Citibank Failed to Timely Submit Mortgage Satisfaction Notices in New York, Class Action Claims

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A proposed class action alleges Citibank has unlawfully failed to timely present to county clerks in New York proof that mortgages have been satisfied. 

The Yonkers, New York resident behind the 12-page case claims Citibank has run afoul of the state’s Real Property Law and Real Property Actions and Proceedings Law by failing to present a certificate of discharge for recording within 30 days of the date upon which he paid the full amount of principal and interest on his mortgage.  

The case alleges the plaintiff has incurred expenses, including attorney’s fees, to compel Citibank to execute and file a satisfaction of mortgage notice with New York in October 2021. According to the case, the plaintiff remitted the principal of more than $200,000 for his mortgage to Citibank in November 1999. 

“The New York Legislature has determined that failure by mortgagees, such as Citibank to clear and quiet titles within the deadlines required by [law] caused both tangible and intangible, actual, concrete and injuries to aggrieved mortgagors like plaintiff and the Class,” the suit says. “The failure to timely present a mortgage satisfaction can also frustrate landowners who need a marketable title to complete a property sale.

The lawsuit says New York law affords statutory damages of $500 after 30 days, $1,000 after 60 days, and $1,500 after 90 days of a mortgagee failing to present a mortgage satisfaction notice to the relevant county clerk. 

“Upon information and belief, Citibank has failed to timely file mortgage satisfactions in thousands of instances throughout New York State, resulting in class wide violations of the [Real Property Law] and [Real Property Actions and Proceedings Law],” the filing alleges. 

The case contests that Citibank’s conduct can both “create a cloud on title” to real estate owned by New York residents and damage a person’s reputation and credit by creating the false appearance that they have not paid their debt, which may make it difficult for them to obtain financing in the future. 

The lawsuit looks to represent: 

“All persons who were the mortgagor party to a mortgage for which Citibank was a mortgagee/assignee/ successor in interest that was secured by real property located in New York State and for which the authorized principal, interest and any other amounts due or otherwise owed by law was actually made or discharged after January 1, 2006, but Citibank failed to present a certificate of discharge or satisfaction of mortgage within thirty (30) days to the recording officer of the county in New York where the mortgage was recorded.” 

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