By 2023, the court had appointed a referee to determine the amount due. The referee’s report came in May, and in July, Wells Fargo filed another notice of pendency before asking the court to confirm the report and approve the foreclosure sale. The defendants didn’t challenge the motion.
But the Supreme Court in Queens County denied Wells Fargo’s request. The judge ruled that the July 2023 notice was invalid because the previous notice had expired and Wells Fargo hadn’t requested an extension before it lapsed. The usual rule is that if a notice expires, you need to get an extension ahead of time or risk losing your place in the process.
Wells Fargo appealed, arguing that foreclosure cases are different. The bank pointed to a section of New York law that allows lenders to file a new notice of pendency in foreclosure actions even after a previous one expires, as long as it’s before the final judgment. The law is designed to ensure lenders can protect their interests throughout the often lengthy foreclosure process.
The appeals court agreed. It held that in foreclosure actions, lenders are allowed to file a new notice of pendency after a previous one has expired, provided it’s done before the final judgment and sale. The court reversed the lower court’s decision, allowing Wells Fargo to move forward with the foreclosure.
For mortgage professionals, this decision means less risk of having to restart a foreclosure if a notice of pendency expires. As long as a new notice is filed before the final judgment, the process can continue. The ruling removes some uncertainty from what can be a long and technical process.