You are here: / / THERE WAS A SURPLUS AFTER THE FORECLOSURE SALE OF DEFENDANT’S PROPERTY;...
, ,

THERE WAS A SURPLUS AFTER THE FORECLOSURE SALE OF DEFENDANT’S PROPERTY; DEFENDANT HAD ENTERED A HOME EQUITY LINE OF CREDIT WITH CITIBANK; CITIBANK, NOT DEFENDANT, WAS ENTITLED TO THE SURPLUS FUNDS (SECOND DEPT).

The Second Department, reversing Supreme Court, determined the defendant, owner of the equity of redemption after a foreclosure sale of defendant’s property, was not entitled to the surplus funds after the sale. Defendant had entered a home equity line of credit with Citibank. Citibank was entitled to the surplus funds:

“‘[S]urplus money proceedings . . . are not collateral to the foreclosure, but are in the action itself[,] [a]nd the rights of lienors subsequent to the mortgage under foreclosure are before the court and must be protected as much as those of the owner of the property'” … . “‘Surplus money from a foreclosure sale is not a general asset of the owner of the equity of redemption, but stands in the place of the property for the purpose of distribution among those having vested interests in or liens on the property. The rights of the parties are fixed at the time of the foreclosure sale, and the rights of a second lienholder are transferred to any surplus'” … . “Under New York law, the lien of a junior mortgagee who is made a party to a foreclosure action brought by a senior mortgagee, although cut-off and extinguished as to the land, continues as a lien upon the surplus funds arising from the foreclosure” … . “‘[U]pon the foreclosure of the first mortgage, the lien of the second mortgage follow[s] the surplus into the hands of the [municipality’s] financial officer, and the remedy of the second mortgagee is to enforce his or her claim in the court by whose direction the foreclosure had taken place'” … . Maspeth Fed. Sav. & Loan Assn. v O’Connell, 2023 NY Slip Op 06037, Second Dept 11-22-23

Practice Point: In addition to the mortgage which was foreclosed, defendant property-owner had entered a home equity line of credit with Citibank. There were surplus funds after the foreclosure sale. Citibank, not defendant, was entitled to the surplus funds.

 

You might also like
Law School Properly Rescinded Student’s Application for Admission Based Upon Omissions Concerning Criminal Record
PLAINTIFF WAS INJURED WHEN THE ARM AND FOOT PEDAL OF AN ELLIPTICAL MACHINE AT DEFENDANT’S GYM BROKE OFF; DEFENDANT DID NOT DEMONSTRATE A LACK OF CONSTRUCTIVE NOTICE OF THE DEFECT OR THE APPLICABILITY OF THE ASSUMPTION OF THE RISK DOCTRINE (SECOND DEPT).
A HEARING IS NECESSARY TO DETERMINE WHETHER SERVICE OF THE SUMMONS AND COMPLAINT ON THE DOORMAN OF DEFENDANT’S APARTMENT BUILDING WAS VALID (SECOND DEPT).
Analytical Criteria for a Motion to Dismiss for Failure to State a Cause of Action Where Plaintiff Submits an Affidavit/Analytical Criteria for a Motion to Amend the Complaint
A CONVICTION BY GUILTY PLEA MAY BE SET ASIDE ON ACTUAL INNOCENCE GROUNDS, DEFENDANT ENTITLED TO A HEARING ON HER ACTUAL INNOCENCE CLAIM AND ON HER INEFFECTIVE ASSISTANCE CLAIM.
Purported Lack of Standing Is Not a Jurisdictional Defect/Sua Sponte Dismissal of Complaint Reversed
UNDER THE CIRCUMSTANCES, SUPREME COURT SHOULD HAVE GRANTED THE DEFENSE AND PROSECUTION’S JOINT REQUEST TO HAVE THE DEFENDANT’S COMPETENCE TO STAND TRIAL EVALUATED; ONCE A DEFENDANT IS DEEMED COMPETENT TO STAND TRIAL, THE DECISION WHETHER TO PRESENT AN INSANITY DEFENSE IS THE DEFENDANT’S, NOT THE COURT’S, TO MAKE (SECOND DEPT).
IN THIS VEHICLE ACCIDENT CASE, PLAINTIFF ENTERED AN ARBITRATION AGREEMENT WHICH INDICATED THE AWARD WOULD BE BETWEEN $0 AND $50,000, BUT THE POLICY LIMITS WERE $100,000/300,000; THE UNILATERAL MISTAKE BY PLAINTIFF’S ATTORNEY RE: THE POLICY LIMITS WAS NOT INDUCED BY DEFENDANT OR DEFENDANT’S CARRIER, THEREFORE RESCISSION OF THE AGREEMENT WAS NOT AN AVAILABLE REMEDY (SECOND DEPT).

Categories

Sign Up for the Mailing List to Be Notified When the Site Is Updated.

  • This field is for validation purposes and should be left unchanged.

Copyright © 2026 New York Appellate Digest, Inc.
Site by CurlyHost | Privacy Policy

PLAINTIFF DID NOT DEMONSTRATE THE RELEASE WAS PROCURED BY FRAUD, CRITERIA EXPLAINED... FATHER IGNORED COMPULSORY DISCOVERY OF HIS FINANCIAL ABILITY TO PAY SUPPORT;...