Stroock Special Bulletin
"Strategies for Multi-State Mortgage Foreclosure – New York Election of Remedies Statutes"
Foreclosing on multi-state "portfolio loans" – cross-collateralized and cross-defaulted loans secured by multiple properties in different jurisdictions – can pose unexpected problems for lenders when one of the mortgaged properties is in New York. The problems arise due to New York's "election of remedies" statute, which requires portfolio lenders with New York collateral to map out a careful foreclosure strategy or else risk losing the ability to foreclose on mortgaged property both in and outside New York and, in some circumstances, even the right to recover directly from borrowers and guarantors.
This Stroock Special Bulletin examines some of the foreclosure strategies that can help to avoid problems with New York’s election of remedies statute.