The bank let a default stall for years - and FAPA left no way back in
A New York appeals court has told Deutsche Bank it waited too long to foreclose, another hard lesson in the state's foreclosure law.
The story starts in November 2011, when Deutsche Bank National Trust Company moved to foreclose a mortgage on a property in Mount Vernon. The borrower never answered and never appeared. That kind of silence usually works in a lender's favor. Here it set up the opposite.
With no one moving the case along, a court dismissed the 2011 foreclosure in April 2015 as abandoned. The rule behind it, CPLR 3215(c), lets a court throw out a case when a plaintiff leaves a default sitting too long. Deutsche Bank tried to revive the matter and was turned down in January 2016. It appealed, then let the appeal lapse.
By August 2021, the bank was back, filing a new foreclosure on the same mortgage. This time the borrower answered, raising the statute of limitations, the clock that caps how long a lender has to sue. His point was simple: the bank had run out of time.
The trial court agreed. Leaning on the Foreclosure Abuse Prevention Act (FAPA), the 2022 New York law that reshaped foreclosure timing, it denied the bank's request for summary judgment, a ruling issued without a full trial, and granted the borrower's cross-motion, ending the case against him. The bank asked for a rethink. In April 2024, the court held its ground.
On July 29, 2026, the Appellate Division, Second Department, affirmed. The bank lost.
The mechanics matter to anyone running default servicing. For years, lenders relied on CPLR 205(a), which hands a plaintiff six months to refile after a case is dismissed on a technicality, even once the limitations clock has run out. FAPA closed that valve for foreclosures. The court explained the law "replaced the savings provision of CPLR 205(a) with CPLR 205-a in actions upon instruments" like this mortgage, and "specifically defines a dismissal pursuant to CPLR 3215 as a form of neglect that precludes a plaintiff from taking advantage of the six-month savings provision of CPLR 205(a)."
Put plainly: because the 2011 case died under CPLR 3215(c), the bank could not use the savings rule to stretch its deadline.
Deutsche Bank also argued that applying FAPA backward was unconstitutional. The court disagreed, citing recent decisions that upheld the law's retroactive reach.
The takeaway for servicers is direct. In New York, a foreclosure dismissed for neglect can become a foreclosure lost for good.
