New York Enacts Zombie Property Law

New York recently enacted the Zombie Property Remediation Act of 2019 (the Act), which allows municipalities to compel mortgagees to either commence or complete mortgage foreclosure proceedings or issue a certificate of discharge of the mortgage for any abandoned property (i.e., zombie property).  The Act went into effect on December 18, 2019.

In general, if a property has been certified abandoned or deemed vacant and abandoned under New York law, the Act authorizes the city, village, or town in which the property is located to commence judicial proceedings to compel mortgagees to: (i) if the note is in default, commence foreclosure proceedings within three months and meet all deadlines to ensure the case is ready to be moved to judgment within a reasonable time period that is less than one year; (ii) if foreclosure proceedings have already commenced, file the necessary motions and paperwork to move the case to judgment foreclosure within three months; or (iii) issue a certificate of discharge of the mortgage within three months and file a satisfaction of the mortgage.