From the Decision
What the Court
ordered.
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Quick AnswerOn September 30, 2026, the United States District Court for the Southern District of New York entered judgment for Petroff Amshen's clients, two Bronx homeowners, after a one-day bench trial. The Court held the lender's foreclosure failed because his RPAPL 1306 filing with the New York Department of Financial Services listed a placeholder phone number, 9999999999, and omitted the owner who lives in the home. The Court also held the homeowners are entitled to their attorneys' fees under New York Real Property Law 282.
In November 2006, two men bought a house in the Bronx. One signed the $440,800 note. Both signed the mortgage. One of them still lives in the house today.
Over the years the mortgage was assigned from one holder to the next. Two foreclosure cases were filed against the house in Bronx County Supreme Court, one in 2017 and one in 2020. Neither succeeded. In January 2023, notices went out to both owners claiming the loan was $551,187.53 in default. On March 7, 2023, the mortgage was assigned to Edward Brown, an individual.
Brown sued in federal court on April 27, 2023, about seven weeks after he acquired the mortgage. He wanted a judgment of foreclosure and sale, a referee appointed to sell the house, and his own attorneys' fees on top of the debt.
New York requires a lender to do more than mail a 90-day warning before it sues. Under RPAPL 1306, it also has to file the borrower's name, address, last known phone number and the amount claimed with the Department of Financial Services within three business days of that mailing. New York's highest court has called this a condition precedent, meaning it has to be done before a foreclosure case can be brought.
The filing here went in on January 27, 2023. It named one owner as the only borrower. Where his phone number belonged, it said 9999999999. He testified at trial that had never been his number. The co-owner who actually lives in the house, named as a borrower on the mortgage, was left off entirely.
Judge Jessica G. L. Clarke tried the case without a jury on January 12, 2026. Brown testified for himself. Both of our clients took the stand. After trial, both sides filed post-trial briefs.
Brown's first move was to argue that the filing rule did not apply at all, because the owner who signed the note never made the house his main residence and so, in Brown's view, this was not a home loan. The Court rejected that. The co-owner is named as a borrower in the mortgage and lives in the house, and one borrower like that is enough. Stripping that protection from a borrower living in the home he bought would, the judge wrote, run counter to the legislature's intent.
His fallback was that the mistakes did not matter. He called the defense a hyper-technical reading of the statute and said our clients had to prove the errors hurt them. The Court found he cited no case law for that proposition. After reviewing decisions from New York's Second and Third Departments and from the federal courts, Judge Clarke held that the statute calls for strict compliance, and that includes a real last known phone number. The rule covers each lender, assignee or mortgage loan servicer, so a person who buys a mortgage is held to it the same as a bank.
Ultimately, Plaintiff's deficient Section 1306 filing dooms his case.Opinion and Order, September 30, 2026, at 20
From the Court's Opinion and Order, September 30, 2026.
The record, in order: what the law requires, what the filing said, and what the Court held on each argument.
RPAPL 1306 exists so the Department of Financial Services can track loans headed for foreclosure and send counseling resources where they are needed. The lender argued that purpose is administrative, so a bad phone number should not sink a case. The Court started where the Court of Appeals says to start: the text. The statute says the filing shall include the borrower's last known telephone number, and it says compliance is a condition precedent. A placeholder does not satisfy that text.
The Court surveyed the law. The Second Department (Goetz, Peralta, Nathan, Seminario) and the Third Department (Oz Leroy) require strict compliance with RPAPL 1306, and federal courts in New York (Windward Bora, Wilmington PT, Blue Castle, Bullock, Rossi) apply the same rule. Judge Clarke held the Court of Appeals would require strict compliance.
The lender's "not a home loan" argument turned on the co-owner who signed the note and lived in the house only intermittently. The Court looked at the statute's words: RPAPL 1304 protects the "borrower, or borrowers." The disjunctive "or" means the protection attaches to every borrower for whom the loan is a home loan. The co-owner who lives there is named as a borrower in the mortgage. Under Deutsche Bank v. Cincu, a homeowner named as a borrower in the mortgage is a borrower for RPAPL 1304 even without signing the note. The filing had to cover him, and it did not.
Mortgages almost always let the lender add its legal fees to the debt. New York Real Property Law 282 makes that a two-way street: when a mortgage on residential property lets the lender recover fees, a homeowner who successfully defends the foreclosure can recover theirs. The Court held our clients are the prevailing party and are entitled to fees. The amount is set on a separate motion.
An investor or company that bought the loan is held to the same rules as the bank that made it. Before a foreclosure can be brought in New York, the plaintiff must mail the 90-day notice and make the state filing with real information. A long default does not cure bad paperwork: this lender claimed the loan was 4,317 days behind, and his case still failed. And when the mortgage lets the lender charge its legal fees to the loan, New York law may let a homeowner who wins recover theirs.
None of this is automatic. It is found by reading the file, every notice, every filing, every assignment, and litigating what the file shows.
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