New NY Foreclosure Law Forces Lenders to Apply Your Payments

A very important foreclosure law bill, Assembly Bill A2739, which we discussed at How New York Assembly Bill A2739 Could Give Homeowners a Leg Up in Foreclosure Defense was signed and is effective as of December 12, 2025.

Now, homeowners in default a real edge against foreclosure. The law requires mortgage lenders to accept and immediately apply payments made in reliance on a payoff statement – no more excuses, no more “we’ll hold it in suspense.” As long as you pay where and how your lender says to, your money counts toward your loan balance.

If you’re facing foreclosure and want to make sure every payment counts, contact Lieb at Law, P.C. – because now, your money can finally work for you.

Foreclosure Abuse Prevention Act (FAPA) Is Now Retroactive. Here’s What That Means for NY Foreclosures.

The Foreclosure Abuse Prevention Act (FAPA), which was enacted in December 2022, stops mortgage lenders from abusing the 6-year statute of limitations in foreclosure actions. FAPA achieves this by confirming that once a lender accelerates a mortgage, demanding the entire loan balance, the acceleration is not automatically revoked (de-accelerated) if the lender voluntarily discontinues the action, thereby preventing the lender from attempting to start a new foreclosure case years later.

However, what happens when this acceleration / de-acceleration stuff happened before 2023? 

 

The NYS Court of Appeals (the state's highest court), just ruled that FAPA has "retroactive effect" in Van Dyke v U.S. Bank, Natl. Assn. to the extent that it is invoked in a case where "a final judgment of foreclosure and sale has not been enforced." 

So, even for older cases, FAPA needs to be evaluated. 

If you have such a loan, you should consider bringing a quiet title action to remove the mortgage from your homeownership. If you’re facing a foreclosure or challenging an old acceleration, get legal help now from Lieb at Law, P.C. Our litigation team can review your timeline and use FAPA to protect your home. 

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