Second Department Finds Factual Issues Regarding the Applicability of RPAPL 1304 and Refuses to Expunge an Erroneously Recorded Satisfaction of Mortgage
Print Article- Posted on: Jun 20 2025
This BLOG frequently writes about mortgage foreclosure, generally, and RPAPL 1304, specifically.[1] By way of brief background, and as addressed in numerous prior BLOG articles, the Second Department has stated that an “RPAPL 1304 notice is a notice pursuant to the Home Equity Theft Prevention Act (Real Property Law § 265-a), the underlying purpose of which is to afford greater protections to homeowners confronted with foreclosure.” Wells Fargo Bank, N.A. v. Yapkowitz, 199 A.D.3d 126, 131 (2nd Dep’t 2021) (some citations and internal quotation marks omitted; hyperlink added). The Yapkowitz Court continued, noting that “RPAPL 1304 requires that at least 90 days before a lender, an assignee, or a mortgage loan servicer commences an action to foreclose the mortgage on a home loan as defined in the statute, such lender, assignee, or mortgage loan servicer must give notice to the borrower.” Id. (citations and internal quotation marks omitted, emphasis added). “Further, the legislative history noted a typical lack of communication between distressed homeowners and their lenders prior to the commencement of litigation and the bill sponsor sought ‘to bridge that communication gap in order to facilitate a resolution that avoids foreclosure’ by providing [the] preforeclosure notice … and an ‘additional period of time … to work on a resolution.’” Id. (some citations, internal quotation marks and brackets omitted) (quoting Senate Introducer’s Mem in Support, Bill Jacket, L 2008, ch 472 at 10).
The failure of the “lender, assignee or mortgage loan servicer” to comply with RPAPL § 1304 will result in the dismissal of a foreclosure complaint (see, e.g., U.S. Bank N.A. v. Beymer, 161 A.D.3d 543, 544 (1st Dep’t 2018)) when the issue is raised by the borrower (see, e.g., One West Bank, FSB v. Rosenberg, 189 A.D.3d 1600, 1602-3 (2nd Dep’t 2020) (citation omitted)). A foreclosing lender must be in “strict compliance” with the requirements of RPAPL 1304. U.S. Bank Nat. Ass’n v. 22-23 Brookhaven, Inc., 219 A.D.3d 657, 664 (2nd Dep’t 2023). Indeed, “proper service of the notice containing the statutorily mandated content is a condition precedent to the commencement of a foreclosure action.” U.S. Bank N.A. v. Taormina, 187 A.D.3d 1095, 1096 (2nd Dep’t 2020) (citations omitted).
To establish entitlement to judgment as a matter of law in an action to foreclose a mortgage, a plaintiff must produce the mortgage, the unpaid note, and evidence of default. Deutsche Bank Nat. Trust Co. v. Crosby, 201 A.D.3d 878, 880 (2nd Dep’t 2022) (citations omitted). When failure to comply with RPAPL § 1304 is raised, the plaintiff must demonstrate its “strict compliance” with the statute as part of its prima facie case. Pennymac Corp. v. Levy, 207 A.D.3d 735, 736 (2nd Dep’t 2022); see also Bank of America, Nat. Ass’n v. Wheatly, 158 A.D.3d 736 (2nd Dep’t 2018); Yapkowitz, 199 A.D.3d at 131. Thus, the proper service of a notice under RPAPL 1304 “on the borrower or borrowers is a condition precedent to the commencement of a foreclosure action, and the plaintiff has the burden of establishing satisfaction of this condition.” Wilmington Savings Fund Society, FSB v. Kutch, 202 A.D.3d 1030, 1032 (2nd Dep’t 2022) (citations and internal quotation marks omitted).
On June 18, 2025, the Appellate Division, Second Department, decided Bank of America, N.A. v. Reed, a mortgage foreclosure action addressing RPAPL 1304 and other interesting issues. The facts of Reed, as relevant to this article, are as follows. In 2003, the borrower obtained a $200,000 home equity line of credit and secured his repayment obligation with a mortgage on real property in Queens, New York. Despite his alleged payment default in January of 2014, in April of 2014, the lender recorded a “satisfaction of mortgage in favor of [the borrower] indicating that the mortgage had been satisfied and discharged.” In 2016, the lender commenced an action against the borrower to foreclosure the mortgage and to expunge the satisfaction of mortgage. The Motion court denied the parties’ motions for summary judgment and appeals followed.
RPAPL 1304
After discussing case law along the lines discussed herein, the Second Department noted that the lender can overcome an RPAPL 1304 defense by demonstrating “strict compliance” with the statute or, alternatively, the Court stated, the lender “bears the burden of establishing, prima facie, that RPAPL 1304 is inapplicable and, therefore, that the loan is not subject to the notice requirements set forth in the statute.” (Citations, internal quotation marks and brackets omitted.) The Court found that the lender failed to demonstrate RPAPL 1304 was inapplicable and that the borrower failed to demonstrate that RPAPL 1304 was applicable. As to the lender, the Court stated:
The [lender] failed to establish, prima facie, that the subject loan was not a “home loan” and, thus, was not subject to the notice requirements of RPAPL 1304. In support of its motion, the plaintiff submitted, inter alia, a copy of the [home equity line of credit] agreement executed by [the borrower] in 2003, which listed the premises as his address. The [lender] otherwise failed to submit evidence demonstrating that [the borrower] did not use the premises as his principal dwelling at the time [the borrower] signed the [home equity line of credit] agreement or thereafter. Contrary to the [lender]’s contention, its submissions failed to demonstrate that the premises were not [the borrower]’s principal dwelling at the time this action was commenced. Even if its submissions had so established, the [lender] would not have been relieved of the obligation to serve [the borrower] with the RPAPL 1304 notice prior to commencing this. [Citations omitted.]
As to the borrower’s argument on the applicability of RPAPL 1304 (and the lender’s counterargument), the Court stated:
In support of that branch of [the borrower’s] cross-motion, the [borrower] asserted that RPAPL 1304 was applicable and that dismissal was warranted due to the [lender]’s failure to serve [the borrower] with the statutory notice prior to commencing this action. The [borrower] established [his] prima facie entitlement to judgment as a matter of law on this ground, among other things, by submitting the [home equity line of credit] agreement and an affidavit … wherein he averred that “the [p]remises [were his] home and primary residence from 1971 until 2021”. In opposition, however, the [lender] raised a triable issue of fact as to whether RPAPL 1304 was inapplicable by submitting, inter alia, documents from 2013 through 2019 listing a property in Harlem as [the borrower]’s address and an affidavit from [the borrower] executed in 2013 in an unrelated action wherein he averred that he had “been a member of the Harlem community for over sixty-five (65) years.” [Citations, internal quotation marks and brackets omitted.]
Expungement of the Satisfaction
The Court also found that the lender failed to demonstrate its entitlement to have the satisfaction of mortgage expunged and, in so doing, stated:
In the complaint, the [lender] alleged that its filing of the satisfaction of mortgage “was erroneous and inadvertent.” In support of its motion, the [lender] submitted, among other things, an affidavit from its authorized representative that failed to address the satisfaction of mortgage and to demonstrate that the filing thereof was erroneous and inadvertent. Contrary to the [lender]’s contention, the fact “that the mortgage had not been paid,” standing alone, was insufficient to satisfy the [lender]’s prima facie burden. Since a [lender] cannot foreclose on a satisfied mortgage, the [lender] also failed to meet its prima facie burden on those branches of its motion which were for summary judgment on the complaint insofar as asserted against [the borrower] and for an order of reference.
Jonathan H. Freiberger is a partner and co-founder of Freiberger Haber LLP.
This article is for informational purposes and is not intended to be and should not be taken as legal advice.
[1] This BLOG has written numerous articles addressing various issues related to RPAPL 1304. To find articles related to RPAPL 1304, please see the BLOG tile on our website and type “RPAPL 1304” into the “search” box. If you are interested in BLOG articles related to other mortgage foreclosure issues, see the BLOG tile on our website and search for any other topics of interest.
