Foreclosure Law

Acceleration Clauses in Foreclosure Actions: New Rules

, New York Law Journal

   | 4 Comments

In their Foreclosure Law column, Adam Leitman Bailey and Adam M. Swanson review recent case law and discuss some of the benefits and pitfalls when using an acceleration clause and how to overcome these obstacles.

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What's being said

  • Josh koplovitz

    See the decision of the Ulster County .Supreme Court in Wells Fargo v. machell which appears as a Decision of Interest in the Law Journal of March 28

  • B Ranjava

    Note, in your article, you state, "If the mortgage has been accelerated and is still within the six-year statute of limitations, the mortgagee may revoke acceleration so long as "there is no change in the borrower‘s position" in reliance on acceleration." This may be the case with conventional loans. However, a mortgagee cannot unilaterally decelerate if the loan is FHA. Pursuant to 24 CFR 201.50(c), HUD states, "The lender may rescind the acceleration of maturity after full payment is due and reinstate the loan ONLY if the borrower brings the loan current, executes a modification agreement, or agrees to an acceptable repayment plan. A mortgagee cannot willy nilly decelerate a FHA loan. Therefore, the mortgagee must be even more cautious with FHA. There are quite a few HUD regulations that will catch mortgagees off guard since most servicers have no idea what they are or that the regulations even exist.

  • B Ranjava

    Note, in your article, you state, "If the mortgage has been accelerated and is still within the six-year statute of limitations, the mortgagee may revoke acceleration so long as "there is no change in the borrower‘s position" in reliance on acceleration." This may be the case with conventional loans. However, a mortgagee cannot unilaterally decelerate if the loan is FHA. Pursuant to 24 CFR 201.50(c), HUD states, "The lender may rescind the acceleration of maturity after full payment is due and reinstate the loan ONLY if the borrower brings the loan current, executes a modification agreement, or agrees to an acceptable repayment plan. A mortgagee cannot willy nilly decelerate a FHA loan. Therefore, the mortgagee must be even more cautious with FHA. There are quite a few HUD regulations that will catch mortgagees off guard since most servicers have no idea what they are or that the regulations even exist.

  • B Ranjava

    Note, in your article, you state, "If the mortgage has been accelerated and is still within the six-year statute of limitations, the mortgagee may revoke acceleration so long as "there is no change in the borrower‘s position" in reliance on acceleration." This may be the case with conventional loans. However, a mortgagee cannot unilaterally decelerate if the loan is FHA. Pursuant to 24 CFR 201.50(c), HUD states, "The lender may rescind the acceleration of maturity after full payment is due and reinstate the loan ONLY if the borrower brings the loan current, executes a modification agreement, or agrees to an acceptable repayment plan. A mortgagee cannot willy nilly decelerate a FHA loan. Therefore, the mortgagee must be even more cautious with FHA. There are quite a few HUD regulations that will catch mortgagees off guard since most servicers have no idea what they are or that the regulations even exist.

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