The Step-by-Step Foreclosure Process in New York

Foreclosure doesn’t happen all at once. It’s a legal process with a lot of steps—and in New York, it usually takes a long time. That’s a good thing, because it means your family has time to try to fix things.

Here’s how it usually works:

1. Missed Payments

It all starts when your parents fall behind on their mortgage. This might be due to job loss, unexpected bills, or other reasons. Once they miss a few payments, the bank starts calling, sending letters, and trying to collect the money.

2. The 90-Day Letter

Before the bank can even start a foreclosure case in court, they have to send your parents a special warning letter—called a 90-Day Pre-Foreclosure Notice.

This letter says:

“You’re behind. We haven’t started a court case yet, but you have 90 days to catch up, call us, or make a plan.”

It must be sent to everyone listed as a borrower on the mortgage. That 90-day window gives your family time to act.

3. The 30-Day Acceleration Letter

If no agreement is made, the bank sends another letter. This one says that if your parents don’t pay up within 30 more days, the bank will “accelerate” the loan—meaning the entire amount is due at once, not just monthly payments.

This usually means foreclosure is coming soon.

4. Foreclosure Case Begins (Summons and Complaint)

Now the bank officially starts a lawsuit. They file papers in court, and your parents will receive a Summons and Complaint. A process server may physically deliver these papers or post a notice on your front door.

This part usually takes a few weeks to get moving—but once your family receives these papers, it’s very important to take action and get help.

5. Contact a Lawyer or Legal Help

At this point, your parents should speak to a lawyer—either one they hire, or a free legal service (listed later on this site). A lawyer can help explain the court papers, prepare a response, and protect your family’s rights.

6. Answering the Complaint

Your parents have a legal right to respond to the bank’s claims. This is called an Answer, and it’s where your parents can say:

• They disagree with the bank

• They already made the payments

• The bank made mistakes

Even if they don’t know how to respond, a lawyer or housing counselor can help them file the right papers. They usually have 30 days after the first court conference to file their Answer.

7. Settlement Conference

The court will set up a Settlement Conference. This is a meeting where your parents and the bank try to work out a deal. Sometimes the bank offers a new payment plan or loan modification.

These conferences are often postponed so both sides can gather documents, fill out forms, or review offers. It can take several months to get through this part.

8. Court Motions and Foreclosure Steps

If your parents and the bank can’t reach an agreement, the bank asks the court to move forward with foreclosure. This involves multiple steps:

• Order of Reference

The bank asks the court to say your parents have no valid defenses. If approved, the court appoints a Referee to calculate how much your family owes.

• Referee’s Report

The Referee reviews the numbers and writes a report. This becomes the official amount the bank is claiming.

• Judgment of Foreclosure and Sale

If everything is approved, the bank asks the court for permission to sell the house.

• Auction Notice

The house must be advertised in a newspaper for four weeks before the auction. Then the house is sold to the highest bidder—or the bank takes it back.

9. Eviction

Even after the auction, your family doesn’t have to leave right away. The new owner (either a buyer or the bank) must go to court again and start a separate eviction case.

This part moves faster than foreclosure, but your family still has rights. You do not have to leave the home until a judge officially says so.

Takeaways

• This process has a lot of steps—and a lot of time to get help.

• Your family has rights at every stage.

• It’s not instant. It’s not hopeless. And you don’t have to face it alone.