S T A T E O F N E W Y O R K
________________________________________________________________________
698
2019-2020 Regular Sessions
I N A S S E M B L Y
(PREFILED)
January 9, 2019
___________
Introduced by M. of A. L. ROSENTHAL -- read once and referred to the
Committee on Judiciary
AN ACT to amend the administrative code of the city of New York, in
relation to requiring notification by mortgagees commencing foreclo-
sure actions to aid in the identification and improvements of at-risk
properties
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Section 27-2109.1 of the administrative code of the city of
New York is amended by adding a new subdivision d to read as follows:
D. 1. ANY MORTGAGEE THAT COMMENCES AN ACTION IN A COURT OF COMPETENT
JURISDICTION IN THE STATE OF NEW YORK TO FORECLOSE A MORTGAGE ON A
MULTIPLE DWELLING WITH TEN OR MORE UNITS SHALL PROVIDE WRITTEN NOTICE TO
THE DEPARTMENT WITHIN FIFTEEN DAYS OF SERVICE OF THE PLEADINGS COMMENC-
ING SUCH ACTION. IF SUCH ACTION WAS COMMENCED BEFORE THE EFFECTIVE DATE
OF THE LOCAL LAW THAT ADDED THIS SECTION, AND REMAINS PENDING AS OF SUCH
EFFECTIVE DATE, NOTIFICATION SHALL BE PROVIDED WITHIN THIRTY DAYS OF
SUCH EFFECTIVE DATE. FOR PURPOSES OF THIS SUBDIVISION DEPARTMENT SHALL
MEAN THE DEPARTMENT OF HOUSING PRESERVATION AND DEVELOPMENT.
2. SUCH NOTICE SHALL INCLUDE, BUT IS NOT LIMITED TO, THE FOLLOWING
INFORMATION: (I) THE NAME OF THE MORTGAGEE PLAINTIFF COMMENCING SUCH
ACTION AND THE MAILING ADDRESS, TELEPHONE NUMBER AND E-MAIL ADDRESS OF
SUCH MORTGAGEE PLAINTIFF, AND, WHEN APPLICABLE, THE NAME OF A PRINCIPAL
OR CORPORATE OFFICER OF SUCH MORTGAGEE PLAINTIFF, AND THE MAILING
ADDRESS, TELEPHONE NUMBER AND E-MAIL ADDRESS OF SUCH PRINCIPAL OR CORPO-
RATE OFFICER; (II) THE NAME, MAILING ADDRESS, TELEPHONE NUMBER AND
E-MAIL ADDRESS OF THE DEFENDANT IN SUCH ACTION; (III) THE IDENTIFICATION
OF SUCH RESIDENTIAL REAL PROPERTY BY STREET ADDRESS AND BLOCK AND LOT
NUMBER; (IV) THE DATE OF THE COMMENCEMENT OF SUCH ACTION; (V) THE COURT
IN WHICH SUCH ACTION WAS COMMENCED AND THE INDEX NUMBER OF SUCH ACTION;
(VI) THE PROPERTY'S APPRAISED FAIR MARKET VALUE; (VII) THE AMOUNT OF THE
PRINCIPAL BALANCE OWED UNDER THE MORTGAGE BEING FORECLOSED, INCLUDING
INTEREST AND PRINCIPAL ARREARS, LATE FEES AND ANY OTHER SUMS DUE AND
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD04685-01-9
A. 698 2
OWING AS OF THE DATE OF FILING OF THE COMPLAINT; (VIII) THE INTEREST
RATE AND MATURITY DATE OF THE MORTGAGE BEING FORECLOSED, INCLUDING THE
AMOUNT, IF ANY, NECESSARY TO BRING THE LOAN CURRENT AS OF THE DATE OF
FILING OF THE COMPLAINT; (IX) A LIST, INCLUDING AMOUNTS, OF ANY OTHER
INDEBTEDNESS ON THE RESIDENTIAL REAL PROPERTY THAT IS THE SUBJECT OF THE
FORECLOSURE ACTION AS SET FORTH IN THE PLEADINGS; (X) WHETHER THERE IS
ANY GOVERNMENT INVESTMENT IN THE PROPERTY; (XI) WHETHER THERE ARE ANY
OUTSTANDING MUNICIPAL ARREARS; (XII) WHETHER SUCH PROPERTY HAS A CERTIF-
ICATE OF OCCUPANCY; (XIII) ANY CODE VIOLATIONS THAT THE PROPERTY
CURRENTLY HAS; AND (XIV) SUCH OTHER INFORMATION AS THE DEPARTMENT MAY
REQUIRE BY RULE.
3. THE DEPARTMENT SHALL THEN MAKE A DETERMINATION OF WHETHER SUCH
PROPERTY BEING FORECLOSED ON IS AN "AT-RISK" PROPERTY. IN MAKING ITS
DETERMINATION THE DEPARTMENT SHALL CONSIDER SUBPARAGRAPHS (VI) THROUGH
(XIII) OF PARAGRAPH TWO OF THIS SUBDIVISION, AND ANY OTHER INFORMATION
THE DEPARTMENT FINDS RELEVANT TO MAKING ITS DETERMINATION. FOR PURPOSES
OF THIS SECTION AN "AT-RISK" PROPERTY SHALL MEAN A PROPERTY IN PHYSICAL
AND/OR FINANCIAL DISTRESS.
4. IN ANY FORECLOSURE PROCEEDING UNDER THIS SECTION WHERE THE DEPART-
MENT HAS DECLARED THE PROPERTY TO BE AT-RISK, THE DEPARTMENT MAY MOVE TO
HAVE A RECEIVER APPOINTED OR REPLACED. THE DEPARTMENT SHALL PROVIDE A
LIST OF APPROVED RECEIVERS AND MANAGING AGENTS TO THE OFFICE OF COURT
ADMINISTRATION WHICH SHALL REQUIRE THAT THE COURT APPOINT A RECEIVER
FROM SUCH LIST WITHIN ONE HUNDRED EIGHTY DAYS AFTER THE EFFECTIVE DATE
OF THIS SUBDIVISION. ANY RECEIVER OR MANAGING AGENTS SHALL BE MADE A
PARTY TO THE FORECLOSURE PROCEEDINGS.
5. A MORTGAGEE SHALL NOTIFY THE DEPARTMENT WITHIN FIFTEEN DAYS OF THE
DISCONTINUANCE OF AN ACTION FOR WHICH NOTICE PURSUANT TO PARAGRAPH ONE
OF THIS SUBDIVISION HAS BEEN RECEIVED BY THE DEPARTMENT, THE ISSUANCE OF
A JUDGMENT IN SUCH ACTION, OR THE SALE OF THE REAL PROPERTY AS A RESULT
OF SUCH ACTION.
6. THE DEPARTMENT MAY COLLECT A TWO PERCENT FEE ON THE SALE OF THE
REAL PROPERTY AS A RESULT OF SUCH ACTION. SUCH MONIES SHALL BE PROVIDED
TO THE RECEIVER FOR THE PURPOSES OF REHABILITATING THE PROPERTY, WITH
THE EXPENDED MONEY BECOMING A PRIORITY LIEN ON THE PROPERTY.
§ 2. Section 27-2130 of the administrative code of the city of New
York is amended to read as follows:
§ 27-2130 Grounds for appointment of receiver. 1. Whenever the depart-
ment certifies that any condition in violation of this chapter or other
applicable law in any multiple dwelling or any part of its premises
constitutes a serious fire hazard or is a serious threat to life, health
or safety, it may, upon failure of the owner to comply with an order to
correct such conditions issued pursuant to section 27-2125 of article
five of this subchapter, apply for the appointment of a receiver to
repair and correct the violations.
2. WHENEVER ANY MORTGAGEE COMMENCES AN ACTION IN A COURT OF COMPETENT
JURISDICTION IN THE STATE OF NEW YORK TO FORECLOSE A MORTGAGE ON A
MULTIPLE DWELLING WITH TEN OR MORE UNITS AND WHERE THE DEPARTMENT HAS
DECLARED THE PROPERTY BEING FORECLOSED ON TO BE AN "AT-RISK" PROPERTY
PURSUANT TO SECTION 27-2109.1 OF THIS CHAPTER, THE DEPARTMENT MAY MOVE
TO HAVE A RECEIVER APPOINTED OR REPLACED. THE DEPARTMENT MAY PROVIDE A
LIST OF APPROVED RECEIVERS AND MANAGING AGENTS TO THE OFFICE OF COURT
ADMINISTRATION WHICH SHALL REQUIRE THAT THE COURT APPOINT A RECEIVER
FROM SUCH LIST. FOR PURPOSES OF THIS SUBDIVISION DEPARTMENT SHALL MEAN
THE DEPARTMENT OF HOUSING PRESERVATION AND DEVELOPMENT.
§ 3. This act shall take effect immediately.