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

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.