At the end of 2022, New York Gov. Kathy Hochul signed the Foreclosure Abuse Prevention Act (FAPA) into law. The legislation passed with bipartisan support in both houses of the state legislature last year, but the governor, delayed signing it throughout her campaign despite mounting pressure from housing advocates, state lawmakers and residents throughout the state.
The new law provides protections for homeowners throughout the foreclosure process and will help prevent what at least one state senator from Queens calls “manipulative foreclosure practices disproportionately harmful to communities of color.” That borough has the largest number of foreclosures in New York City.
Restoring the statute of limitations
The chief purpose of the law is to restore the statute of limitations on mortgage lenders’ ability to initiate legal proceedings on foreclosures to six years. This statute of limitations had been essentially eliminated by a New York Court of Appeals decision in 2021.
According to proponents of the new law, that decision allowed lenders to bring multiple lawsuits for a mortgage loan as often and for as long as they wanted to, regardless of when the home went into foreclosure. The Queens lawmaker explained last year that “without the statute of limitations, banks could go back 20 years, 30 years, 50 and 100 years into the past and…grab cases where they have lost repeatedly, and this allows them to keep going until they find the best justice that they can buy.”
The law prevents lenders from challenging the statute of limitations. This had been in effect since the 1960s before it was inadvertently eliminated in that 2021 appeals court case.
Whether you’re dealing with a lawsuit that’s now prohibited under the new law or you’re looking for a way to avoid foreclosure, you shouldn’t try to go up against a mortgage lender on your own. It’s wise to seek legal guidance to protect your rights.