Have you ever heard of the term “short sale”? If you are a lawyer, did you ever represent a buyer purchasing from a seller who was either in default on his mortgage or against whom a foreclosure action had already been commenced?
If you are buying from a homeowner whose property is in foreclosure or has defaulted on her loan, or as a lawyer you represent such a buyer, then you need to be aware that New York has passed a strict and somewhat draconian notice requirement to effectuate a sale.
This law can be found in the Real Property Law 265-a, and is known as the Home Equity Theft Prevention Act. It governs sales of homes that are in foreclosure or default. If the sale is protected by the Act, and the buyer fails to fulfill any of the requirements listed below including attaching a notice of rescission, a seller may be able to legally cancel the contract; even years after the house was sold. A seller may also be able to sue the buyer for triple damages.
WHY DON’T MANY REAL ESTATE LAWYERS CARE OR KNOW ABOUT THE STATUTE?
WHY DON’T MANY REAL ESTATE LAWYERS CARE OR KNOW ABOUT THE STATUTE?
