Discontinuing an old foreclosure didn't reset the clock - and the years finally ran out
New York's foreclosure-abuse law just ended a Brooklyn mortgage claim that lenders had kept alive since 2002.
On August 5, 2026, the Appellate Division, Second Department, affirmed a grant of summary judgment that dismissed a foreclosure as too late. The decision rested on the Foreclosure Abuse Prevention Act (FAPA), the 2022 statute that tightened how long lenders in New York have to bring a foreclosure - and it went against the lender.
The story starts in October 2001. The borrower signed a note with D & M Financial Corp., backed by a mortgage on a Brooklyn property, and allegedly stopped paying that December. In May 2002, Olympus Servicing, L.P. - described in the decision as D & M's alleged assignee - filed to foreclose.
That filing is the whole ballgame. In New York, launching a foreclosure and demanding the full balance "accelerates" the loan: the entire debt becomes due at once, and a six-year window to sue starts counting down.
The property changed hands. In September 2002, Vista Holding, Inc. took title. The 2002 foreclosure was voluntarily discontinued in April 2004.
The loan kept resurfacing. Fairbanks Capital Corp. filed its own foreclosure in February 2003 and obtained a judgment of foreclosure and sale in May 2005. In January 2010, the court vacated it and dismissed the Fairbanks case for lack of standing - Fairbanks could not show it had the right to foreclose.
In October 2013, DLJ Mortgage Capital, Inc. brought the foreclosure behind this appeal. Vista, now the owner, moved to dismiss it as time-barred: the six-year clock started in 2002 with the Olympus action, and nobody ever reset it.
FAPA made that argument stick. Enacted in December 2022, it closed a path lenders had relied on for years. Both courts held that voluntarily discontinuing the 2002 action did not "de-accelerate the mortgage" nor "revive or reset" the statute of limitations. By 2013, DLJ was years past the deadline.
DLJ challenged the statute itself, arguing FAPA could not apply retroactively and was unconstitutional. The court rejected both as without merit.
DLJ also pointed to an earlier appeal it said had settled the timing. The court disagreed: because FAPA was a real change in the law, the judges could revisit the question - and the property owner prevailed.
The court affirmed the dismissal, with costs. Under FAPA, once a lender accelerates, walking away no longer buys a fresh six years.
