A borrower in New York received a foreclosure complaint but failed to answer within the required time period. The lender is seeking a default judgment. Under New York's foreclosure laws, what additional step must the lender complete before obtaining the default judgment?
Correct Answer
B) File an affidavit of merit demonstrating a valid cause of action
New York requires lenders seeking default judgments in foreclosure cases to file an affidavit of merit. This affidavit must demonstrate that the lender has a valid cause of action and has reviewed the facts supporting the foreclosure claim, helping prevent improper foreclosures.
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Related Topics & Key Terms
Key Terms:
Related Concepts
RESPA is a federal law that requires lenders to provide borrowers with information about settlement costs, prohibits kickbacks and referral fees, and limits escrow account deposits. It applies to federally related mortgage loans.
The secondary mortgage market is where existing mortgage loans are bought and sold between lenders, investors, and government-sponsored enterprises (GSEs) like Fannie Mae, Freddie Mac, and Ginnie Mae.
TILA is a federal law that requires lenders to disclose the true cost of credit to borrowers, including the annual percentage rate (APR), total finance charges, and loan terms. It is implemented by Regulation Z.
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