What is the Foreclosure Abuse Prevention Act?
The Foreclosure Abuse Prevention Act (FAPA) is a 2022 New York law that restricts when lenders can accelerate loans in foreclosure and closes statutory limitations gaps that previously allowed lenders to restart the clock on claims.
New York enacted the Foreclosure Abuse Prevention Act in 2022 to tighten the rules around loan acceleration and the statute of limitations in residential foreclosure cases. The law directly addresses practices that had allowed lenders to avoid time-based dismissals of claims by artificially resetting the statute of limitations through repeated demand letters or other procedural maneuvers.
Under FAPA, lenders face stricter requirements for when and how they can accelerate a loan (demand the full balance become due immediately). The law also closes the de-acceleration loophole, which previously allowed lenders to withdraw an acceleration notice and then restart it, effectively resetting the legal clock on time-barred claims. This change prevents lenders from indefinitely extending their right to pursue foreclosure by repeatedly stopping and restarting acceleration.
The statute also clarifies that once a reasonable time passes after a lender fails to move forward with foreclosure, the claim becomes stale. These protections particularly matter for borrowers in the Hempstead Metro area who have faced extended foreclosure timelines or repeatedly received demand notices without meaningful collection action.
For homeowners facing foreclosure, understanding FAPA is important because it sets legal boundaries on what lenders can do. Foreclosure defense attorneys use these protections to challenge improper acceleration notices and to argue that lenders have lost the right to foreclose due to statute of limitations violations.