Nationstar’s team thought they could rely on New York’s so-called “savings provision,” a rule that sometimes gives lenders a six-month window to restart a case after it’s been dismissed. But the courts saw it differently. The Supreme Court in Nassau County sided with Oliveri, and when Nationstar appealed, the appellate judges agreed.
The big reason? The Foreclosure Abuse Prevention Act, or FAPA, which kicked in at the end of 2022. This law was designed to crack down on drawn-out foreclosure cases and make sure lenders move quickly. Under FAPA, if a foreclosure is dismissed because the lender didn’t act, that’s it – no do-overs, no second chances through the old six-month rule.
The judges made it clear: FAPA means what it says. If a lender lets a foreclosure case stall and it gets dismissed for inactivity, they can’t come back later and try again using the savings provision. That’s a big shift from how things used to work, and it puts the pressure on lenders and servicers to keep their cases moving.
This decision is a wake-up call. If you’re handling foreclosures in New York, you need to be on top of your timelines. Missing a deadline or letting a case sit too long could mean losing the right to foreclose altogether. There’s no safety net anymore.
The court also brushed aside arguments that FAPA shouldn’t apply retroactively or that it was unconstitutional. In short, the law stands, and lenders need to adjust.