An MBS Trust Filed A Class Action Lawsuit In Federal Court Against New York State Alleging FAPA Is Unconstitutional
Last month, MBS Trust filed a class action lawsuit in the U.S. District Court for the Northern District of New York. Brougham Fund I Trust is challenging the constitutionality of New York State’s Foreclosure Abuse Prevention Act (FAPA). The plaintiff alleged FAPA retroactively altered the statute of limitations for mortgage foreclosure actions. Thus, FAPA rendered thousands of mortgages unenforceable. The MBS trusts allege this deprives lenders and investors of vested contractual rights and secured interests in real property.
Specifically, the complaint alleged FAPA’s retroactive application violated: (i) the Takings Clause of the Fifth Amendment of the U.S. Constitution, by effecting “an uncompensated taking of property.”
The MBS Trust also claims it violates the Contracts Clause of the U.S. Constitution by “substantially” impairing mortgage holders’ contractual rights. In addition, they claim it violates the Due Process Clause of the Fourteenth Amendment. They claim it also deprives mortgage holders of vested property and contract rights “without adequate justification, notice, or compensation.”
The plaintiff defined the putative class as comprising of:
The plaintiff also seeks declaratory relief on belf of the putative class including just compensation and attorneys’ fees. The case remains pending.
You Can Read More About How New York’s FAPA Law Can Help You Save Your Home On MFI-Miami Below:
New York FAPA Law: How FAPA Can Help Stop Your Foreclosure
New York Foreclosure Defense Strategies That Work
