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Providing Foreclosure, Bankruptcy and related Legal Services in New York State for the Mortgage Banking Industry

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New York is a "Judicial" State and foreclosure actions in the courts require a number of steps. The usual steps in a New York foreclosure are listed below. For more information and an estimate of the usual time required for each step, you can scroll down the page or click on any step.                 

1.  Receipt of File; Order the foreclosure search

2.  Prepare and file the Summons & Complaint

3.  Service of Summons & Complaint

4.  Defendants' statutory time to answer

        a. No Answer: Prepare Order of Reference

        b. Answer received: Prepare Motion for Summary Judgment

5.  Prepare Client's Affidavit of Sums Due

6.  Referee's Oath and Report

7.  Judgment of Foreclosure

8.  Schedule Foreclosure Sale

9.  Foreclosure Sale                                   

10. Referee's Report of Sale

Other Matters of Importance

Eviction

Publication of Summons

Actions on Notice to one or more Defendants

Factors which delay the Foreclosure Process

Explanation of Steps in a Foreclosure

1. RECEIPT OF FILE: ORDERING SEARCH

TIME: The search will be received within a week to 10 days of our receipt of the file.

Upon receipt of a Referral Package from a client to commence a foreclosure, we order a title search that day. The search discloses the current owners, any liens and judgments against the property and the names of other parties who must be made defendants in the foreclosure.

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2. PREPARATION & FILING OF THE SUMMONS & COMPLAINT

TIME: 2- 3 Weeks.

A Summons & Complaint and Notice of Pendency are prepared after receipt of the search and filed with the clerk of the court for the county where the property is located. Each county has its own clerk and recording fee requirements and time vary from county to county.

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3. SERVICE OF SUMMONS & COMPLAINT ON DEFENDANTS

TIME: Approximately 1 month to complete service on all Defendants.

After the Summons & Complaint are filed with the county clerk it is sent out for service on all Defendants named in the action.

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4. DEFENDANTS' TIME TO ANSWER:

TIME: Defendants have between 20 to 60 days either to appear or answer the complaint depending on the method of service. The action cannot proceed until the Defendants time to answer has expired.

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5. NO ANSWER RECEIVED: PREPARATION OF THE ORDER OF REFERENCE

TIME: Two weeks to prepare the Order of Reference and submit it to the court. One to three months for the court to sign the Order of Reference and then have it entered in the county clerk's office. There are extensive court backlogs in the five counties of New York City: Kings, Queens, Bronx, Richmond and New York and there are also delays to a lesser extent in Nassau and Suffolk Counties. If a Defendant appeared in the action and required notice of the proceedings, the Order of Reference must be served on the Defendant and the motion is assigned a return date to allow the defendant to appear in court and oppose the motion. This can delay the Order of Reference at least an additional month.

Once the Defendants time to answer has expired, if no answer has been received, we prepare and submit an Order asking the Court to appoint a Referee who will determine the monies due and owing to the Plaintiff.

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6. ANSWER RECEIVED & CONTESTING ACTION: PREPARATION OF MOTION FOR SUMMARY JUDGMENT

TIME: One month to prepare the Motion. Two to four months to have the Court grant the motion.

Upon receipt of an answer, a letter is sent to the servicer notifying them that the action is contested and that an approval is need for additional legal fees. At the same time a letter is sent to the Defendant's attorney requesting that they withdraw the answer. Once the fees have been authorized and the answer has not been withdrawn, we make a Motion for Summary Judgment to strike Defendants answer and appoint a Referee.

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7. PREPARATION OF THE CLIENT AFFIDAVIT OF SUMS DUE

TIME: Clients typically take four to six weeks to return the signed and notarized Affidavit.

Once the Order of Reference is granted and entered by the court, we will prepare the Referee's Oath and Report which includes an Affidavit from the Servicer. We prepare the affidavit and request the servicer to compute the amount due including principal, interest, tax advances, expenses incurred to preserve of the property.

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8. REFEREE'S OATH AND REPORT

TIME: Approximately 3 to 4 weeks for the Referee to review and sign the report.

Once the Client's affidavit is received we then submit the Oath to the Referee for signature. The Referee reviews the Affidavit, computes the amount due and owing to the Plaintiff and certifies that the property may be sold in one parcel.

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9. PREPARATION OF JUDGMENT OF FORECLOSURE

TIME: Two weeks to prepare the Judgment. One to three months for Judgment to be signed and entered by the court. If the Defendant has appeared and demanded notice an additional month will be necessary.

Upon the return of the executed Referee's Oath and Report it is filed with the court. Simultaneously with the filing of the Referee's Report, an application is made to the court for the entry of a Judgment of Foreclosure and Sale. The Judgment sets forth the amount due and owing on the loan and specifies where the sale is to take place and the newspaper in which the Notice of Sale is to be advertised.

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10. SCHEDULING OF AUCTION SALE

TIME: One to two months once the entered judgment is received to the sale date. The amount of time depends on the Referee's availability.

Once the Judgment has been signed by the court and entered (in New York City there is a delay of from one to three weeks between the Judgement signing and entry of the Judgment) arrangements are made for a sale date with the Referee. The sale, except where the property is located in a city (New York City, Long Beach, Yonkers) must take place between the 28th day and the 35th day after the first publication. The Notice of Sale must be published once a week for four consecutive weeks and also posted in three public places. When the property is located outside a city the Notice is published in a newspaper twice a week for three consecutive weeks and the sale must take place between the 21st and 28th day after the date of first publication. A copy of the Notice of Sale is sent to all Defendants who requested it or are entitled by law to notice. Notice of Sale is also sent to the servicer and we request an updated computation of the sums due and owing to prepare the bidding instructions used by the Referee to conduct the sale.

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11. FORECLOSURE SALE

On the date of the sale, if there are no persons interested in the property, counsel will "bid-in" the property for the plaintiff at an amount specified by the servicer.

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12. REFEREE'S REPORT OF SALE

After the sale, a Referee's Report is prepared and filed with the Court and the deed is sent for recording.

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EVICTION

Where an eviction is required, the following steps are taken:

A. The Deed is first exhibited by a process servicer to all occupants of the premises and a demand is made that they vacate.

B. Thereafter, if the occupants fail to leave, and Order is obtained requiring them to appear in Court to explain why an Order should not be made to the Sheriff to forcibly remove them from the premises.

C. The Court will usually grant the relief requested but stay the actual eviction so as to afford the occupants a reasonable time to move out.

D. If, after the stay, the occupants have failed to vacate, a document called a Writ of Assistance is delivered to the Sheriff directing that he put the plaintiff in possession of the premises. The Sheriff will require an advance deposit for moving costs in addition to the regular fee which varies from county to county. Our office will request these fees from the servicer at the time the Writ of Assistance is delivered to the Sheriff.

E. The Sheriff, upon receipt of the Writ of Assistance, will usually attempt to have the occupants vacate without the necessity of a formal eviction. If this fails, after giving 72 hours notice, he will forcibly evict the occupants. The method of eviction varies from county to county. In the City of New York the Sheriff will actually put the possessions of the occupants on a moving van and deliver them to a special warehouse, maintained by the Department of Sanitation. In the counties of Suffolk and Nassau, the Sheriff will retain the services of a moving company and merely place the possessions of the occupant on the street.

TIME: Three to Five months depending on the location of the property.

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PUBLICATION OF THE SUMMONS

Where a defendant cannot be served it may become necessary to publish the Summons against him in two local newspapers. The following procedure must be followed in order to obtain an Order of Publication:

1. The proposed Order of Publication is submitted to the Court along with a supporting affidavit showing all steps taken to locate the defendant and verify that his whereabouts are unknown. Usually a process server makes up a detailed affidavit setting forth his efforts to locate the defendant.

2. At the time the Order is obtained the Court will also appoint a Guardian ad Litem and Military Attorney to act on behalf of the defendant and the unknown persons who will be served by publication, so as to protect their interests in the proceedings and comply with the Soldiers and Sailors Relief Act.

3. In addition to causing the Summons to be published in two newspapers, counsel will prepare for the Guardian, an Answer to the foreclosure, a Consent and his oath of office. These papers are sent to the Guardian for signature along with the various procedural documents used in the foreclosure such as the Summons, Complaint, Notice of Pendency and Order of Publication.

4. Upon the return of the Answer, Consent and Oath, they are filed with the Court along with the Order of Reference, endorsed with the Guardian's Consent.

5. It should be noted that where there is a Guardian, he has a right to be present at the hearing held by the Referee to Compute. Usually the Guardian will waive his attendance. Please note that in the County of Kings, the Court requires that there be an actual hearing and that the Referee take proof of the various facts and circumstances as set forth in the Complaint.

6. Once the Judgment is prepared the Guardian must endorse his consent to its entry prior to its submission to the Court.

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ACTIONS ON NOTICE TO ONE OR MORE DEFENDANTS:

In a number of instances, an attorney will appear in the action for his client. Instead of interposing an Answer he will merely demand that all papers in the action be served upon his office. In this instance, each step of the proceeding must be on notice to the attorney and for example before the Order of Reference can be obtained Notice of the application to the Court must be given him with appropriate time to respond. Usually this application would be made returnable thirteen days after the mailing. The same holds true for the Referee's computation. Notice of the same must be given to the attorney.

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FACTORS WHICH DELAY THE FORECLOSURE PROCESS

bulletTitle problems;
bulletProblems locating and serving defendants;
bulletAnswers by Defendants contesting the actions;
bulletDefendants appearing in action and requiring notice of all motions;
bulletMissing assignments of mortgage;
bulletBankruptcy filings;
bulletCourt backlog (Downstate - 5 Counties of NYC, Nassau, Suffolk);
bulletReceiving Affidavits of Sums Due for Referee's Oath from clients;
bulletReferee Delays in returning Oath and setting a sale date;
 

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