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66 POST-EEFPA ASSISTANCE AVAILABLE FOR BORROWERS AND TENANTS Despite the expiration of the hardship stays under the EEFPA, financial assistance is available for both homeowners and tenants who were financially affected by the COVID-19 pandemic. In December 2021, Governor Hochul announced the creation of a $539 million fund to help assist homeowners facing foreclosure. New York's Homeowner Assistance Fund (NYHAF) aims to assist homeowners who are behind at least 30 days on their mortgage payments, property taxes, condo fees, or co-op fees. e application process opened on January 3, 2022, and applications were accepted on a first-come, first-served basis for a period of 30 days. e application process for NYHAF is currently closed, but a waiting list has been established for interested applicants. Under NYHAF, the property that secures the borrower's delinquent mortgage must be the borrower's primary residence and the borrower's income cannot exceed the average household median income for the county in which the property is situated. Qualified borrowers may be eligible for a five-year forgivable grant up to a maximum of $50,000 that can be used for both delinquent and future housing payments. For tenants, the COVID Emergency Rental Assistance Program (ERAP) started taking applications for rental assistance on June 1, 2021. ERAP was projected to provide up to $2.7 billion in emergency assistance to tenants impacted by the pandemic. As of this writing, funding under ERAP has been exhausted in most of the counties in New York, with the exception of Nassau and Suffolk counties. Tenants approved under ERAP could receive up to 12 months of rental arrears payments, up to three months of additional rental assistance, or up to 12 months of utility arrears payments. Funds for approved applications are paid directly to the landlord or utility company on the tenant's behalf. STAYS AVAILABLE DURING APPLICATION REVIEW As noted by Chief Administrative Judge Lawrence P. Marks in his January 17, 2022, foreclosure and eviction memorandums, homeowners and tenants may still be entitled to a stay of proceedings while applications submitted under NYHAF and ERAP are pending review. In foreclosure proceedings, we expect homeowners with pending NYHAF applications to request continuations of settlement conferences or adjournments of pending motions. As with foreclosures, there is still protection in place for tenants facing eviction under the Tenant Safe Harbor Act (TSHA) ERAP so long as the tenant meets the requirements thereunder. As described in Administrative Order 34/22, the TSHA extends the moratorium on evictions of residential tenants with a COVID-19-related hardship during the "COVID-19 covered period," which ran from March 7, 2020, until January 15, 2022. Under the TSHA, "no court shall issue a warrant of eviction or other possessory judgment against a residential tenant that has suffered a financial hardship during the COVID-19 covered period for non-payment of rent." A tenant may raise financial hardship under the covered period as an affirmative defense in any summary proceeding under Article 7 of the Real Property Actions and Procedures Law (RPAPL) dealing with repossession. Under the TSHA, a court may further award a money judgment for the rent due and owed to a successful petitioner in a RPAPL Article 7 summary proceeding. ERAP also remains in effect despite expiration of the EEFPA, and eviction matters with pending ERAP applications continue to be stayed until a final determination of eligibility for rental assistance is issued by the Office of Temporary and Disability Assistance (OTDA), including exhaustion of the appeals process. ERAP requires landlords to submit notice of a known ERAP application to the court where the eviction proceeding is pending in accordance with prior Administrative Order 244/21. Lenders and landlords can challenge individual requests for stays under NYHAF and ERAP, as not all cases will be entitled to a stay. Whether an individual is entitled to a stay under NYHAF or ERAP is highly fact specific. For example, a stay under ERAP should not apply to holdover (non-payment) proceedings, such as post-foreclosure eviction proceedings, where no landlord-tenant relationship exists. Similarly, ERAP does not apply if a tenant intentionally causes damage to the property or persistently and unreasonably engages in objectionable or nuisance behavior. WHAT'S NEXT? While both foreclosure and eviction proceedings are now allowed to proceed, continuing delays are expected based upon the sheer volume of active cases pending before the courts. At a brown bag conference held earlier this month, some state court judges reported more than 2,600 active matters pending before their part. Because many foreclosure and eviction matters have been stayed or stagnant since the beginning of the COVID-19 pandemic, foreclosure counsel should be proactive and diligent in getting matters back on the courts' active calendars, requesting that aged motions be decided, and getting conferences scheduled so that foreclosure and eviction actions can proceed. In moving these matters forward, mortgage servicers should be aware of recent significant changes in the applicable case law while the pandemic hardship stays were in Feature By: Mikelle V. Bliss and Margaret J. Cascino Lenders and landlords can challenge individual requests for stays under NYHAF and ERAP, as not all cases will be entitled to a stay.

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