Attention New York Homeowners In Foreclosure: FAPA Is Facing Serious Legal Challenges From Deep Pocketed Wall Street Bankers.

It has been a little over six months since the Foreclosure Abuse Prevention Act (FAPA) went into effect. As predicted when it was signed into law, FAPA is now facing serious legal challenges from deep pocketed Wall Street banks. After all, Wall Street sees any law that benefits consumers as an existential threat to their viability.

New York homeowners facing foreclosure should also talk to their attorney about playing their FAPA card immediately. 

Homeowners should should not drag their feet. They should make saving their home their number one priority.  they should do it for two reasons:

1. The days of New York foreclosures dragging out in the courts for 5-6 years are pretty much over. Except for Queens and Brooklyn, foreclosure litigation in most New York counties is averaging less than a year. Yes, there are cases lingering from the 2008 financial crisis but judge are pushing to get those wrapped up and out the door immediately! So, get your eyes off that new BMW you want to buy because you will need the money.
2. FAPA may not be around long. New York courts have made contradictory rulings on it. So, will the New York Supreme Court shoot down FAPA? If so, when? Could it be challenged in federal court? These are questions with unknown answers. There is one silver lining to this. None of the four departments of New York’s Appellate Division have decided the issue. This indicates that it may be a while before the New York Supreme Court would hear the arguments for and against FAPA.

Why FAPA Is Facing Legal Challenges

Basically, the law would enforce the New York’s 6-year statute of limitations on foreclosure litigation.

The sticky part is the law is retroactive and applies to pending foreclosure litigation. This is part that has Wall Street banker up in arms. 

Key provisions of FAPA include:

• A lender’s voluntary discontinuance of a foreclosure will no longer re-set the six-year statute of limitations. Under the new law, a unilateral action by a lender does not extend the statute of limitations for a foreclosure action. Therefore, the law time-bars lenders from foreclosing on the mortgage after the 6-year statute of limitations. 
• The new law amends New York’s “election of remedies” law. The law bars lenders from attempting to recover the debt after the statute of limitations.
• The law also prohibits lenders from telling homeowners that the statute of limitations did not expire. The legislature was forced to add this provision during debate on the bill. Why? Foreclosure mills like to abuse the courts by making creative arguments of why the statute of limitations doesn’t apply. They will make crazy claims like their client did not validly accelerate the loan. Under the new law, the lender would not be permitted to assert that acceleration was invalid.
• The new law applies retroactively to any active and pending foreclosure action filed before December 30, 2022. 

Recent Court Rulings Applying FAPA Have Varied

New York trial court rulings on FAPA have varied. The key issue is whether or not the act’s retroactive affects may be constitutional. Five New York trial courts have declined to apply FAPA retroactively. Whereas, seven others have said the act does apply retroactively.

Two federal court decisions have also found that it may.  One found FAPA applied retroactively such that the mortgage owner’s discontinuance of a prior foreclosure action.

In New York State Court, The Decisions Are Split.

Here are seven cases where the courts have found FAPA does apply retroactively:

• U.S. Bank Tr., N.A. v. Miele, Index 51023/2016 (NY Supr. Westchester Cnty June 21, 2023)
• U.S. Bank Tr., N.A. etc. v. Leonardo, Index No. 14266/2013 (NY Supr. Nassau Cnty June 12, 2023)
• HSBC Bank USA, N.A. v IPA Asset Mgt., LLC, (NY Supr. Suffolk Cnty May 16, 2023)
• Deutsche Bank v. Cheng, (NY Supr. Nassau Cnty May 1, 2023)
• Deutsche Bank Natl. Trust Co. v Dagrin, (NY Supr. Queens Cnty Apr. 12, 2023)
• U.S. Bank N.A. etc. v. Pierre, (NY Supr. Suffolk Cnty Feb. 23, 2023)
• Wilmington Savings Fund Doc., FSB v. Madden, 78 Misc.3d 736, 186 N.Y.S.3d 910 (NY Supr. Putnam Cnty Feb. 10, 2023)
• Aspen v. Santoro, 77 Misc.3d 1277(A), 181 N.Y.S.3d 460 (N.Y. Sup. Ct. Suffolk Cnty Jan. 19, 2023) (in dicta, noting dismissal of action as time-barred due to prior acceleration not revoked is “in harmony” with FAPA).

None of the four departments of New York’s Appellate Division have decided the issue.

In the Second Department, a dozen decisions have applied FAPA without determining its constitutionality, but those appeals were briefed before FAPA became effective, without its constitutionality being raised.

They are:

• ARCPE 1 LLC v. DeBrosse, (2d Dep’t June 28, 2023);
• Bank of N.Y. Mellon v. Treitel, (2d Dep’t June 28, 2023);
• Deutsche Bank Nat’l Tr. Co. v. Natal, (2d Dep’t June 21, 2023);
• U.S. Bank N.A. v. Outlaw, (2d Dep’t June 7, 2023);
• SYCP, LLC v. Evans, (2d Dep’t June 7, 2023);
• Bank of New York Mellon v. Joseph, (2d Dep’t May 31, 2023);
• MTGLQ Investors, L.P. v. Singh, (2d Dep’t May 24, 2023);
• U.S. Bank, N.A. v. Onuoha, (2d Dep’t May 17, 2023);
• Bank of N.Y. Mellon v. Stewart, (2d Dep’t May 10, 2023);
• U.S. Bank, N.A. v. Coleman, 215 A.D.3d 780, 185 N.Y.S.3d 701 (2d Dep’t 2023);
• Reinman v. Deutsche Bank Nat’l Tr. Co., 215 A.D.3d 704, 187 N.Y.S. 3d 666 (2d Dep’t 2023);
• GMAT Legal Title Tr. 2014-1 v. Kator, 213 A.D.3d 915, 184 N.Y.S.3d 805 (2d Dep’t 2023); see also
• HSBC Bank USA, N.A. v. Francis, 214 A.D.3d 58, 185 N.Y.S.3d 173 (2d Dep’t 2023) (denying consolidation because one foreclosure action was time-barred and noting in dicta, “our result may be compelled by [FAPA]”).

MFI-Miami has helped hundreds of people successfully fight to stay in their homes.

The New York FAPA law is homeowner’s life line when facing foreclosure!

MFI-Miami also works with some of the best foreclosure defense litigator in New York. They have stopped foreclosures using FAPA!

Call us today at 888.737.6344 to learn more about how you may be able to use the New York FAPA law to save your home.

Also, Check Out These Articles About FAPA:

New York FAPA Law: How FAPA Can Help Stop Your Foreclosure

New York State Lawmakers Push 6-Year Statute Of Limitations