What's happening
This bill requires mortgage servicers to provide a single point of contact for borrowers who are sixty or more days delinquent seeking loan modifications or foreclosure alternatives.
Why it matters
Creates stronger accountability for mortgage servicers. by legally requiring them to assign a single, accessible contact person to borrowers in serious delinquency, making it harder for servicers to avoid responsibility or provide inconsistent information.
Reduces confusion and delays for struggling homeowners. by ensuring that one individual or team is responsible for communicating all available options, collecting necessary documents, and updating borrowers on the status of their application for modification or foreclosure alternatives.
Helps prevent unnecessary foreclosure actions. by mandating that the single point of contact has access to decision-makers who can pause foreclosure proceedings when loss mitigation options are being considered, potentially keeping more people in their homes.
Expands consideration for alternative solutions. by requiring that borrowers be evaluated not just for federal programs, but also for proprietary or investor-specific options, which could increase the likelihood of finding a suitable resolution to mortgage delinquency.
Albany, before your first meeting.
Every bill that moved yesterday, summarized in a sentence and ranked by impact. The Albany Scorecard follows on Sundays.
Free. Unsubscribe in one click. Want alerts on specific bills? Create an account.
Who cares
Mortgage borrowers sixty or more days delinquent
The bill would require servicers to notify them about access to a single point of contact and provide that contact within ten business days of a request for loss mitigation assistance.
Mortgage servicers
They would have to assign contacts to coordinate documents, explain foreclosure prevention options and application status, and provide updated contact information within five business days of a change.
Borrowers ineligible for the federal Making Home Affordable program
Their assigned contact would have to ensure they are considered for proprietary or other investor loss mitigation options.
Mortgage borrowers in bankruptcy
Their assigned contact would remain until they exhaust all loss mitigation options for which they are potentially eligible and have applied, or their account becomes current.
Headline styles
Help for Struggling Homeowners
Plain English, a few words. Used as the page title.
Sponsors
No co-sponsors yet.
History
- Committed to rules
- Advanced to third reading
- 2nd report cal.
- 1st report cal.592
- Referred to banks
- Returned to senate
- Died in assembly
- Referred to banks
- Delivered to assembly
- Passed senateVote 41–21
- Ordered to third reading cal.1156
- Committee discharged and committed to rules
Show 1 earlier action
- Referred to banks
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
2105
2019-2020 Regular Sessions
IN SENATE
January 22, 2019
Introduced by Sen. SANDERS -- read twice and ordered printed, and when printed to be committed to the Committee on Banks
AN ACT to amend the banking law, in relation to modifying delinquent mortgage loans and single point of contact
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. The banking law is amended by adding a new section 96-e to read as follows:
§ 96-e. Single point of contact; modifying delinquent mortgage loans. 1. For the purposes of this section, "mortgage servicer" shall mean a person or entity responsible for the day to day management of a mortgage loan account, including collecting and crediting period loan payments, managing any escrow account, or enforcing mortgage loan terms either as the holder of the loan note or on behalf of the holder of the loan note.
2. If a borrower is sixty or more days delinquent, the mortgage servicer shall inform the borrower that if the borrower wishes to pursue a loan modification or other foreclosure prevention alternative, the mortgage servicer shall establish a single point of contact for the borrower.
3. Upon written or telephonic communication from a borrower who is sixty or more days delinquent and who requests loss mitigation assistance, the identity of and contact information for a single point of contact shall be provided to the borrower within ten business days. The mortgage servicer shall provide updated contact information to the borrower if the designated single point of contact is changed no later than five business days after the change.
4. The single point of contact shall be responsible for all of the following:
(a) Communicating the options available to the borrower, the actions the borrower must take to be considered for those options, and the
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD05333-01-9
S. 2105 2
status of the mortgage servicer's evaluation of the borrower for those options.
(b) Coordinating receipt of all documents associated with loan modification or loss mitigation activities and notifying the borrower of any missing documents.
(c) Maintaining and providing accurate information about the borrower's situation and current status in the loss mitigation process.
(d) Ensuring that a borrower, who is not eligible for a federal making home affordable program, is considered for proprietary or other investor loss mitigation options.
(e) Having access to individuals with the ability to stop foreclosure proceedings when necessary to comply with the making home affordable program or New York law.
5. The single point of contact shall remain assigned to the borrower's account until the mortgage servicer determines that all loss mitigation options have been exhausted, the borrower's account becomes current, or, in the case of a borrower in bankruptcy, the borrower has exhausted all loss mitigation options for which the borrower is potentially eligible and has applied.
§ 2. This act shall take effect immediately.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the banking law, in relation to modi- fying delinquent mortgage loans and single point of contact
Purpose
The bill requires creditors to provide a single point of contact to borrowers in the foreclosure process who will be responsible for provid- ing accurate account and other information related to the foreclosure process and loss mitigation efforts. The bill requires creditors to provide a dedicated electronic mail address, facsimile number and mail- ing address for borrowers to submit information requested as part of a loan modification, short sale or other loss mitigation option.
Summary of provisions
96-e of the banking law provides that mortgage servicers, as defined in that section, shall designate a person responsible for communications if said borrower's mortgage becomes sixty days or more delinquent.
Read the full memo (813 words)
If a borrower who becomes delinquent by sixty days or more, a mortgage servicer shall designate a single point of contact for the borrower in the event he or she wishes to pursue a loan modification or foreclosure prevention program. The single point of contact shall be responsible for all of the following:
(a) Communicating the options available to the borrower, the actions the borrower must take to be considered for those options and the status of the mortgage servicer's evaluation of the borrower for those options.
(b) Coordinating receipt of all documents associated with loan modifica- tion or loss mitigation activities and notifying the borrower of any missing documents.
(c) Maintaining and providing accurate information about the borrower's situation and current status in the loss mitigation process.
(d) Ensuring that a borrower, who is not eligible for a federal making home affordable program, is considered for proprietary or other investor loss mitigation options.
(e) Having access to individuals with the ability to stop foreclosure proceedings when necessary to comply with the making home affordable program or New York law.
The single point of contact shall remain assigned to the borrower's account until the mortgage services determines that all loss mitigation options have been exhausted, the borrower's account becomes current, or, in the case of a borrower in bankruptcy, the borrower has exhausted all loss mitigation options for which the borrower is potentially eligible and has applied.
§ 2 provides that this act shall take effect immediately.
Existing law
JUSTIFICATION: As our state and our nation slowly recover from the nation's financial crisis, many homeowners are still trying to recover from the financial impact of the crisis. Massive foreclosures have crippled our economy and have made the recovery from the crisis very slow. While the economy strengthens and employment grows, many citizens are trying to rebuild their lives.
One way many homeowners have tried to rebuild their lives is to work to save the largest asset many of them own: their home. As the bottom dropped out of the economy, many citizens lost their jobs and fell behind on their mortgages. Many people who had owned their homes for years or even decades found themselves unable to keep up with their payments even though they may have never missed a payment before the crisis.
As the job market has strengthened and people returned to work, homeown- ers have reached out to their mortgage servicers to determine if there are any federal, state or investor foreclosure mitigation program avail- able to them. Many homeowners were told of these programs and were encouraged to apply. Many homeowners tried to apply for these mitigation programs only to find out that the programs were nearly impossible to gain approval.
On February 9, 2012, the U.S. Attorney General announced that the feder- al government and 49 states had reached a settlement agreement with the nation's five largest mortgage servicers to address mortgage servicing, foreclosure, and bankruptcy abuses (the "National Mortgage Settlement"). The National Mortgage Settlement is the largest consumer financial protection settlement in United States history. The National Mortgage Settlement was made after state and federal investigations into mortgage foreclosure activities revealed extensive mortgage servicing misconduct, including riot limited to, deceptive practices in the loan modification process such as telling borrowers that a loan modification was imminent while simultaneously foreclosing, repeatedly asking for the same docu- ments, denying a modification and not informing the borrowers and giving the borrower incorrect information regarding their modification applica- tion.
This bill will require a mortgagor to appoint to the borrower one contact person who will be responsible for all communications with the borrower and who will be responsible for the entire process. Having one person responsible will make it less likely that a borrower who is trying to save his or her home will fall victim to the bureaucracy of the foreclose mitigation process and of the very large mortgage servi- cers.
Legislative history
This is a new bill.
Fiscal implications
None
Local fiscal implications
None
Effective date
This act shall take effect immediately.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.