Bill > S06971

This bill relates to mortgage foreclosure actions, particularly those involving subordinate loans purchased when already in default. The bill introduces several key provisions that aim to increase transparency and protect borrowers. It requires plaintiffs (typically lenders or loan purchasers) in foreclosure proceedings to provide detailed documentation, including a complete payment history and a comprehensive custodial file documenting the note's chain of ownership. For subordinate loans purchased while in default, plaintiffs must disclose the purchase date and amount paid, with specific calculations provided if the loan was part of a larger portfolio. The bill also establishes a statute of limitations for actions on subordinate bonds or notes, setting a three-year window from the purchase date or the existing legal time limit, whichever is shorter. Additionally, the bill prevents plaintiffs from demanding payment beyond the amount they paid for the defaulted loan plus a maximum interest rate, and it ensures that defenses based on statute of limitations or lack of standing cannot be automatically waived. These provisions are designed to provide more protection for property owners facing foreclosure and to create more accountability in mortgage lending and foreclosure practices.

Housing and Urban Affairs

https://www.nysenate.gov/legislation/bills/2025/S6971