NY State Senate Bill 2013-S5750A

Senate Bill S5750A

2013-2014 Legislative Session

Directs county clerks to submit to the office of court administration, on a quarterly basis, an itemized report on the surplus moneys for the sales of foreclosed properties

download bill text pdf

Archive: Last Bill Status - In Senate Committee Housing, Construction And Community Development Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 08, 2014	referred to housing, construction and community development
Jun 17, 2013	print number 5750a
Jun 17, 2013	amend and recommit to housing, construction and community development
Jun 12, 2013	referred to housing, construction and community development

Bill Amendments

Original

A (Active)

2013-S5750 - Details

See Assembly Version of this Bill:: A7953
Current Committee:: Senate Housing, Construction And Community Development
Law Section:: Real Property Actions and Proceedings Law
Laws Affected:: Amd §§1354 & 1355, RPAP L

2013-S5750 - Summary

Directs county clerks to submit to the office of court administration, on a quarterly basis, an itemized report on the surplus moneys for the sales of foreclosed properties; requires referees to submit report of sale to the county clerk, the former owner of the real property, and the attorney or representative of the former owner.

2013-S5750 - Sponsor Memo

                                BILL NUMBER:S5750

TITLE OF BILL:  An act to amend the real property actions and
proceedings law, in relation to reports of the sales of foreclosed
real property

PURPOSE OF THE BILL: Currently, there is no mechanism in state law
which requires notification to a homeowner whose property was sold due
to a judgment of foreclosure and sale to be notified if there are any
surplus funds available after such sale. Also there is no requirement.
for the county clerk, who the surplus funds are deposited with, to
give updates to the courts of deposited amounts.  This lack of
coordinated communication has led to instances where funds which are
due to the homeowner are never deposited and/or the homeowner is never
notified of the existence of these surplus funds.  This legislation
will rectify both situations by formalizing a process of notification
of surplus funds (or the lack thereof) to homeowners as well as to the
courts.

SUMMARY OF SPECIFIC PROVISIONS:

Section 1: Amends Section 1354 of the Real Property Actions and
Proceedings Law by adding a new section subdivision five requiring on
a quarterly basis, each county clerk to submit to the Office of Court
Administration (OCA) a list of all surplus moneys deposited due to a
judgment. of foreclosure and sales of real property.

Section 2: Amends Section 1355 of the Real Property Actions and
Proceedings Law to require that thirty days after completing the sale,
the officer making the sale must notify the former homeowner and their
attorney of record, in clear and plain language, of any and all
surplus monies that may be available to the homeowner after the
foreclosure sale is finalized.

JUSTIFICATION:  Too often, homeowners who are struggling to pay their
mortgage have every available cent tied up in their house. When forced
to sell this house due to a judgment of foreclosure and sale, at times
there is some equity available after the house has been sold. For many
homeowners this is all they have to live on or use to find other
housing. In essence, this home was their "savings account". This
available money after all tax liens, bills due and fees owing are paid
is known as "surplus funds".

Normally, these surplus funds are deposited with the county clerk.  In
recent published news reports, however, there have been reports of
referees failing to deposit the correct amount of surplus funds from a
foreclosure sale in the custody of county clerks where it should have
been be deposited. What this fraud however revealed is that there is
no system in place by which the courts, homeowners and the county
clerk can ensure that all monies due and owed to a the former
homeowner are available for their use. In fact there is no mechanism
by which the homeowner owed the surplus funds is notified in a clear
concise manner that these funds are available. Therefore, not only is
the opportunity for fraud ripe but also the possibility that
homeowners who have just faced the loss of their home, are missing out
on access to funds which may help them start a new chapter in their
life.


This legislation should address these glaring gaps in the law by
requiring two simple notification procedures. First it will require
reporting by the county clerk to the courts. Although some courts in
New York have started investigating surplus funds issues on their own,
this legislation hopes to ensure that all information regarding what
has been deposited in the custody of the county clerk is delivered to
the courts in a timely and consistent manner in order to avoid any
failure of ensuring that the records of the courts match the records
of the county clerks.

The second notification will require the officer making the final sale
of the property notify the homeowner in a clear and concise manner of
any surplus funds resulting from the sale and informing them of their
possible availability to the homeowner. Currently no rules set forth
by the courts or New York state law ensures this process is done.

PRIOR LEGISLATIVE HISTORY: None. This is new legislation

FISCAL IMPLICATIONS: None.

EFFECTIVE DATE: This law shall take effect on the first of January
next succeeding the date on which it shall have become law.

2013-S5750 - Bill Text download pdf

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  5750

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                              June 12, 2013
                               ___________

Introduced  by  Sen.  KLEIN  -- read twice and ordered printed, and when
  printed to be committed to the Committee on Housing, Construction  and
  Community Development

AN  ACT  to  amend  the  real  property  actions and proceedings law, in
  relation to reports of the sales of foreclosed real property

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  Section 1354 of the real property actions and proceedings
law is amended by adding a new subdivision 5 to read as follows:
  5. ON A QUARTERLY BASIS, EACH COUNTY CLERK SHALL SUBMIT, TO THE OFFICE
OF COURT ADMINISTRATION, AN ITEMIZED LIST OF ALL SURPLUS MONEYS  ARISING
FROM  JUDGMENT FORECLOSURES AND SALES OF REAL PROPERTY IN THE COUNTY AND
PAID INTO THE COURT PURSUANT TO SUBDIVISION FOUR OF THIS SECTION  DURING
THE  PREVIOUS  THREE  MONTH PERIOD. SUCH ITEMIZED LIST SHALL INCLUDE THE
AMOUNT OF SURPLUS MONEYS HELD FOR EACH FORECLOSURE  OR  SALE,  THE  SALE
PRICE  OF  THE  REAL  PROPERTY,  THE STREET ADDRESS OF THE REAL PROPERTY
SOLD, THE REAL PROPERTY TAX IDENTIFICATION NUMBER OF THE  PROPERTY,  AND
THE  NAME  OF THE FORMER OWNER OF THE REAL PROPERTY OR HIS OR HER REPRE-
SENTATIVE.
  S 2. Subdivision 1 of section 1355 of the real  property  actions  and
proceedings law, as added by chapter 312 of the laws of 1962, is amended
to read as follows:
  1.  Within  thirty  days  after  completing the sale and executing the
proper conveyance to the purchaser, unless such time be extended by  the
court  within  said  thirty days, the officer making the sale shall file
with the clerk, THE COUNTY CLERK OF THE COUNTY IN WHICH THE REAL PROPER-
TY IS LOCATED, THE FORMER OWNER OF THE REAL PROPERTY, AND  THE  ATTORNEY
OF RECORD OR REPRESENTATIVE OF THE FORMER OWNER OF THE REAL PROPERTY his
OR  HER  report under oath of the disposition of ALL the proceeds of the
sale, accompanied by the vouchers of the persons to whom  payments  were
made,  AND  INCLUDING  ANY  INFORMATION  ON SURPLUS OR POTENTIAL SURPLUS

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD11062-03-3

S. 5750                             2

MONIES THAT WERE PAID TO OR SHOULD BE RETAINED BY SUCH FORMER  OWNER  OF
THE  REAL  PROPERTY  AFTER  ALL  OTHER  LIENS HAVE BEEN SATISFIED.   THE
PROVISION OF SUCH REPORT TO THE FORMER OWNER OF THE REAL PROPERTY AND TO
HIS  OR  HER  ATTORNEY  OF RECORD OR REPRESENTATIVE SHALL BE BY MEANS OF
FIRST CLASS MAIL AND ELECTRONIC TRANSMISSION  REQUIRING  ACKNOWLEDGEMENT
OF  RECEIPT BY THE RECIPIENT; PROVIDED, FURTHER, THAT SUCH REPORT TO THE
FORMER OWNER AND ATTORNEY OF RECORD SHALL  CONTAIN  A  CLEAR  AND  PLAIN
STATEMENT  THAT  PROMINENTLY DISCLOSES THAT SURPLUS MONIES ARE OR MAY BE
OWED TO OR AVAILABLE TO SUCH FORMER OWNER AFTER  SUCH  FORECLOSURE  SALE
HAS BEEN FINALIZED.
  S  3. This act shall take effect on the first of January next succeed-
ing the date on which it shall have become a law.

2013-S5750A (ACTIVE) - Details

See Assembly Version of this Bill:: A7953
Current Committee:: Senate Housing, Construction And Community Development
Law Section:: Real Property Actions and Proceedings Law
Laws Affected:: Amd §§1354 & 1355, RPAP L

2013-S5750A (ACTIVE) - Summary

2013-S5750A (ACTIVE) - Sponsor Memo

                                BILL NUMBER:S5750A

TITLE OF BILL:
An act
to amend the real property actions and proceedings law, in relation to
reports of the sales of foreclosed real property

PURPOSE OF BILL:
This legislation institutes a process to notify homeowners and the
courts of any surplus funds remaining after sale of a home pursuant
to a judgment of foreclosure and sale.

SUMMARY OF PROVISIONS: OF BILL:

Section 1: Amends § 1354 of the Real Property Actions and Proceedings
Law by adding a new section subdivision five requiring on a quarterly
basis, each county clerk to submit to the Office of Court
Administration (OCA) statements of deposit for surplus moneys
resulting from a judgment of foreclosure and sale of real property,
with each statement of deposit to include the amount of surplus
moneys paid into the court, the names of the parties and the index
number associated with the related foreclosure action as well as the
name of the referee that conducted the sale.

Section 2: Amends § 1355 of the Real Property Actions and Proceedings
Law to require that thirty days after completing the sale, the

officer making the sale must notify the former homeowner and their
attorney of record, in clear and plain language, of any and all
surplus monies that may be available to the homeowner after the
foreclosure sale is finalized.

JUSTIFICATION:
When homes are sold due to a judgment of foreclosure and sale, at
times, there is some equity available after the house has been sold.
This available money after all tax liens, bills due and fees owing
are paid is known as surplus moneys.

Under current law, a Referee conducting a foreclosure sale is required
to submit a report to the county clerk within thirty days of
completing the sale, outlining the disposition of the proceeds of the
sale along with vouchers of persons to whom payments were made. Any
surplus funds are required to be deposited with the county clerk.

However, under current law, there is no requirement or procedure to
notify a homeowner of any surplus funds that may be available to them
at the county clerk's office after a foreclosure sale.
In addition, currently, there is no statutory requirement for the
county clerk to give updates to OCA of any surplus funds deposited
after a foreclosure sale.

This legislation would ensure two important notification procedures
one to homeowners and the other to OCA of any surplus funds resulting
from foreclosure sales to better track such funds

LEGISLATIVE HISTORY: New bill, 2013.


FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
None.

EFFECTIVE DATE:
This law shall take effect on the first of January next succeeding the
date on which it shall have become law.

2013-S5750A (ACTIVE) - Bill Text download pdf

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 5750--A

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                              June 12, 2013
                               ___________

Introduced  by  Sen.  KLEIN  -- read twice and ordered printed, and when
  printed to be committed to the Committee on Housing, Construction  and
  Community  Development  -- committee discharged, bill amended, ordered
  reprinted as amended and recommitted to said committee

AN ACT to amend the  real  property  actions  and  proceedings  law,  in
  relation to reports of the sales of foreclosed real property

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Section 1354 of the real property actions  and  proceedings
law is amended by adding a new subdivision 5 to read as follows:
  5. ON A QUARTERLY BASIS, EACH COUNTY CLERK SHALL SUBMIT, TO THE OFFICE
OF  COURT ADMINISTRATION, STATEMENTS OF DEPOSIT FOR SURPLUS MONEYS ARIS-
ING FROM JUDGMENT FORECLOSURES AND SALES OF REAL PROPERTY IN THE  COUNTY
AND  PAID  INTO  THE  COURT PURSUANT TO SUBDIVISION FOUR OF THIS SECTION
DURING THE PREVIOUS THREE MONTH PERIOD. SUCH STATEMENTS OF DEPOSIT SHALL
INCLUDE THE AMOUNT OF SURPLUS MONEYS PAID INTO THE COURT FOR EACH  FORE-
CLOSURE  OR  SALE, THE INDEX NUMBER ASSOCIATED WITH THE RELATED FORECLO-
SURE ACTION, THE NAMES OF THE PARTIES IN THE RELATED FORECLOSURE ACTION,
AND THE NAME OF THE REFEREE THAT CONDUCTED THE SALE.
  S 2. Subdivision 1 of section 1355 of the real  property  actions  and
proceedings law, as added by chapter 312 of the laws of 1962, is amended
to read as follows:
  1.  Within  thirty  days  after  completing the sale and executing the
proper conveyance to the purchaser, unless such time be extended by  the
court  within  said  thirty days, the officer making the sale shall file
with the clerk, THE COUNTY CLERK OF THE COUNTY IN WHICH THE REAL PROPER-
TY IS LOCATED, THE FORMER OWNER OF THE REAL PROPERTY, AND  THE  ATTORNEY
OF RECORD OR REPRESENTATIVE OF THE FORMER OWNER OF THE REAL PROPERTY his
OR  HER  report under oath of the disposition of ALL the proceeds of the
sale, accompanied by the vouchers of the persons to whom  payments  were
made,  AND  INCLUDING  ANY  INFORMATION  ON SURPLUS OR POTENTIAL SURPLUS

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD11062-05-3

S. 5750--A                          2

MONIES THAT WERE PAID TO OR SHOULD BE RETAINED BY SUCH FORMER  OWNER  OF
THE  REAL  PROPERTY  AFTER  ALL  OTHER  LIENS HAVE BEEN SATISFIED.   THE
PROVISION OF SUCH REPORT TO THE FORMER OWNER OF THE REAL PROPERTY AND TO
HIS  OR  HER  ATTORNEY  OF RECORD OR REPRESENTATIVE SHALL BE BY MEANS OF
FIRST CLASS MAIL AND ELECTRONIC TRANSMISSION  REQUIRING  ACKNOWLEDGEMENT
OF  RECEIPT BY THE RECIPIENT; PROVIDED, FURTHER, THAT SUCH REPORT TO THE
FORMER OWNER AND ATTORNEY OF RECORD SHALL  CONTAIN  A  CLEAR  AND  PLAIN
STATEMENT  THAT  PROMINENTLY DISCLOSES THAT SURPLUS MONIES ARE OR MAY BE
OWED TO OR AVAILABLE TO SUCH FORMER OWNER AFTER  SUCH  FORECLOSURE  SALE
HAS BEEN FINALIZED.
  S  3. This act shall take effect on the first of January next succeed-
ing the date on which it shall have become a law.

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