June 23, 2016
Albany, NY

Governor Cuomo Signs Sweeping Legislation to Combat the Blight of Vacant and Abandoned Properties

Governor Cuomo Signs Sweeping Legislation to Combat the Blight of Vacant and Abandoned Properties
Comprehensive Legislative Package Enhances Mandatory Settlement Conferences and Establishes a Consumer Bill of Rights to Help People Remain in Their Homes, Creates the Community Restoration Fund Combats Blight Created By Zombie Properties By Imposing a Pre-Foreclosure Duty on Banks and Servicers to Maintain Zombie Homes, Creating an Electronic Registry of Abandoned Properties, and Expediting Foreclosure For Vacant and Abandoned Properties to Get Them Back on the Market

Governor Andrew M. Cuomo today signed legislation to prevent foreclosures and curb the threat posed to communities by “zombie properties.” The bill was passed as part of the 2016 Legislative Session and is a boon for the economic health and public safety of communities and homeowners who would otherwise be at risk of losing their residences. The legislation combats the blight of vacant and abandoned properties by expediting the rehabilitation, repair and improvement of these properties, and enabling the State to assist homeowners facing mortgage foreclosure. The Governor signed the legislation into law, touring the state and visiting affected communities, at events in Syracuse, Manhattan and Long Island.

“For many New Yorkers, homes are our single most important investment, but that investment can be undermined by the blight of neglected and abandoned properties,” Governor Cuomo said. “For each zombie home that we cure and for each that we prevent with this legislation, we are saving entire neighborhoods from the corrosive effect of blight and neglect. I thank my colleagues in the Assembly and Senate for seeing a crisis and helping to turn it into an opportunity for people to realize the great American Dream of homeownership.”



Attorney General Eric T. Schneiderman said: "This law is major victory for New Yorkers living in communities throughout the state, as it will give regulators and law enforcement the tools they need to revitalize neighborhoods that have been devastated by the proliferation of zombie homes. I applaud Assembly Member Weinstein and Senator Klein for their unwavering commitment to revitalizing communities plagued by zombie homes by working with Governor Cuomo to craft an impressive and meaningful legislative package. I also commend Governor Cuomo for making this issue a priority this session and by acting swiftly to sign this bill into law. As I have long said, zombie homes are an enduring legacy of the housing crisis, but thanks to the advocacy of determined elected officials and advocates, and thousands of motivated New Yorkers, we now have a law that will lift-up communities statewide."

Senate Majority Leader John J. Flanagan said: "Working together, we have passed a responsible measure to address the abandoned and decaying homes in many of our communities known as 'zombie properties. By doing so, we will reverse blight, protect property values and strengthen our economy for the future. I thank Governor Cuomo and our colleagues in the Legislature, especially Senator Jeff Klein, who as leader of the Independent Democratic Conference and our majority coalition partner, focused on this issue like a laser until we achieved a positive result for the people of New York."

Assembly Speaker Carl Heastie said: “While our economy has taken strong and sure steps toward full recovery, high foreclosure rates continue to affect New Yorkers around the state. It is critical that we do all we can to help people remain in their homes and keep neighborhoods safe. This agreement will provide the assurance of stronger protections against predatory foreclosure practices, a more expedient process for transitioning these properties to help communities move past foreclosure, and toward opportunities for home ownership.”

Senate Independent Democratic Conference Leader Jeffrey Klein said: "Today is a victory for every community in New York State. From The Bronx to Buffalo, zombie properties impact every corner of our state resulting in blight and diminished property values for surrounding homeowners. I fought to make this law a reality and now banks will maintain abandoned properties stuck in the legal limbo of foreclosure. Broken windows, open doors and falling facades will no longer mar our communities, and if banks fail to comply, our law empowers the Department of Financial Services to take court action, issue violations and fines. I thank Governor Cuomo for signing this into law, and protecting communities throughout the state."

Senate Democratic Leader Andrea Stewart-Cousins said: "Revitalizing and strengthening our communities is a longstanding priority of both the Senate Democrats and Governor Cuomo. For too long the fabric of our communities have been weakened by these zombie properties and today we can begin moving forward to make sure that our neighborhoods are protected. Stronger neighborhoods help build stronger communities"

The legislation includes several provisions that will help prevent people from losing their homes and addresses the scope of unoccupied and ill-maintained properties, which based on voluntary reporting, is estimated to be over 6,000. Under the new law, reporting is now mandatory, and the number of abandoned homes is anticipated to be even higher.

The legislation includes measures to assist homeowners facing mortgage foreclosure, improve the efficiency and integrity of the mandatory settlement conferences, establish a pre-foreclosure duty to maintain on mortgagees, create an expedited foreclosure process for vacant and abandoned properties, create an electronic vacant property registry, and establish a Consumer Bill of Rights. Specifically, the legislation will:


  • Enhance the Effectiveness of Mandatory Settlement Conferences: The mandatory settlement conferences became law in 2010 to slow foreclosure and give homeowners a better chance to fight the foreclosure. Since its creation, the number of foreclosure default judgments has declined from 80% to less than 20%. This legislation will enhance the effectiveness of settlement conferences even further for homeowners by prescribing the rights and duties of the parties and clarifying how the process should work to best protect homeowners contesting foreclosures and prevent them from losing their homes.
  • Establish a Consumer Bill of Rights informing property owners of their rights in foreclosure proceeds to prevent people from losing their homes: Some homeowners vacate their homes early in the foreclosure process because they are unclear about their rights or face pressure to vacate. The enhanced notice requirements established with this legislation will alleviate this confusion and reduce the resulting abandoned properties by explicitly informing homeowners of their rights
  • Create the Community Restoration Fund (CRF), a new tool for the State of New York Mortgage Agency (SONYMA) to assist homeowners facing mortgage foreclosure. CRF will purchase defaulted mortgage notes from other lenders and offer favorable mortgage modifications to keep homeowners in their residences. CRF will have the ability to forgive a portion of a loan’s principal and make the loan affordable in areas where home values have declined or where a homeowner has experienced a decrease in income.


  • Impose a pre-foreclosure duty on the banks and servicers to maintain vacant and abandoned properties: Previously, a bank or mortgagee had the responsibility of maintaining a vacant property once a judgment of foreclosure and sale was obtained, creating zombie properties and blight in communities. This legislation places the maintenance obligation on a mortgagee when the mortgagee becomes or should have become aware of the vacancy. Under this law, the bank has a duty to maintain and secure a residential real property where there is a reasonable basis to believe it is vacant and abandoned, and faces civil penalties up to $500 per violation, per property, per day for failing to do so.
  • Expedite foreclosure for vacant and abandoned properties: The legislation offers plaintiffs an option for an expedited foreclosure process on bonafide vacant and abandoned properties that homeowners no longer want. To initiate this process, plaintiffs would make an application for an order to show cause upon notice seeking entry of judgment of foreclosure and sale on the grounds that the property is vacant and abandoned.

The legislation requires a foreclosing party to move to auction within 90 days of obtaining a foreclosure judgment. In addition, a foreclosing party would be required to take action to ensure that the property is reoccupied within 180 days of taking title.

  • Establish electronic registry of vacant and abandoned properties. The legislation will promote communication between local governments and mortgagees responsible for property maintenance.
  • In cases where homes are vacant, CRF will offer a mechanism to expeditiously complete a foreclosure and work with land banks, Community Development Financial Institutions, and other local nonprofits to rehabilitate properties and resell them to new buyers.

State Senator Diane J. Savino said: "The subprime mortgage crisis hurts families and communities and I'm proud that today my legislation creating the Community Restoration Fund becomes law. This program, through the State of New York Mortgage Agency, working in conjunction with a council of housing experts, will use settlement funds to keep families facing foreclosure in their homes by refinancing their mortgages. The Community Restoration Fund will work hand-in-hand with localities, non-profits and land banks to identify and purchase properties from federally distressed pools. In addition, dilapidated, abandoned properties across this state, ones which drag down communities, will also be spruced up and turned into much-needed affordable housing. I thank Governor Cuomo for helping us uplift communities throughout the state and helping struggling homeowners avoid foreclosure while simultaneously reducing blight in our communities."

State Senator David J. Valesky said: “New York has become flooded with zombie foreclosures over the past several years and thanks to Governor Cuomo and my colleagues in the legislature, we are taking a major step forward in putting a stop to these eyesores. Throughout this state, there are neighborhoods that are on the cusp of turning the corner and thriving once again yet they are being held back by these properties. With this law now on the books, we have the tools we need to help our communities reach their full potentials.”

Assemblywoman Helene E. Weinstein, Chair of the New York State Assembly Judiciary Committee, said: "It is critical that we pursue every avenue to hold banks accountable and to help New Yorkers remain in their homes. Unfortunately, so many properties that have been abandoned go on to become a burden and an eyesore to the surrounding community. The provisions of this legislation relating to foreclosure would strengthen the rights of homeowners in foreclosure proceedings, keep families in their homes longer, and require banks and their mortgage servicers to maintain abandoned properties in their portfolio to prevent any further neighborhood destabilization. I commend Governor Cuomo for joining with us to enact these homeowner protection and community preservation proposals. "

Assemblywoman Pamela Hunter said: “Zombie properties are a scourge on our communities and prevent emerging neighborhoods from truly flourishing. As these properties become dilapidated and forgotten, they not only discourage businesses from investing in that neighborhood, but they drive down the value of surrounding homes. Getting rid of these blights is an absolute necessity and I want to thank Governor Cuomo for his past efforts and his leadership in ensuring that this bill became law.”

Assemblyman Charles D. Lavine said: “Working together under Governor Cuomo’s leadership, the Assembly and Senate have passed highly comprehensive legislation that will protect our communities and our citizens from the blight of abandoned and deteriorating houses. Because the safety of our neighborhoods must continue to be government's first priority, I am extraordinarily gratified that our Long Island community will now be protected by this most incisive and significant law.”

Assemblyman Michael Kearns said: “The Foreclosure Relief Act has been created to help fight the “Zombie Crisis” in our communities since 2008. Proactive engagement by neighbors, courts, municipalities and banks is required to increase the likelihood of success. To reverse the effects of zombies will require engagement, education, enforcement and execution by all stakeholders interested in removing bank created blight in our neighborhoods. All of us with zombie properties need to be active and informed concerning the new law’s protections, so we meet the challenges of this crisis. I thank Governor Cuomo for signing these bills into law today.”

Suffolk County Executive Steve Bellone said: “From Smithtown to Sag Harbor, unoccupied and ill-maintained homes have directly contributed to the degradation of neighborhoods and communities. These zombie properties have had especially devastating consequences on towns that have already been ravaged by foreclosure and economic instability. I commend Governor Cuomo, and our leaders in the Senate and Assembly, for taking decisive action to end the scourge of zombie properties and making our communities stronger and safer for generations to come.”

Onondaga County Executive Joanie Mahoney said: "Abandoned and dilapidated properties are not just a problem on Onondaga County or in Central New York---they plague communities across the state and country. Governor Cuomo is leading the nation to tackle the issue of "zombie" properties on multiple fronts, and this new law will result in better neighborhoods and a better quality of life throughout New York."​​

Commissioner of NYS Homes and Community Renewal, Jamie S. Rubin said: “This is a great day for New Yorkers living in communities that have endured the blight of “zombie” properties and for homeowners on the brink of foreclosure. Governor Cuomo has given New York powerful tools to tackle the problem of vacant properties that plague too many communities and to reduce the risk of more homes becoming abandoned and empty. Together these bills will help families stay in their homes and remove abandoned properties from neighborhoods. These are real investments in improving lives and communities across New York State.”

Superintendent of Financial Services Maria T. Vullo said: "This groundbreaking legislation provides relief to cities and towns throughout New York State that are suffering the consequences of unmaintained vacant and abandoned properties. It improves and expands upon the best practices that DFS established, by now legally requiring the obligation to maintain for all banks and mortgage servicers in New York and also establishing an expedited foreclosure process. I applaud Governor Cuomo and the Legislature for taking decisive action and stand ready to enforce the law to combat this growing epidemic.”


The FY 2017 Budget invests nearly $20 billion for comprehensive statewide housing and homelessness action plans. Over the next five years, the $10 billion housing initiative will create and preserve 100,000 affordable housing units across the State, and the $10 billion homelessness action plan will create 6,000 new supportive housing beds, 1,000 emergency beds, and a variety of expanded homelessness services.

As part of the Governor’s ongoing efforts to assist future homebuyers and existing homeowners, this investment includes more than $100 million in available funds to help new homebuyers purchase and renovate “Zombie” properties and support existing low- and middle-income homeowners with major repairs and renovations. Funding is available through the New York State Homes and Community Renewal to establish the new Neighborhood Revitalization Program and provide grants for not-for-profit organizations and municipalities throughout the state to rehabilitate, repair and improve homes.

President and Chief Executive Officer, Long Island Partnership, Inc. Peter J. Elkowitz, Jr. said: “We thank Governor Cuomo for making it a priority to address this widespread problem. If we could customize a program to mitigate the effects of these vacant properties on Long Island, this is the way it would look. This is how state and local governments work together for the people of New York. The DFS bill, combined with HCR’s Community Restoration Fund will go a long way to improving the quality of life for many Long Islanders and revitalizing communities in Nassau and Suffolk counties.”

Executive Director of the Center for NYC Neighborhoods, Christie Peale said: "We commend the Governor and leaders in the state Legislature for brokering a deal that will help communities statewide to recover from the foreclosure crisis. With the Community Restoration Fund, policymakers will have a new tool to help homeowners at risk of foreclosure. And the reforms for tackling ‘zombie’ properties will also help to stabilize neighborhoods where derelict properties have proliferated in recent years. These are major victories for homeowners in New York.”

Executive Director of Home HeadQuarters, Kerry Quaglia said: “One abandoned property in disrepair can affect an entire block and they frustrate residents and visitors alike. These bills give us the tools we need to correct the problem of vacant homes and buildings that negatively impact our neighborhoods. I am grateful to Governor Cuomo for addressing the problem of zombie properties in Upstate New York.