- June 22, 1995
- New York State Counsel, Managers and Agents
- HUD Nonjudicial Mortgage Foreclosures
The Stewart Title National Legal Department has issued a bulletin relating to the captioned topic. Please see bulletin NL000049 HUD Nonjudicial Mortgage Foreclosure. The National bulletin contains guidelines for underwriting HUD Multifamily nonjudicial mortgage foreclosures. Reference is also made in the national bulletin to the HUD Single Family Mortgage Foreclosure Act of 1994.
Please note that the underwriting guidelines in the attached bulletin are for the HUD multifamily foreclosure only. Do not underwrite a single family HUD non-judicial mortgage foreclosure until after national underwriting guidelines are set.
Article 14 of the Real Property Actions and Proceedings Law (RPAPL) is the New York statute for foreclosure by advertisement. This statute is rarely used. If HUD elects to make use of the New York non-judicial procedure for foreclosure by advertisement, Counsel must be consulted.
A summary of the Multifamily Mortgage Foreclosure Act of 1981 is found in Volume 1 of the (National) Stewart Title Underwriting Manual (STUM), under the topic FEDERAL FORECLOSURE ACT (§6.00 et seq.). The issuance of NL000049 overrides the advice in the last paragraph of STUM §6.00.01, which states "Do not insure under this foreclosure act without approval from the National Legal Department".
The "standard 25 day notice" to the IRS to foreclose a subordinate federal tax lien, referred to in the bulletin, is discussed in full in STUM under the topic FEDERAL TAX LIENS, at §6.08.9.3, and a sample form of notice is found in §6.08.9.4. Please note that, where the proper notice has not been given, the lien remains and must be excepted, and where the proper notice has been given, the exception relating to the 120 days redemption right of the federal government must still be raised.
The 25 day notice is given to the District Director of the district where
the sale is being conducted. Please refer to the Underwriting Manual article
for more complete information.
THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.