Assemblymember Monica Wallace (D-Lancaster) and Senator Tim Kennedy (D-Buffalo) announced Monday that their legislation (A.6976 and S.4190) to help municipalities hold mortgage servicers accountable for maintenance of residential properties in foreclosure was signed by the governor and is now law. The new law, which takes effect immediately, requires mortgage servicers to provide their name and contact information at multiple points during foreclosure proceedings involving one- to four-family residential properties.

Many local government officials have struggled to identify the mortgage servicer who is responsible for maintaining a vacant and abandoned property. This law helps local governments easily identify and contact mortgage servicers in order to enforce maintenance obligations on residential properties in foreclosure.

The 2008 housing crisis resulted in thousands of New Yorkers losing their homes due to foreclosures. Many mortgage servicers failed to perform basic maintenance and upkeep on properties for years as the parties went through foreclosure proceedings, causing many of these so-called zombie homes to become blighted. Issues like overgrown grass, broken windows, peeling paint, and water damage have become common at many of these zombie homes. Neighbors have suffered from the effects of blight, including depressed property values, squatting, and influxes of crime and vermin. These zombie homes also created eyesores in otherwise beautiful neighborhoods and placed undue burdens on local governments.

By requiring mortgage servicers to provide their name and contact information at numerous points during the foreclosure process, this law empowers local governments to hold mortgage servicers accountable if they fail to perform the basic maintenance necessary to keep foreclosed residential properties in safe and habitable condition.

“Far too many beautiful and vibrant neighborhoods have suffered deterioration because some mortgage servicers neglect their obligations to maintain vacant properties,” said Assemblymember Wallace. “This law will help local governments enforce their maintenance obligations and protect neighborhoods from unsightly and potentially dangerous conditions at zombie properties.”

“By requiring this critical step during foreclosure proceedings, this legislation will empower municipalities to more effectively ensure that blighted properties are documented, tracked, and remediated quickly,” said Senator Kennedy. “We thank Governor Cuomo for signing this important legislation into law, and we look forward to seeing this new step streamline the foreclosure process and better preserve our neighborhoods.”

“Zombie and vacant properties remain a top concern for many of our residents, and our Vacant and Abandoned Property Task Force has been working diligently to make sure properties are maintained and kept up to code,” said Town of Cheektowaga Supervisor Diane Benczkowski. “This amended law will provide our Town with a more efficient way to ensure that maintenance obligations are enforced, and we appreciate Assemblymember Wallace and Senator Kennedy for introducing this legislation.”

“Finding mortgage servicer information is often one of the most difficult tasks in the fight against zombie foreclosures,” said Kate Lockhart, Vacant and Abandoned Property Program Director of the Western New York Law Center. “This new law provides servicer name and contact information in multiple publicly available documents throughout the foreclosure process, eliminating hours of tedious phone calls and extra work for already overwhelmed and underfunded municipalities. The Western New York Law Center is grateful for the leadership of Senator Kennedy and Assemblymember Wallace that got this much-needed law passed, and Governor Cuomo for signing the bill. Laws like this one are so important to municipalities addressing zombie properties, especially as we face a potential foreclosure crisis due to the COVID-19 pandemic.”