NY State Senate Bill 2019-S882

Senate Bill S882

2019-2020 Legislative Session

Directs the court to provide notice to the former owners of foreclosed property of the right to file a claim for the excess funds from the sale of the real property

download bill text pdf

Archive: Last Bill Status - Stricken

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

View Actions

	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Mar 19, 2019	recommit, enacting clause stricken
Jan 09, 2019	referred to housing, construction and community development

2019-S882 (ACTIVE) - Details

Law Section:: Real Property Actions and Proceedings Law
Laws Affected:: Amd §§1354, RPAP L; amd §1136, RPT L
Versions Introduced in Other Legislative Sessions:: 2015-2016: S6259
2017-2018: S3948
2021-2022: S3130
2023-2024: S2082

2019-S882 (ACTIVE) - Summary

Directs the court to provide notice to the former owners of foreclosed property of the right to file a claim for the excess funds from the sale of the real property.

2019-S882 (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S882

SPONSOR: YOUNG
 
TITLE OF BILL:

An act to amend the real property actions and proceedings law and the
real property tax law, in relation to requiring the court in a foreclo-
sure action to provide notice to the former owner of the real property
of the right to apply for surplus moneys from the sale of such property

 
PURPOSE:

This bill will require that those who formerly owned foreclosed property
are notified that they may be entitled to a portion of the surplus of
funds remaining after an in rem foreclosure sale.

 
SUMMARY OF PROVISIONS:

Section 1. Adds a new subdivision 5 to section 1354 of the real property
actions and proceedings law to require that after the surplus monies
resulting from an in rem foreclosure tax sale are provided to the court,

the court shall provide notice to the former owner or owners Of the
property of their right to file a written notice of claim to all of a
portion of such proceeds pursuant to section 1361 of the real property
tax law.

Section 2. Adds a new subdivision 4 to section 1136 of the real property
tax law to require a court that has vested title to in rem foreclosed
property to a municipal entity shall notify the former property owner or
owners that they may be entitled to file for any surplus funds which may
result from a future tax sale of such property.

 
JUSTIFICATION:

Currently, there is no state requirement that former owners of a proper-
ty foreclosed upon for failure to pay taxes are notified of their poten-
tial entitlement to any surplus funds which may result when the property
is sold. The bill will close a loophole in state law which was high-
lighted in a recent news article examining the city of Buffalo's
unclaimed tax foreclosure process. The City retained approximately $11.6
million in auction proceeds after the in rem foreclosure sale, which
have never been claimed. The funds would eventually be transmitted to
the state as unclaimed funds. Many former owners and other property
lienholders were never made aware that the sale of their former property
resulted in a surplus to which they may be legally entitled. This bill
requires that a former be owner be notified that there is a potential
surplus when the title is vested in the municipality and again, if,
after the property has been sold by the municipality so that they will
be afforded know- ledge of the existence of a surplus and their right to
file a claim for a portion of those funds.

 
LEGISLATIVE HISTORY:

2017,2018: S.3948/A.10168 Passed Senate
2016: S.6259 Passed Senate

 
FISCAL IMPLICATIONS:

None.
 
EFFECTIVE DATE:
Immediate.

2019-S882 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                    882
 
                        2019-2020 Regular Sessions
 
                             I N  S E N A T E
 
                              January 9, 2019
                                ___________
 
 Introduced  by  Sen.  YOUNG  -- 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 and the
   real property tax law, in relation to requiring the court in  a  fore-
   closure action to provide notice to the former owner of the real prop-
   erty  of  the  right to apply for surplus moneys from the sale of such
   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. THE COURT SHALL PROVIDE NOTICE TO THE FORMER OWNER OR OWNERS OF THE
 FORECLOSED REAL PROPERTY OF THE EXISTENCE OF  SURPLUS  MONEYS  RESULTING
 FROM  THE  SALE AND THEIR RIGHT TO FILE A WRITTEN NOTICE OF CLAIM TO ALL
 OR A PORTION OF SUCH  PROCEEDS  PURSUANT  TO  SECTION  THIRTEEN  HUNDRED
 SIXTY-ONE OF THIS ARTICLE.
   §  2. Section 1136 of the real property tax law is amended by adding a
 new subdivision 4 to read as follows:
   4. NOTICE TO FORMER OWNERS. IN THE EVENT THE COURT DIRECTS THE SALE OF
 REAL PROPERTY PURSUANT TO THIS SECTION, THE COURT SHALL  PROVIDE  NOTICE
 TO  THE  FORMER  OWNER  OR  OWNERS  OF THE FORECLOSED REAL PROPERTY THAT
 OWNERSHIP OF SUCH PROPERTY HAS BEEN TRANSFERRED TO A MUNICIPALITY  OR  A
 TAX  DISTRICT,  THAT  AFTER  THE  SALE THEREOF THERE IS A POTENTIAL THAT
 SURPLUS MONEYS MAY RESULT FROM THE SALE  AND  IN  THE  EVENT  A  SURPLUS
 RESULTS,  SUCH  OWNER  OR  OWNERS  SHALL  HAVE A RIGHT TO FILE A WRITTEN
 NOTICE OF CLAIM TO ALL OR A PORTION OF SUCH PROCEEDS PURSUANT TO SECTION
 THIRTEEN HUNDRED SIXTY-ONE OF THE REAL PROPERTY ACTIONS AND  PROCEEDINGS
 LAW.
   § 3. This act shall take effect immediately.

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD04125-01-9

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