Legal Question in Real Estate Law in New York

Bring lawsuit to vacate lien.

Move bankruptcy court to avoid the lien. You already have no personal liability having been discharged in.bk. Liens on real property can last 20 years.

The applicable statute of limitation on a breach of contract is 6 years in New York. A mortgage default is a breach of contract, but because it involves periodic payments - monthly payments, a new breach occurs each time a payment is missed. Therefore, the statute of limitations in a mortgage case begins to run when the mortgage obligation is accelerated. That requires the bank to send you a Notice of Acceleration or commence a foreclosure action. In a foreclosure action the bank will demand payment of the entire outstanding principal balance thereby accelerating all future payments to the present. This is accomplished by stating, --the lender hereby elects to call the entire outstanding principal balance due, or words to that effect. Such a declaration fixes the statute of limitations to the date of the acceleration of the loan upon demanding a lump sum payment. Once the 6 years accrue from the date of acceleration without the bank commencing an action to foreclose or if an action is commenced and subsequently dismissed or withdrawn, without the bank recommencing the foreclosure action within the remaining balance of the 6 year period, the homeowner may seek to quiet title and sue to have the lien cancelled and discharged and to be free therefrom, unless the loan is "decelerated," meaning some form of reinstatement or payment or an affirmative action by the bank to retract the prior acceleration. in New York see RPAPL Article 15.

Now, if the second mortgage was discharged by a bankruptcy court because it was determined that there was insufficient equity in the home to collateralize the loan, then a quiet title action may be based upon the order discharging the loan, and a copy of the order must be presented as a basis for removing the lien from the property records in the office of the local county clerk. This may be accomplished by a reformation action seeking to reform the records of the county clerk to remove the lien.

I trust this answers your question.