Statewide Coalition Applauds New York Legislature for Passing Bill to Prevent Robo-Signing Abuses

Tuesday, June 25, 2013, New York, NY— New Yorkers for Responsible Lending (NYRL) applauds the passage of S4530A/ A5582A, sponsored by Senate Co-Leader Jeff Klein and Assembly Judiciary Chair Helene Weinstein, which will help New Yorkers save their homes by preventing “robo-signing” abuses by lenders in the foreclosure process. The legislation will require lawyers for mortgage lenders, when filing a foreclosure case, to certify that the facts in the complaint are accurate and attach key loan documents.

The bill closes an administrative loophole in the state court system that has allowed lenders’ lawyers to delay submitting paperwork that certifies the legitimacy of the foreclosure lawsuits they file. This delay has prevented thousands of cases from actually moving into the courts, where the two sides are required to enter court-supervised mediation within 60 days of the lender filing proof of service. The long delays make it more difficult for homeowners to obtain an affordable modification to avert foreclosure.

By requiring lenders’ lawyers to submit certifications at the time they file suit, the legislation will deter “robo-signing,” prevent the filing of wrongful foreclosures by lenders who don’t really own the loan, and provide thousands of homeowners with an opportunity to negotiate a fair and affordable loan modification. NYRL calls on the Governor to sign this important piece of legislation.

NYRL is a state-wide coalition of 161 groups, which promotes access to fair and affordable financial services and the preservation of assets for all New Yorkers and their communities. NYRL members represent community financial institutions, community-based organizations, affordable housing groups, advocates for seniors, legal services organizations, and community reinvestment, fair lending, and consumer advocacy groups.

For more information, please contact Jacob Inwald at 646-442-3634.

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