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WHERE THE PROPERTY OWNER DIES INTESTATE, AND THE PLAINTIFF IS NOT SEEKING A DEFICIENCY JUDGMENT, THE FORECLOSURE ACTION MAY BE BROUGHT DIRECTLY AGAINST THE HEIRS OF THE PROPERTY OWNER; THE ESTATE IS NOT A NECESSARY PARTY (SECOND DEPT).

The Second Department, reversing Supreme Court, determined the foreclosure action against the heir of the decedent property owner should not have been dismissed. Where the property owner dies intestate, and plaintiff is not seeking a deficiency judgment, the foreclosure action can proceed directly against the heirs of the property owner. The estate is not a necessary party:

… [Where] “a property owner dies intestate, title to real property is automatically vested in his or her distributees” … . “Thus, where a mortgagor/property owner dies intestate and the mortgagee does not seek a deficiency judgment, generally a foreclosure action may be commenced directly against the distributees” … . Here, because the decedent died intestate, and because the plaintiff no longer seeks a deficiency judgment, the decedent’s estate was not a necessary party, and the plaintiff could proceed directly against the distributees of the decedent’s estate … . Deutsche Bank Natl. Trust Co. v Unknown Heirs to the Estate of Jacinto Ortiz, 2026 NY Slip Op 04745, Second Dept 7-29-26

Practice Point: Where the property owner dies intestate, and plaintiff is not seeking a deficiency judgment, the foreclosure action may proceed directly against the distributees, the estate is not a necessary party.

 

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