city of New York, after Spanish. The Act directs the courts to mail copies of the hardship declaration to mortgagors in all pending residential foreclosure matters. The Act also directs that a hardship declaration form be sent by the mortgagee with every notice sent pursuant to New York Real Property Actions and Proceedings Law Sections 1303 (Help for Homeowners in Foreclosure) and 1304 (90-Day Pre-Foreclosure Notice) in the mortgagor/owner’s primary language.
When a new residential foreclosure proceeding is initiated, the court will require both an affidavit of service of a hardship declaration and an affidavit from the foreclosing party or agent of the foreclosing party stating that no hardship declaration has been received from the mortgagor/owner. Further, the Act requires that upon the commencement of a new action, the court must seek confirmation, on the record or in writing, that the mortgagor/owner has received the blank hardship declaration and has not submitted a completed hardship declaration.
On December 31, 2020, New York State Chief Administrative Judge Lawrence Marks issued a memorandum regarding the requirements of the Act and the implementation of the Act by the courts.
The Unified Court System has published the hardship declaration in English, Spanish, Arabic, Bengali, Chinese (simplified and traditional), Haitian-Creole, Polish and Russian on its website. The website also states that the Unified Court System is in the process of updating various web pages to reflect the requirements of the Act.