LIEB BLOG

Tuesday, April 07, 2020

Are You at Risk to Exposure to COVID-19? Designate a Guardian with this Form

Andrew M. Lieb, Esq., MPH #listentolieb , #realestateinvestingwithandrewlieb

By Executive Order 202.14, Governor Cuomo has permitted the use of this form for "any parent, a legal guardian, a legal custodian, or primary caretaker who works or volunteers in a health care facility or who reasonably believes that they may otherwise be exposed to COVID-19... [to] designate a standby guardian" for their children:

Designation of Standby Guardian

(NOTE: As used in this form, the term “parent” shall include a parent, a court-appointed guardian of an infant's person or property, a legal custodian, or a primary caretaker, and the term “child(ren)” shall include the dependant infant of a parent, court-appointed guardian, legal custodian or primary caretaker

I _________________________ hereby designate

________________________________________________________________________________________________________________________________________________________________(name, home address and telephone number of standby guardian) as standby guardian of the person and property of my child(ren) (You may, if you wish, provide that the standby guardian's authority shall extend only to the person, or only to the property, of your child, by crossing out “person” or “property”, whichever is inapplicable, above.)

______________________________________________________________________________________________________________________________________________________________

(name of child(ren)).

This appointment as the standby guardian of my child(ren) would be in the best interests of my child(ren) because:

________________________________________________________________________________________________________________________________________________________________

(insert justification for appointment of this person as the standby guardian)

The standby guardian's authority shall take effect: (1) if my doctor concludes in writing that I am mentally incapacitated, and thus unable to care for my child(ren); (2) if my doctor concludes in writing that I am physically debilitated, and thus unable to care for my child(ren) and I consent in writing, before two witnesses, to the standby guardian's authority taking effect; (3) If I become subject to an administrative separation such that care and supervision of the child will be interrupted or cannot be provided; or (4) upon my death.

In the event the person I designate above is unable or unwilling to act as guardian for my child(ren), I hereby designate

________________________________________________________________________________________________________________________________________________________________

(name, home address and telephone number of alternate standby guardian), as standby guardian of my child(ren).

I also understand that my standby guardian's authority will cease sixty days after commencing unless by such date he or she petitions the court for appointment as guardian.

I understand that I retain full parental, guardianship, custodial or caretaker rights even after the commencement of the standby guardian's authority, and may revoke the standby guardianship at any time.

Signature:

Address:

Date:

I declare that the person whose name appears above signed this document in my presence, or was physically unable to sign and asked another to sign this document, who did so in my presence. I further declare that I am at least eighteen years old and am not the person designated as standby guardian.

Witness' Signature:

Address:

Date:

Witness' Signature:

Address:

Date:

Penalties for Violating Executive Orders on Coronavirus Expanded AGAIN

Andrew M. Lieb, Esq., MPH #listentolieb , #realestateinvestingwithandrewlieb

By Executive Order 202.14, Governor Cuomo enacted new penalties for violating Coronavirus Executive Orders, in addition to what we discussed in our blogs - Penalties for Keeping Your Real Estate Opened in Coronavirus Expanded and What Happens When You Ignore the Essential Services Executive Order.

The new penalty order states as follows:

The enforcement of any violation of the foregoing directives on and after April 7, 2020, in addition to any other enforcement mechanism stated in any prior executive orders, shall be a violation punishable as a violation of public health law section 12-b(2) and the Commissioner of Health is directed and authorized to issue emergency regulations. The fine for such violation by an individual who is participating in any gathering which violates the terms of the orders or is failing to abide by social distancing restrictions in effect in any place which is not their home shall not exceed $1,000.

You've been warned.

New York State Courts Are Reopening for Non-Essential Matters

Anonymous coronavirus , coronavirus legal updates

New York State courts are reopening.

On April 7, 2020 Judge Marks issued a memorandum to all trial court justices and judges outlining his plan for reopening the trial courts to non-essential matters beginning on Monday April 13, 2020. A full copy of the memorandum can be found HERE.

Judge Marks' April 7, 2020 memorandum states:

Going forward, the existing prohibition on the filing of new non-essential matters will continue. However, although our planning is ongoing, starting next Monday, April 13, we will take certain preliminary steps to open up access - remote access - to the courts for non-essential pending cases. This means that judges should review their case inventories to identify cases in which court conferences can be helpful in advancing the progress of the case, including achieving a resolution of the case. Judges can also schedule conferences at the request of the attorneys, and can be available during normal court hours to address discovery disputes and other ad hoc concerns. The conferences will need to be conducted remotely, by Skype or by telephone. Judges' personal staff will be able to assist judges remotely, as needed.

New York State courts have been closed to non-essential matters since March 22, 2020 when Chief Administrative Judge Lawrence K. Marks issued Administrative Order 78/20, which we blogged about HERE.

What will change on Monday, April 13?
Immediately, it appears that the courts are finding success in their remote operations for essential matters are looking to expand those capabilities to non-essential matters which make up the bulk of the caseload in the trial courts. Not only does the memorandum permit judges to conduct remote conferences on cases that are already pending before them, it encourages them to do so. Judges can schedule conferences and parties can request them as well.

The memorandum advises judges to examine their calendars, prioritize cases that will benefit from conferences, decide pending motions to clear backlogs, and to reduce their dockets while there are no new filings.

The big takeaway is that judges' chambers will be staffed and operational - conducting conferences and resolving motions to help clear their dockets. Your pending lawsuits are no longer frozen and progress will be made.

What don't we know?
There are some key limitations in this memorandum that cannot be overlooked:

Going forward, the existing prohibition on the filing of new non-essential matters will continue.

It is clear that as of now, you cannot commence a new action in NYS courts (you can commence a new action in the Federal courts). That means no new lawsuits in NYS courts. It is not clear, however, if that means you can file new papers on pending actions. For instance, it is unclear if you are permitted to file a new motion on a pending action, or even an answer to a complaint that was already filed and served. For now, existing administrative and executive orders tolling time limitations still control.

What to expect going forward.

Judge Marks realizes that a total freeze on court operations is unnecessary. While in-person appearances in a judge's courtroom or chambers are sometimes necessary for a civil matter in the Supreme Court, it is rarely mandatory. Remote conferences can handle most preliminary conferences, discovery disputes, and status conferences. In-person appearances are unnecessary to resolve most motions, and oral argument can be conducted over Skype, Zoom, etc. Civil parts in the Supreme Court can operate at nearly 100% capacity without opening their doors to the bar.

I expect Judge Marks to reopen the civil parts of the Supreme Court in stages, gradually increasing their capacity until everything except trials can move forward while the rest of the country remains closed due to COVID-19.

Courts that heavily rely upon in-person appearances, such as landlord-tenant court and the housing court, will be slower to reopen, but those actions are stayed anyway so there is less emphasis on figuring out remote operations for those parts.

Look for continuing guidance from Judge Marks and local administrative Judges later this week and early next week.

Can any of this become permanent?

It is no secret that it is exceptionally difficult to force large institutions to adopt opportunities presented by advances in technology. For example, even though we have electronic filing, attorneys still need to appear in person to file physical motion papers in some courts that are too stubborn to change their old procedures. Even though some states permit telephone conferences, some courts in New York force attorneys to appear in their courtroom just to tell the judge that they are on schedule with their discovery and don't need any help from the court. That is a waste of time, money, and the courts' limited resources.

Perhaps the changes forced by COVID-19 will open the courts' eyes to the increased efficiency and productivity that technology can bring to our stubborn industry. Listen to our podcast about the future of the courts HERE - Court System is Archaic | Modernization Needed ASAP.

2021 NYS State Budget Enacts Paid Sick Leave Law

Mordy Yankovich Employment Law , New York State Budget

On April 2, 2020, Governor Cuomo announced the 2021 New York State Budget which includes a statewide paid sick leave law. The new law states, in summary, as follows:

Every employer is required to provide employees with annual sick leave beginning on January 1, 2021; the amount and pay required is dependent on the number of employees:

Employers with four (4) or fewer employees and a net income of less than one (1) million dollars in the prior tax year must provide up to forty (40) hours of unpaid sick leave per year.
Employers with 5-99 employees (and employers who have four (4) or fewer employees and a net income greater than one (1) million dollars) must provide up to forty (40) hours of paid sick leave per year.
Employers with a 100 or more employees must provide fifty-six (56) hours of paid sick leave per year.

Sick leave accrues at a rate of one (1) hour for every thirty (30) hours worked. Employers may provide all of the required hours at the beginning of the year.

Employees may use sick leave under the following circumstances:

Employee has a a mental or physical illness or injury (regardless if it has been diagnosed or employee requires medical care).
To care for a family member who has an illness or injury.
To take various precautionary measures; seek treatment or services as a result of the employee or family member being a victim of domestic violence.

Employers who deny employees sick leave or retaliate against an employee for taking sick leave may be liable for substantial damages including but not limited to: back pay, front pay, attorneys' fees, civil penalties and liquidated damages up to $20,000.

Paycheck Protection Program - Regulations Explained

Andrew M. Lieb, Esq., MPH #listentolieb , #realestateinvestingwithandrewlieb

The Coronavirus Aid, Relief, & Economic Security Act (CARES Act), signed into law on 3/27/2020, includes expeditious relief for America's small businesses through loans funded at $349 billion.

§1102 of the CARES Act establishes the Paycheck Protection Program (PPP) under the SBA 7(a) Loan Program & §1106 provides forgiveness of up to the full principal of loan.

To fulfill the expeditious intent of providing relief to small businesses, the SBA issued its final rule on 4/2/2020 without the typical 30-day delay for effectiveness.

We will be discussing the PPP in great detail on Real Estate Investing with Andrew Lieb this Sunday at noon on LI News Radio (WRCN / FM103.9) - If you are in business, don't miss this important segment - it could save your financial life.

Here is a Summary of the Interim Final Rule found at 13 CFR Part 120:

Loan Terms:

No collateral
No personal guarantee
No fees
Loan payments deferred 6 months (interest accrues)
2-year maturity
1% interest rate
Maximum loan $10MM

Loan Amount (calculation methodology):

Aggregate payroll costs from last 12 months
Subtract amounts paid to employee over $100K
Divide net of steps 1 & 2 by 12
Multiply step 3 by 2.5
Add outstanding amount of an Economic Injury Disaster Loan made from 1/31/2020 to 4/3/2020 less advances

Loan Forgiveness Availability:

Employees are on the payroll for 8 weeks
Money used for payroll, rent (lease dated before 2/15/2020), mortgage interest (obligation incurred before 2/15/2020), or utilities (service agreement before 2/15/2020)
75% of loan forgiven must be used on payroll
Payroll includes:

Small business = Salary, wages, commission, cash tips, vacation / parental / family /medical / sick leave, allowance for separation / dismissal, employee benefits (health / retirement), state / local employment tax
Independent Contractor = wage, commission, income, or net earnings

Payroll doesn’t include:

Employee with principal residence outside US
Salary over $100k (prorated)
Fed employment tax from 2/15/2020 to 6/30/2020
Qualified sick & family leave wages

To prove proper payments, lenders can rely on borrower’s documentation without any verification requirements

Application:

SBA Form 2483 (lender submits SBA Form 2484)
Applicant certifies that “[c]urrent economic uncertainty makes this loan request necessary to support the ongoing operations of the applicant.
Available from 4/3/2020 to 6/30/2020 or until exhausted
Borrower can only get 1 loan
First-come, first service
E-signature / consent permitted

Eligibility:

Must be small business, non-profit, independent contractor (sole proprietor)
Must have < 500 employees (certain exceptions if bigger) with principal place of residence in US
Must be in operations on 2/15/2020 with W2 employees
Must submit proof of eligibility of:

Payroll processor records
Payroll tax filings
Form 1099-Misc
Income & expenses for sole proprietorship
If don’t have above, bank records to demonstrate qualifying payroll

Ineligibility:

You are engaged in illegal activity under federal, state or local law (no legal marijuana)
Household employer of nannies / housekeepers
Owner of 20% or more is incarcerated, on probation / parole, subject to indictment, criminal information, arraignment, or convicted of felony in last 5 years
Delinquent / defaults on SBA loan within last 7 years

Misuse Penalties:

Knowingly using loan for unauthorized purposes is fraud
False statements on application is up to 5 year imprisonment / up to $250K fine + up to 2 years imprisonment / up to $5K fine + up to 30 years imprisonment / up to $1MM fine

Lenders Fees Paid from SBA:

5% of loans up to $350K
3% of loans over $350K & less than $2MM
1% of loans at least $2MM

Agent Fees Paid by Lender from its Fees:

1% of loans up to $350K
0.5% of loans over $350K & less than $2MM
0.25% of loans at least $2MM

· Questions should be made to Lender Relations Specialist at the local SBA Field Office

“Unemployment on Steroids”: Cares Act Extends Unemployment Coverage to Independent Contractors and Provides an Additional $600 to Individuals Receiving NYS Benefits

Mordy Yankovich Cares Act , coronavirus

In response to many workers losing their jobs as a result of COVID-19, the federal government is providing unemployment insurance assistance in addition to what is currently offered by the States. Some members of Congress aptly referred to the new law as “unemployment on steroids.” The law provides the following additional unemployment insurance benefits:

Extends eligibility to independent contractors, individuals who are self-employed, or cannot work (individuals who can telework are not covered) for a reason directly related to COVID-19. In order to apply for Pandemic Unemployment Assistance ("PUA"), you must first apply and be determined ineligible to receive New York State unemployment insurance benefits.
Provides an additional $600 a week to all individuals receiving State unemployment insurance benefits. In New York State, if you are receiving the minimum benefits, the maximum benefits ($504 per week) or somewhere in between, you will receive an additional $600 per week. The federal benefits are retroactive to January 27, 2020 and expires on July 31, 2020. It is unclear from the information currently available whether you are entitled to the additional $600 if you are receiving partial unemployment benefits from New York State (hours/salary are reduced by employer).
Provides an additional 13 weeks of benefits (NYS currently offers 26 weeks of unemployment benefits).

According to NYSAR - Real Estate Brokers Can Conduct Showings - What Are Your Business Ethics?

Andrew M. Lieb, Esq., MPH #listentolieb , #realestateinvestingwithandrewlieb

According to NYSAR, Empire State Development clarified that "[t]he following functions of real estate and/or realtors (sic) are considered essential: residential home and commercial office showings; home inspections; and residential appraisers."

Now that it's permissible, the question turns to whether real estate salespersons / associate brokers should be conducting showings?

This is the biggest ethical question for real estate brokers today.

Ironically, Lieb School is in the midst of creating a new CE course on ethical business practices, which is a required course for license renewal on and after 7/1/2021. We are now incorporating this situation into the course as a case study for our students to determine their own business ethics in real estate brokerage.

Unlike laws, business ethics refers to appropriate business practices on controversial subjects that are driven by moral concerns. Showing a house during the coronavirus pandemic is a practice that needs to be driven by your moral concerns.

When it comes to morals and values there is not a one size fits all answer to any question. This is the answer that I gave to a friend in response to his text requesting my take on the fact that "realtors were just declared essential services:"

It's not on the empire state development webpage so it's probably a responsive email to a clarification request from NYSAR. We got one today that my law firm can do in- person closings. That being said, we are trying to avoid them at all costs and have our office working remotely. It's good and bad that the clarification was issued. It's good that smart brokers are authorized to help people in need, but it unfortunately gives permission to the idiots in our industry to spread coronavirus and put their lives and the lives of others in jeopardy all for a dollar. I would not show a senior's house if they live there. I would not show an immunocompromised person's house if they live there. I would not do public open houses. I would limit my in-person contact to the extent necessary while always wearing PPE. If not for the business ethics that require it, at least for the fact that I refuse to bring coronavirus to my family. We will get through this, but we must be smart and pick health over money at each turn for money without health is useless. Stay safe my friend.

If you would like to further explore this topic, we have a special guest on our radio show this Sunday at noon on WRCN (FM 103.9) - www.listentolieb.com - iheart.com (LI News Radio).

Stay safe my friends.

LIEB Permitted to Close Real Estate Deals by NYS

Andrew M. Lieb, Esq., MPH #listentolieb , #realestateinvestingwithandrewlieb

On April 2, 2020 we received word from NYS Empire State Development that "[r]eal estate law practices are deemed essential if it is necessary to be in-person to do the work."

LIEB can close your deals in-person.

Make no mistake, we are a leader in remote closings, but sometimes lenders and title underwriters won't permit such a closing and we have been struggling to find a solution. So, rather than guessing, we made request of the Empire State Development to tell us. This is something every business must do before acting because the penalties are outrageous for non-compliance.

We just got our answer and we are already scheduling closings.

Some people might say that this is a terrible move for a public health advocate. However, my favorite professor during my Master's program taught me to never ignore any of the dimensions of health while only focusing on physical health. Yes, the physical dimension is important. Yet, one can never ignore the spiritual, emotional, social and mental dimensions as well. To that end, there are people who need to close their real estate deal to be healthy. They may be living in limbo with no place to go, there can be financial stress of continued home ownership, there could be too many people occupying one space, or a plethora of other reasons that a closing is necessary.

Remember not to judge someone else's circumstances.

We will be sure to keep social distance and avoid any gatherings to never forget the physical health needs of our team, our clients and ever other individual who is involved in our closing process.

It's Fair Housing Month - Coronavirus Discrimination Must Stop

Andrew M. Lieb, Esq., MPH #listentolieb , #realestateinvestingwithandrewlieb

Equal rights to housing is particularly important during this quarantine.

A quarantine can be a very different experience dependent on your housing situation. Some people are sharing a bathroom with ten others while others are navigating between their indoor pool and their gym. Some have country homes to escape the city while others must walk stairwells infested with COVID-19. This is our current reality as a society.

Make no mistake, in our capitalist society these differences should not only be accepted, but celebrated. Yet, these differences can only be caused by economic differences, not based upon the way we stigmatize people as a result of their demographic characteristics.

Unfortunately, not everyone is observing the law today. According to the CDC, "fear and anxiety about a disease can lead to social stigma toward people, places, or things." In fact, the CDC has identified individuals of "Asian descent" as the current victims of stigma during the coronavirus pandemic. Let's change that starting today.

Today is the start of Fair Housing Month. According to HUD, Fair Housing Month is a time to come together "as a community and a nation to celebrate the anniversary of the passing of the Fair Housing Act and recommit to that goal which inspired us in the aftermath of Rev. Dr. Martin Luther King Jr’s assassination in 1968: to eliminate housing discrimination and create equal opportunity in every community.”

We should do it. We can do it. We must do it.

Executing a New Will While in Quarantine? Avoid Will Deals That Seem too Good to be True

Anonymous #listentolieb , draftsmanship

COVID-19 uncertainty is causing many people to rethink their wills and advanced directives.

With the acceptance of video notarization, which we blogged about HERE, many attorneys are advertising remote will execution ceremonies that remove the traditional requirement that the testator execute their will in a room with two witnesses and an attorney. The seeming ease of a remote will execution has caused a race to the bottom as attorneys compete on price for business. Things have gotten so desperate that I've seen an attorney advertise a will for $100.00. Is it too good to be true?

While the availability of remote notarization does make remote will execution ceremonies possible, it is important not to forget the fundamental requirements of a will signing. If your will is rejected by the Surrogate's Court because you failed to conform to the requirements of EPTL §3-2.1 all of your estate planning and forward thinking may have been for nothing. Avoid the nightmare scenario of your well-intentioned plans falling apart.

The following is a list of some considerations which your attorney should be addressing when deciding how they are going to conduct a remote will execution ceremony:

Your attorney must draft a will that conforms to your intentions.
You must execute your will in the presence of two witnesses, or your signature must be acknowledged to the witnesses after it has already been affixed. Your remote execution procedure must qualify as "in the presence of".
Your witnesses must sign the will itself within thirty days of one another.
Your witnesses should sign affidavits attesting to the proper execution of your will.
Your attorney should sign an attorney draftsman's affidavit.
Your witnesses' affidavits should be notarized, and your attorney draftsman's affidavit should be notarized.
Your original signature, the witnesses' original signatures, the attorney draftsman's original signature, and the notary's original signatures should all be combined into one original document which can be presented for probate.

If you think your attorney can do all of that for $100.00, it's probably too good to be true.

Covered Employers Must Comply With the WARN Act Prior to Laying off Employees

Mordy Yankovich coronavirus , Employment Law

Employers contemplating reductions in force as a result of the Coronavirus must consider the applicable Federal and State laws prior to effectuating any layoffs, including but not limited to the WARN Act, to avoid substantial penalties.

The New York WARN ("Worker Adjustment and Retraining Notification Act") Act is not suspended during the Coronavirus. Rather, the notice must be distributed, as detailed below, as soon as possible under the circumstances (as opposed to the regular 90 day notice requirement). Failure to provide such notice may result in the employer being required to pay back wages and/or the imposition of civil penalties.

When does the WARN Act apply?:

The New York WARN Act (which is more stringent than the Federal law) covers employers with 50 or more employees under the following circumstances:

Plant or unit closing affecting 25 or more workers;
Mass layoff of 25 or more full-time workers if the workers comprise of at least 33% of all workers at the physical site;
Mass layoff of 250 or more full-time workers; and
Certain other reductions of employees' work hours.

Notice

The WARN Act requires ninety (90) day notice of a mass layoff or plant closing to:

Affected employees;
New York State Department of Labor;
Employee/Union Representatives; and
The Local Workforce Investment Board.

The notice must include the following:

Name/address where plant closing or mass layoff is to occur;
Explanation as to whether the employment loss will be permanent or temporary;
Expected date of scheduled layoff(s);
Affected positions and number of affected employees in each position;
Name(s) of applicable union/employee representatives; and
Contact information of company representative who can provide additional information.

Consult with your employment attorney to confirm the satisfaction of all of these requirements before implementing layoffs.

Protect Your Family with an Updated Will

Lauren Lieb

Protect your family with an updated Will. $750 (discounted price)

Call 646.216.8009 or email info@liebatlaw.com to get it done from your own living room #observephysicaldistancing

Podcast | Tax Strategies and Coronavirus

Lauren Lieb #listentolieb , coronavirus

We interview CPA - Anthony Tramontano about how to limit your taxes legally in the era of #coronavirus #listentolieb #liebatlaw

Click here to download the podcast

Evictions Stopped Under Coronavirus Stimulus - CARES Act

Anonymous coronavirus , coronavirus legal updates

The Coronavirus Aid, Relief, and Economic Security or “CARES” Act was enacted into law on March 27, 2020. In addition to the relief enumerated in two of our recent articles (Nuts & Bolts of Stimulus Package - House Passes 2 Trillion Dollar Stimulus Package and Forbearance and Foreclosure Moratorium in Coronavirus Stimulus), the CARES Act also provides relief to residential tenants.

Under the CARES Act, from March 27, 2020 to July 25, 2020, landlords of 1- to 4-family and multifamily (5 or more) properties with FHA, Fannie Mae, or Freddie Mac mortgage loans may NOT:

Initiate a legal action to recover possession based on nonpayment of rent or other fees or charges;
Charge fees, penalties or other charges related to the nonpayment of rent;
Require the tenant to vacate with less than 30-days’ notice; and
Issue the 30-day notice to vacate until after July 25, 2020.

In addition, landlords who obtain a forbearance on their multifamily mortgage due to a financial hardship caused by the COVID-19 outbreak are prohibited from doing the above before their forbearance period expires.

Forbearance and Foreclosure Freeze in Coronavirus Stimulus

Anonymous coronavirus , coronavirus legal updates

On March 27, 2020, the historic stimulus package known as the Coronavirus Aid, Relief, and Economic Security or “CARES” Act was enacted into law.

In addition to the relief enumerated in our recent blog (Nuts & Bolts of Stimulus Package - House Passes 2 Trillion Dollar Stimulus Package), the CARES Act also includes mortgage relief in the form of forbearance periods and foreclosure moratoriums for federally backed mortgages on 1-4 family homes and multifamily (5 or more) homes.

Which mortgages are covered?

Federally backed mortgage loans secured by a first or subordinate lien on residential real property (including individual units of condominiums and cooperatives) for 1- to 4-families and for on multifamily residential real property (5 or more dwelling units) are covered, these include loans:
insured by the Federal Housing Administration;
insured under section 255 of the National Housing Act;
guaranteed under section 184 or 184A of the Housing and Community Development Act of 1992;
guaranteed or insured by the Department of Veterans Affairs;
guaranteed or insured by the Department of Agriculture;
made by the Department of Agriculture; or
purchased or securitized by the Federal Home Loan Mortgage Corporation (Freddie Mac) or Federal National Mortgage Association (Fannie Mae).

What relief is available?

For 1-4 family properties:

Forbearance period of 180 days, which may be extended for an additional 180 days, upon the borrower’s request;
No late fees, interest, or penalties during the forbearance period beyond those scheduled or calculated as if borrower is current on the mortgage; and
Foreclosure moratorium – servicers are prohibited from moving for a foreclosure judgment or order of sale, or execute a foreclosure-related eviction from March 18, 2020 to May 17, 2020;

For multifamily properties:

Forbearance period of 30 days, which may be extended for up to 2 additional 30-day periods, upon the borrower’s request. Note that the forbearance is only applicable to multifamily mortgage loans that were current on payments as of February 1, 2020. Also, tenants may not be evicted nor issued a notice to vacate for nonpayment or late payment of rent during the forbearance period.
Foreclosure moratorium: servicers are prohibited from moving for a foreclosure judgment or order of sale, or execute a foreclosure-related eviction from March 18, 2020 to May 17, 2020.

What is the process for requesting a forbearance?

For 1-4 family properties: Requests for a forbearance may be made by submitting a borrower’s attestation to a financial hardship caused by the COVID-19 emergency. No other documentation is required for the initial 180-day forbearance to be granted.
For multifamily properties: Requests for a forbearance may be submitted to the servicer orally or in writing, through an affirmation that the multifamily borrower is experiencing a financial hardship during the COVID-19 emergency.

Nuts & Bolts of Stimulus Package - House Passes 2 Trillion Dollar Stimulus Package

Mordy Yankovich coronavirus , stimulus

The House passed the Senate's massive stimulus package today, paving the way for the President to sign the bill into law.

The bill includes the following:

Tax free payments to individuals of up to $1,200; $2,400 for married couples and additional $500 for children under the age of 16. Amount of payments are dependent on adjusted gross income. No eligibility if:

Individuals earning $99,000 or more
Married couples earning $198,000 or more;

Employees will be entitled to an additional $600 of weekly unemployment benefits in addition to the amount they are entitled to from their State. Part-time employees and independent contractors, even if not covered under their State law, will be entitled to these federal payments, as well;
$377 billion in loans and grants for small businesses;
$500 billion in loans for struggling businesses;
$150 billion for hospitals treating coronavirus patients;
Defers student loan payments for six (6) months; waives interest;
Foreclosures and evictions are stayed where mortgages are backed by the federal government.

No More Construction - Essential Service Guidance Updated

Andrew M. Lieb, Esq., MPH #listentolieb , #realestateinvestingwithandrewlieb

On March 27, 2020 at 11AM, Empire State Development refined the definition of essential businesses or entities in NYS as to construction, as follows:

All non-essential construction must shut down except emergency construction, (e.g. a project necessary to protect health and safety of the occupants, or to continue a project if it would be unsafe to allow to remain undone until it is safe to shut the site).

Essential construction may continue and includes roads, bridges, transit facilities, utilities, hospitals or health care facilities, affordable housing, and homeless shelters. At every site, if essential or emergency non-essential construction, this includes maintaining social distance, including for purposes of elevators/meals/entry and exit. Sites that cannot maintain distance and safety best practices must close and enforcement will be provided by the state in coordination with the city/local governments. This will include fines of up to $10,000 per violation.

For purposes of this section construction work does not include a single worker, who is the sole employee/worker on a job site.

Be warned.

Penalties for Keeping Your Real Estate Opened in Coronavirus Expanded

Lauren Lieb #listentolieb , #realestateinvestingwithandrewlieb

By Executive Order 202.11, Governor Cuomo enacted new penalties, in addition to what we discussed in our blog - What Happens When You Ignore the Essential Services Executive Order, if you keep your real estate open in violation of an Executive Order.

The new penalty order states as follows:

During the period when an Executive Order limiting operation of a type of facility or limiting the number of persons who may occupy any space is in effect, any operation of such a facility or occupancy of any such space by more than the number of persons allowed by said Executive Order shall be deemed to be a violation of law and in particular, but not by way of limitation, shall be deemed to be a violation of the Uniform Code or other local building code in effect in the jurisdiction in which the facility or space is located. In the event of any such violation, any state, county, or local police officer authorized to enforce laws within the jurisdiction in which the space or facility is located is authorized to remove persons from such space or facility. In addition, in the event of such violation, any state, county, or local code enforcement official or fire marshal authorized to enforce the Uniform Code or other local building code within the jurisdiction in which the facility or space is located is authorized to issue an appearance ticket, a Notice of Violation, an Order to Remedy such violation, which shall require immediate compliance, and/or a Do Not Occupy Order to any owner, operator, or occupant of any such facility or space. Nothing in this provision shall limit the authority of any governmental unit or agency to take such other and/or additional enforcement actions to the extent necessary to ensure compliance with such occupancy-related directives or facility operation-related directives.

As such, here is your exposure:

Charge of "violation of law"
Charge of "violation of the Uniform Code or other local building code"
Removal by police
Receipt of an appearance ticket, Notice of Violation, and/or Order to Remedy
Receipt of a Do Not Occupy Order to the "owner, operator, or occupant of any such facility or space"

Oh, by the way, you are KILLING people. So, stop it and close when you are ordered to close.

The end.

Real Estate Brokerage / Salesperson License Renewal Extended

Lauren Lieb #listentolieb , #realestateinvestingwithandrewlieb

By way of Executive Order 202.11, licensees "time to renew a license" has been extended "to the 30th day following the expiration of this Executive Order."

This Executive Order expires on April 26, 2020 and as such renewal is extended to May 26, 2020 for real estate brokers and salespersons.

Podcast | NY Court System is Archaic | Modernization Needed ASAP

Lauren Lieb Andrew Lieb , coronavirus

Attention Governor Cuomo the court system needs your leadership. We need e-signature protocols, e-notarization rules, servers, virtual meetings, and so much more. It’s time to modernize the legal industry and revamp the economy for both the state and businesses alike. As a true leader, you can transform the Coronavirus shutdown from a negative into a blue ocean opportunity for New York State.

Listen to our podcast here

Podcast | Creative Lease Workout Options

Lauren Lieb #listentolieb , Andrew Lieb

Latest Podcast - Sharing creative lease solutions for commercial landlords and tenants who have lost revenue from coronavirus.

Click here to listen to podcast

Podcast | Foreclosure Avoidance Through Forbearance Negotiations

Lauren Lieb #listentolieb , coronavirus

Businesses devastated by quarantine should proactively negotiate forbearances with their lenders to avoid foreclosure and monetary judgments.

Click here to listen to the Podcast

NYS 90-Day Mortgage Relief Plan – DFS Regulation Issued

Anonymous 90-day mortgage relief , coronavirus

On March 24, 2020, the details of NYS’ COVID-19 mortgage help came to light.

Specifically, the New York State Department of Financial Services promulgated 3 NYCRR 119 in response to Governor Cuomo’s Executive Order 202.9.

Here is a Q&A about the details:

What is the COVID-19 Relief Program?
The COVID-19 Relief Program requires DFS regulated institutions to make applications for a 90-day forbearance of any payment due on a residential mortgage of New York Property to individuals residing in New York and who demonstrates financial hardship as a result of the COVID-19 pandemic.

How long is the Program effective?
The Program shall be in effect until June 19, 2020, but may be extended if necessary.

Are mortgage payments waived under the Program?
The Program does not expressly require institutions to waive mortgage payments.

When can a borrower apply for the Program?
On or before April 3, 2020, regulated institutions are required to e-mail, publish on their website, mass mail, or broadly communicate to customers how to apply for COVID-19 relief and provide their contact information.

Which institutions are covered under the Program?

DFS-regulated institutions are covered under the Program. They are New York regulated banking organizations covered by the New York Banking Law and all New York regulated mortgage servicers regulated by DFS. This means that the program does not cover National Association lenders (federally charted banks). The Program does not apply to mortgage loans made, insured, or securitized by the United States, Government Sponsored Enterprise, Federal Home Loan Bank, and lenders, issuers, servicers or trustees of such loans, as well as, servicers for the Government National Mortgage Associations.

Does the Program cover commercial loans?
The Program does not apply to any commercial mortgage or other loans not described in 3 NYCRR 119.

Aside from a 90-day forbearance, is there additional relief available under the Program?
From today until June 19, 2020, or until extended, lenders will provide the following relief to individuals who experience financial hardship from COVID-19:

Waive fees for use of automated teller machines (ATMs);
Waive overdraft fees; and
Waive credit card late payment fees.

Institutions are not limited to offering the above types of relief and are encouraged to take additional reasonable and prudent actions to COVID-19 affected individuals.

Who is qualified to receive COVID-19 relief?
Regulated institutions must develop their own clear, easy to understand, and reasonably tailored criteria for assessing qualified individuals. The qualifications and process for applying for relief should be published by institutions on or before April 3, 2020.

How are applications processed under the Program?
Regulated institutions are required to develop and implement procedures for expedited processing where they must process and respond to requests immediately and no later than 10 days of receipt of all information reasonably required to process the application. All determinations must be communicated to the applicant in writing and must explain the reasons if the application was denied and a statement that the applicant may file a complaint with DFS if he believes the application was wrongly denied.

Is the Program ready to launch?
More clarity concerning the Program is expected once regulated institutions have published their process for applying for relief. Individuals who are seeking mortgage assistance as a result of the COVID-19 pandemic are encouraged retain counsel as soon as possible to negotiate with their mortgage lenders or servicers. Don’t assume you qualify and get all terms in writing before you stop making mortgage payments.

Title Examination, GAP Insurance, and Recorded Deeds - Closing Title in a Quarantined World

Anonymous coronavirus , coronavirus legal updates

As of March 24, 2020, both the Nassau County and Suffolk County Clerks have suspended in-person access to their offices. As previously reported on our blog, the Chief Administrative Judge of the Courts has ordered that county clerks shall no longer accept any filings, electronic or otherwise. It's still an open question whether this precludes the electronic recording of documents, but there is no doubt that title insurance is a whole lot more complicated right now.

How will your title insurer examine title and issue a policy if they cannot pull non-electronic records? While some clerks have a more robust electronic system than others, can title insurers be confident that the records are up to date given limited staffing and restrictions on filing?

What about the period between closing of title and the recording of your deed? It has always been theoretically (and unfortunately in some instances, actually possible) for a grantor to encumber title to the property you just bought after your title insurer had already performed its search, cleared for closing, and locked in its policy. If there is an even further extended period between closing and recording due to coronavirus closures, it is more vital than ever to ensure that you are protected against these unseen encumbrances.

Traditionally this "GAP Period" requires a special endorsement that protects the purchaser against encumbrances that occur after closing but before the deed is recorded, but will title insurers be willing to insure such an unknown and potentially length time period?

If you are closing in the next few weeks, make sure your attorney has all these questions answered.

What Happens When You Ignore the Essential Services Executive Order

Andrew M. Lieb, Esq., MPH #listentolieb , #realestateinvestingwithandrewlieb

Beyond injuring others and being a terrible person, have you looked-up the exposure for violating Executive Order 202.8.

To remind you, 202.8 is what provides, in pertinent part, that "[e]ach employer shall reduce the in-person workforce at any work locations by 100% no later than March 22 at 8 p.m."

As to exposure for violating 202.8, it provides that "[a]ny business violating the above order shall be subject to enforcement as if this were a violation of an order pursuant to section 12 of the Public Health Law." Then, section 12 of the Public Health Law provides for "a civil penalty of not to exceed two thousand dollars for every such violation" for the first violation and a penalty "not to exceed five thousand dollars for a subsequent violation." However, if your violation "results in serious physical harm to any patient or patients, the penalty is "not to exceed ten thousand dollars."

So, if you infect someone, you are getting charged with a $10K penalty per violation.

Oh, by the way, the State can also get an injunction against your continued violations and potentially shut down your business, remote or otherwise, with that injunction.

Don't be crazy and ignore the order. Instead, if you believe you are essential, apply for a designation here.

Coronavirus in Your Multi-Family / Commercial Building

Andrew M. Lieb, Esq., MPH #listentolieb , #realestateinvestingwithandrewlieb

If you learn that someone is infected with Coronavirus in a unit, do not notify other tenants or conduct cleaning.

Instead, contact your local (County / City) and follow their guidance. Do nothing else.

You are ill-equipped to create a protocol and may further injure your tenants by acting imprudently.

There are privacy concerns, cleanliness concerns, isolation concerns, testing concerns and the like.

Therefore, if you learn of a positive diagnosis in your property, contact your local health department and follow their guidance.

Federal Courts Remain Open Amid the Coronavirus Outbreak

Mordy Yankovich bankruptcy , coronavirus

While New York State Courts are currently not permitting individuals or businesses to commence new matters (with extremely limited exceptions), federal courts (Eastern District of New York and Southern District of New York) remain open. Individuals or businesses can, thus, still file new cases in federal court.

Potential causes of action that can be filed in federal court include, but are not limited to:

Wage and Hour claims pursuant to the Fair Labor Standards act for unpaid wages, overtime, etc.;
Bankruptcy petitions;
Discrimination/Retaliation claims under Title VII (race, age, sex, religion, disability etc.);
Interference with rights under the Family Medical Leave Act.

NYS Mortgage Relief Plan – Guidance from DFS

Anonymous coronavirus , coronavirus legal updates

Following Governor Cuomo’s announcement on a 90-day mortgage relief plan for borrowers affected by the novel coronavirus (COVID-19), the New York State Department of Financial Services (DFS) issued Guidance to regulated financial institutions concerning its implementation. The Guidance urges all regulated financial institutions to do their part in curtailing the effects of COVID-19 on consumers and small businesses by:

Waiving overdraft fees;
Providing new loans on favorable terms;
Waiving late fees for credit card and other loan balances;
Waiving automated teller machine (ATM) fees;
Increasing ATM daily cash withdrawal limits;
Waiving early withdrawal penalties on time deposits;
Increasing credit card limits for creditworthy customers;
Offering payment accommodations, such as allowing loan customers to defer payments at no cost, extending the payment due dates or otherwise adjusting or altering terms of existing loans, which would avoid delinquencies, triggering events of default or similar adverse consequences, and negative credit agency reporting caused by COVID-19 related disruptions;
Ensuring that consumers and small businesses do not experience a disruption of service if financial institutions close their offices, including making available other avenues for consumers and businesses to continue to manage their accounts and to make inquiries;
Alerting customers to the heightened risk of scams and price gouging during the COVID-19 disruptions, and reminding customers to contact their financial institutions before entering into unsolicited financial assistance programs; and
Proactively reaching out to customers via app announcements, text, email or otherwise to explain the above-listed assistance being offered to customers.

Regulated financial institutions are also urged “to work with and provide accommodations to their borrowers during this unprecedented global emergency to the extent reasonable and prudent.” This includes holding off on taking adverse action for defaults. Regulated financial institutions include mortgage bankers, mortgage loan servicers, banks and trust companies, among others. For a full list of DFS-regulated financial institutions, click HERE.

While the efforts of DFS and New York State are definitely acknowledged and appreciated, Borrowers should be aware that the Guidance is simply that, guidance. The Guidance does not legally require financial institutions to take the above-listed actions and only encourages them to do so.

Stay tuned for more updates from New York State and DFS as to specific procedures on the NYS mortgage relief plan.

County Clerks and Court Clerks Forbidden From Accepting Filings

Anonymous coronavirus , coronavirus legal updates

The Chief Administrative Judge of the Courts has issued an order forbidding the filing of all non-essential papers in county clerks and court clerks. This order is statewide and will have far-reaching consequences.

The Order, a copy of which can be found HERE, states:

Pursuant to the authority vested in me, in light of the emergency circumstances caused by the continuing COVID-19 outbreak in New York State and the nation, and consistent with the Governor of New York's recent executive order suspending statues of limitation in legal matters, I direct that, effective immediately and until further order, no papers shall be accepted for filing by a county clerk or a court in any matter of a type not included on the list of essential matters attached as Exh. A. This directive applies to both paper and electronic filings.

Follow the link above to find a list of essential matters, most of which focus on the protection of the life, safety, and well-being of people.

The consequences of this Order are profound. For example, the Suffolk County and Nassau County clerks were both operating on a limited basis, but were still operating. The State's electronic court filing system was still accepting filings which enabled parties to continue litigating so long as it didn't require judicial intervention. New York County's online recording system, ACRIS, was still accepting electronic filings. Based on the wording of this Order, all of that ends today.

Despite this Order, Lieb at Law will proceed with our litigation matters to the maximum extent possible - as long as it doesn't require judicial intervention, we will push forward.

Look for a blog from Steven Siliato later today detailing the effects this Order will have on real estate transactions. Title examination? Race notice recording? GAP title insurance?

Governor Cuomo Issues Statewide Moratorium on Commercial and Residential Evictions and Foreclosures

Anonymous 90-day mortgage relief , Commercial Real Estate

Governor Cuomo has consolidated the patchwork of local foreclosure and eviction laws bubbling up in the wake of the COVID-19 quarantines - and it's a big one.

Executive Order 202.8 states:

There shall be no enforcement of either an an eviction of any tenant, residential or commercial, or a foreclosure of any residential or commercial property for a period of ninety days.

Ninety days from the date of the Order puts us out to June 18, 2020.

One noteworthy aspect of this Order is its application to both residential and commercial properties.

It is vital to note, however, that this does not mean you cannot be in default of your rent or mortgage for the ninety day period. It simply states that there shall be no enforcement of evictions or foreclosures. If you are delinquent on your rent or mortgage during the term of this order, your landlord or lender could commence an eviction or foreclosure proceeding after the order expires.

The interplay of this Executive Order with Executive Order 202.9 (see our prior blog about that, here) creates an opportunity for borrowers to leverage a forbearance with their lender ensuring that they are not delinquent on their mortgage on June 18, 2020.

NYS Mortgage Relief Plans Becomes Clearer, BUT Not Enough

Andrew M. Lieb, Esq., MPH #listentolieb , #realestateinvestingwithandrewlieb

On March 21, 2020, the Governor issued NYS Executive Order 202.9, which provides, in pertinent part, as follows:

Subdivision two of Section 39 of the Banking Law is hereby modified to provide that it shall be deemed an unsafe and unsound business practice if, in response to the COVID-19 pandemic, any bank which is subject to the jurisdiction of the Department shall not grant a forbearance to any person or business who has a financial hardship as a result of the COVID-19 pandemic for a period of ninety days... The Superintendent of the Department of Financial Services shall ensure under reasonable and prudent circumstances that any licensed or regulated entities provide to any consumer in the State of New York an opportunity for a forbearance of payments for a mortgage for any person or entity facing a financial hardship due to the COVID-19 pandemic. The Superintendent shall promulgate emergency regulations to require that the application for such forbearance be made widely available for consumers, and such application shall be granted in all reasonable and prudent circumstances solely for the period of such emergency.

While a cursory reading shows that mortgage help is on the way, many uncertainties remain, including:

What does subject to the jurisdiction of the Department mean in the Order? Specifically, there are two charting systems for banks; federal and state. The Federal Office of the Comptroller of the Currency controls federally chartered banks pursuant to the National Bank Act. Generally, you can tell that a bank is federally chartered because it has the initials N.A. after its name. As a result, NYS doesn't have jurisdiction over federally chartered banks so how does this work if you have a loan through a federal bank like many NYS residents do?
When is the Superintendent promulgating emergency regulations and how are consumers going to understand those regulations if attorneys at law were not labeled as essential services under the quarantine and therefore are becoming less available by the minute? Yes, some law firms are open and working remotely, but for how long with many clerks' offices closed and all court deadlines tolled (yesterday's Executive Order 202.8), including "any specific time limit for the commencement, filing, or service of any legal action, notice, motion, or other process or proceeding."
By adding the words business & entity, is it intended that this applies to both residential and commercial property?
Is there a limit on the amount of the mortgage for this to be applicable?
After the forbearance is over, what happens to the money deferred (i.e., back end balloon, recapitalized, ballooned immediately, something else)?
Will the Superintendent of DFS be answering these questions or someone else; plus, will the answers be part of a regulation or just advisory?

Please don't misunderstand this post. We 100% support the quarantine and also support the forbearance. Instead, this blog is designed to prevent further hardship to the vulnerable who take a leap of faith on their mortgage without first researching facts.

Get facts before you act and the facts aren't out yet - so, CONTINUE PAYING YOUR MORTGAGE for now.

Tuesday, April 07, 2020

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