Foreclosure Terminology
Glossary —
Buffalo NY

A provision in your mortgage allowing the lender to demand the full outstanding balance immediately when you default on payments. Once triggered, your lender can demand full payoff rather than just the missed payments. Most New York mortgages contain an acceleration clause — it’s what allows the foreclosure process to begin. Once accelerated, you typically cannot stop foreclosure by simply catching up on missed payments without also paying accumulated fees and legal costs.

A mortgage where the interest rate can change periodically based on a financial index. ARMs often start with a lower rate that resets after an initial fixed period (common terms: 3/1, 5/1, 7/1 — fixed for 3, 5, or 7 years then adjusting annually). In Western New York, ARM resets have been a common trigger for payment shock and subsequent foreclosure, particularly for mortgages originated in 2003–2008. If your Buffalo area home has an ARM, confirm your next reset date and current index.

A legal argument raised in response to a foreclosure complaint that challenges the lender’s right to foreclose. Common affirmative defenses in New York include lack of standing (lender cannot prove they own the note), failure to follow proper notice requirements, statute of limitations violations, and improper service. Affirmative defenses must be raised in your formal response to the foreclosure summons — a licensed NYS foreclosure attorney can evaluate which defenses may apply to your case.

The total amount of mortgage payments you have missed and not yet paid. Arrears include principal, interest, late fees, and any escrow shortfalls that have accumulated since your last payment. Your servicer’s “reinstatement quote” tells you the total amount needed to bring your loan current — this includes arrears plus all accumulated fees and legal costs. Arrears are distinct from your full payoff balance (which includes all future principal and interest).

A charge levied by a homeowners association for regular dues, special projects, or repairs. In WNY communities — particularly in Orchard Park, Amherst, Hamburg, Williamsville, and Clarence — unpaid HOA assessments can result in a lien on your property and HOA-initiated foreclosure, separate from your mortgage. Regular monthly dues are “regular assessments.” One-time charges for specific repairs (roof replacement, road repaving) are “special assessments.” Both carry lien and foreclosure authority. See our HOA Foreclosure guide.

The legal transfer of a mortgage from one lender or servicer to another. When your mortgage is sold or transferred, the new owner must record an assignment in Erie County or Niagara County records. Many foreclosure defenses in New York are based on the lender’s inability to prove a complete chain of assignments — meaning they cannot establish proper legal standing to foreclose. This is why lender identity matters and why a licensed NYS foreclosure attorney should review your chain of title if you’re considering a defense.

An immediate court order that halts all collection actions and foreclosure proceedings the moment a bankruptcy petition is filed. The automatic stay is one of the most powerful tools in bankruptcy — it stops the foreclosure clock, prevents Sheriff Sale, and pauses all creditor contact. In Chapter 13 bankruptcy, the automatic stay can remain in effect for years while you repay arrears through a court-supervised plan. Chapter 7 provides the stay only temporarily. See our Bankruptcy and Foreclosure guide.

A federal court process that discharges most unsecured debts. In foreclosure, Chapter 7 triggers an automatic stay that temporarily pauses proceedings — but does not eliminate the mortgage lien or save the home permanently. After Chapter 7, the lender can petition to lift the stay and proceed with foreclosure. Chapter 7 is most useful to Buffalo homeowners who want to eliminate other debts (credit cards, medical bills) and walk away from an underwater property without a deficiency judgment.

A federal court process that allows you to repay mortgage arrears over 3–5 years through a court-supervised repayment plan while keeping your home. Chapter 13 is the most effective bankruptcy tool for homeowners who want to save their Buffalo or WNY property — it allows you to cure the default over time while making regular current payments. Requires stable income sufficient to fund the repayment plan plus ongoing mortgage. See our full Bankruptcy and Foreclosure guide.

The person(s) who signed the promissory note and are legally obligated to repay the mortgage loan. All borrowers on the note are responsible for the debt and are named defendants in a foreclosure lawsuit. A co-borrower has equal responsibility — both parties’ credit and finances are affected by foreclosure. If only one co-borrower is involved in the foreclosure decision, both need to understand the consequences.

A formal written notice from your mortgage servicer advising you that you are in default on your mortgage and providing a deadline (typically 30 days) to cure the default before the lender accelerates the loan and begins foreclosure. Also called a “notice of default” or “demand letter.” In New York State, receipt of a breach letter is the first formal step — you still have time to negotiate a workout, apply for modification, or contact a HUD-approved housing counselor. The clock starts here.

An agreement where the lender or new owner of a foreclosed property offers money to the former homeowner in exchange for vacating the property quickly and leaving it in good condition. Cash for keys avoids the expense and delay of eviction proceedings. In Buffalo and WNY, cash for keys amounts typically range from $500–$5,000 depending on the property and situation. This option typically arises after the Sheriff Sale when the lender or new owner wants a clean possession.

A title that has unresolved liens, judgments, unpaid taxes, or other encumbrances that prevent a clean transfer of ownership. HOA liens, back tax liens, mechanics’ liens, IRS liens, and judgment liens all cloud title. A cash sale through Nickel City Buyers resolves all title issues at closing — we work with the title company to pay off every lien from the sale proceeds simultaneously. Homeowners do not need to resolve liens before the sale.

The formal legal document filed by the lender in New York Supreme Court to initiate a foreclosure lawsuit. The complaint identifies the parties, describes the loan, alleges default, and requests a judgment of foreclosure and sale. You will be served with the complaint along with a summons — this is what people mean by “foreclosure papers.” In New York, you typically have 20–30 days to respond to the complaint. See our Selling During Foreclosure guide.

The window of time after a breach notice during which a borrower can bring the loan current and stop foreclosure from proceeding. In New York, mortgage contracts typically provide a 30-day cure period after the breach letter. After the cure period expires, the lender can accelerate the loan and file the foreclosure complaint. Acting within the cure period provides the most options and the least cost — catching up at this stage avoids the legal fees that accumulate once the complaint is filed.

An agreement where the borrower voluntarily transfers ownership of the property to the lender in exchange for the lender agreeing not to pursue foreclosure. Avoids the public record of a Sheriff Sale. Requires lender approval — they must agree that a deed in lieu is preferable to foreclosure. Always require a written deficiency waiver as part of the agreement. New York State requires a 90-day listing period in many cases before a lender will accept a deed in lieu. See our full Deed in Lieu guide.

Failure to meet the terms of your mortgage agreement — most commonly missing one or more monthly payments. Other defaults include failing to maintain required insurance, failing to pay property taxes, or violating occupancy requirements. Technical default (non-payment) typically begins the foreclosure process. Monetary default is the most common — you are in default once a payment is missed and the grace period has passed. In New York, lenders typically wait 3–6 months of missed payments before filing a foreclosure complaint.

The gap between what you owe on your mortgage and what the property sells for in foreclosure, short sale, or deed in lieu. If you owe $175,000 and the home sells for $140,000, the deficiency is $35,000. In New York State, lenders can pursue a deficiency judgment for this balance — a court order requiring you to pay the remaining amount personally. New York uses fair market value (not just sale price) in deficiency calculations. See our full Deficiency Judgment guide.

A court order requiring the borrower to pay the remaining mortgage balance after a foreclosure sale — the amount owed minus the fair market value received. In New York, the lender has 90 days after the foreclosure sale to file for a deficiency judgment. If granted, they can garnish wages, levy bank accounts, and place liens on other property you own. A cash sale to Nickel City Buyers eliminates deficiency risk entirely because the proceeds pay the lender’s full payoff at closing. See our Deficiency Judgment guide.

The state of being behind on mortgage payments. Technically begins the day after a payment is due and unpaid past the grace period. 30-day delinquency is typically reported to credit bureaus. 90-day delinquency is usually when servicers become more aggressive with loss mitigation outreach. In New York, foreclosure complaints are typically filed after 3–6 months of delinquency. Early-stage delinquency (1–2 months) is the best window to contact a HUD-approved housing counselor or NCB for options.

A court order in bankruptcy that eliminates your personal liability for certain debts. A Chapter 7 discharge can eliminate personal liability for the mortgage deficiency — but it does not eliminate the mortgage lien on the property. The lender can still foreclose and take the property even after discharge. Discharge addresses the personal debt, not the lien. Understanding this distinction is critical: bankruptcy can protect you personally from deficiency judgment while still resulting in loss of the home.

The difference between your home’s current market value and the total amount you owe on all liens (mortgage, back taxes, HOA liens, other judgments). Positive equity means a cash sale may put money in your pocket. Many Buffalo and WNY homeowners facing foreclosure assume they have no equity — but WNY property values have increased significantly since 2013, and principal paydown adds equity over time. Call Nickel City Buyers at (716) 557-7005 for a free equity assessment before assuming a cash sale isn’t possible.

A portion of your monthly mortgage payment held by the servicer to pay property taxes and homeowner’s insurance on your behalf. If your property taxes or insurance costs increase, your escrow payment increases — which increases your total monthly payment. An “escrow shortage” or “escrow deficiency” can trigger additional payment demands. Failure to maintain required insurance is a technical default under most mortgage agreements.

A temporary agreement with your lender to pause or reduce mortgage payments for a set period — typically 3–12 months — due to financial hardship. Forbearance does not eliminate the missed payments; they must be repaid later through a lump sum or repayment plan. Forbearance is appropriate for short-term hardship. If your hardship is permanent, forbearance delays rather than solves the problem. Must be formally agreed to in writing by the lender — it is not automatic. See our Loan Modification guide.

New York is a judicial foreclosure state — meaning every foreclosure must go through the court system. The lender files a lawsuit, serves you with papers, the case proceeds through Supreme Court, a judgment is entered, a referee is appointed, and a Sheriff Sale is scheduled. This process typically takes 12–36 months in New York — significantly longer than non-judicial states. The extended timeline gives WNY homeowners more time and more options than most states allow.

The number of days after your payment due date during which you can pay without penalty or default classification. Most mortgage contracts provide a 15-day grace period — meaning if your payment is due on the 1st, you have until the 15th to pay without a late fee. After the grace period, late fees apply. After 30 days, the delinquency is typically reported to credit bureaus. Know your specific grace period from your mortgage note — it’s stated in the loan documents.

A written explanation to your lender describing why you are behind on mortgage payments and what circumstances caused the financial difficulty. Required for loan modification applications, short sale approvals, and deed in lieu requests. A well-written hardship letter documents the specific cause of hardship (job loss, medical emergency, divorce, death of co-borrower, natural disaster) and explains how your situation has changed or what your plan is going forward. Free HUD counselors can help draft effective hardship letters.

An organization within a planned community, condominium complex, or subdivision that enforces rules and collects dues from homeowners. In WNY suburbs — Orchard Park, Amherst, Hamburg, Williamsville, Grand Island, Clarence — HOAs are common. HOAs can place liens on your property for unpaid dues and initiate independent foreclosure proceedings. An HOA foreclosure can occur even if you are current on your mortgage. See our full HOA Foreclosure Buffalo NY guide.

The federal agency that certifies nonprofit housing counselors, provides FHA mortgage insurance, and administers housing assistance programs. HUD-approved housing counselors provide free foreclosure prevention counseling — they are paid through government and private grants, not by homeowners. Finding a HUD-approved counselor in Buffalo and WNY: hud.gov/findahousingcounselor. Also accessible via the HOPE Hotline: 1-888-388-4673.

The court order entered by the New York Supreme Court that formally authorizes the foreclosure sale of the property. After the judgment is entered, the court appoints a Referee who calculates the total amount owed and schedules the Sheriff Sale. Once a judgment of foreclosure and sale is entered, you can still sell the property — but you are now on a defined timeline toward auction. A cash sale to Nickel City Buyers can close after judgment is entered, paying off the judgment amount from proceeds.

A foreclosure process that must proceed through the court system — as required by New York State law. Every step requires court involvement: complaint filing, service, mandatory settlement conference, judgment, referee appointment, sale confirmation. This extends the New York timeline to 12–36 months in many Erie and Niagara County cases — significantly longer than non-judicial states. The extended timeline is a feature, not a bug: it gives WNY homeowners more time and more options.

Latin for “suit pending.” A public notice recorded in county records (Erie County Clerk or Niagara County Clerk) that a foreclosure lawsuit has been filed against the property. Once a Lis Pendens is recorded, it becomes part of the property’s public title record — anyone searching the title will see it. It does not mean foreclosure is complete; it means the lawsuit has begun. You can still sell the property after a Lis Pendens is recorded. Nickel City Buyers purchases properties with active Lis Pendens on file regularly.

A permanent change to the terms of your mortgage — such as a reduced interest rate, extended loan term, or in some cases principal reduction — designed to create a new monthly payment you can afford. Requires lender approval and typically takes 30–90 days. Lenders are not obligated to approve. Requires documentation of hardship and proof of ability to pay the modified amount. Not available for investment properties in most cases. See our full Loan Modification Buffalo NY guide.

The department within a mortgage servicer responsible for preventing or managing loan defaults — including forbearance, repayment plans, loan modifications, short sales, and deeds in lieu. When you are behind on your mortgage and want to discuss options, you should ask specifically for the “loss mitigation department” — not regular customer service. Always document every contact with loss mitigation: date, time, representative name, and what was discussed. Loss mitigation decisions can take weeks and follow-up is essential.

A New York State-specific requirement in residential foreclosure cases — the court mandates a conference between the homeowner and the lender’s attorney, supervised by a court official, to explore settlement options before the case proceeds. This is a critical difference between New York and most other states. Having an attorney or NY HOPP counselor represent you at this conference significantly improves outcomes. Free representation available through NY HOPP at housinghelpny.org. Missing this conference can result in default judgment.

The legal document you signed at closing where you personally promised to repay the loan. The note defines the interest rate, payment terms, and consequences of default. It is distinct from the mortgage (or deed of trust), which pledges the property as collateral. Your personal liability for the debt comes from the note — foreclosure deals with the collateral (the home), while deficiency judgments pursue the personal promise in the note. Lenders must produce the original note to foreclose in many cases — this is the basis of some foreclosure defenses.

A formal written notice from your mortgage servicer advising you that you are in default and identifying the amount needed to cure the default. In New York, this is typically called a breach letter or demand letter and precedes the filing of the foreclosure complaint. Receipt of a notice of default/breach letter is your earliest warning — and your widest window for options. Contact a HUD-approved housing counselor or Nickel City Buyers immediately upon receipt.

New York State’s primary foreclosure prevention program, providing free HUD-approved housing counselors and attorneys to homeowners facing foreclosure. NY HOPP counselors can negotiate with your lender, help with modification applications, and provide legal representation at New York State mandatory settlement conferences at no cost. Available to Erie and Niagara County homeowners. Contact: housinghelpny.org · 1-855-466-3456. See our full Government Programs guide.

A property used as the owner’s primary residence — as opposed to a rental, investment, or vacation property. Owner-occupied status is significant because most government foreclosure programs, loan modification options, and legal protections (including NY HOPP) are available only to owner-occupied primary residences. If you own a rental property in Buffalo that’s facing foreclosure, your options differ significantly from a homeowner facing foreclosure on their primary home. Nickel City Buyers purchases both — call (716) 557-7005.

The total amount required to fully pay off your mortgage loan on a specific date — including outstanding principal, accrued interest, prepayment penalties (if any), and any other fees. Your payoff amount changes daily as interest accrues. Request a payoff statement from your servicer and confirm the good-through date. In a cash sale, Nickel City Buyers works with the title company to obtain a payoff statement and pay the exact amount needed at closing to fully satisfy the lien.

The period after default but before the foreclosure complaint is filed — when you’ve missed payments and received breach notices but the court process has not yet begun. This is the most favorable window for homeowners: the most options, the lowest accumulated costs, and the most leverage with lenders. Selling during pre-foreclosure allows more time for marketing and negotiation. Nickel City Buyers can close during pre-foreclosure — call (716) 557-7005 the moment you receive a breach letter.

The original amount borrowed — not including interest. Your monthly mortgage payment consists of principal (reducing what you owe), interest (cost of the loan), and typically escrow (taxes and insurance). In early years of a mortgage, most of the payment goes toward interest — principal paydown accelerates as the loan matures. Understanding your current principal balance versus your home’s value tells you whether you have equity available in a cash sale scenario.

A court-appointed officer in New York State who calculates the total amount owed after a judgment of foreclosure and sale is entered and oversees the foreclosure auction process. The referee determines the payoff amount including principal, interest, fees, and legal costs, then publishes notice of the Sheriff Sale, conducts the auction, and reports the sale results back to the court. The referee’s calculation is the number that must be paid to stop the sale — contact Nickel City Buyers before the referee completes their report for maximum time.

The right of a homeowner to reclaim their property after foreclosure sale by paying the full amount owed plus costs. New York’s redemption rules differ from some other states — in New York’s judicial foreclosure process, the right of redemption generally expires when the judgment of foreclosure is confirmed. This means that once the Sheriff Sale is completed and confirmed by the court, the former owner typically cannot reclaim the property. Acting before the sale is essential — contact Nickel City Buyers at (716) 557-7005 if your sale date is approaching.

Bringing your mortgage loan fully current by paying all missed payments, late fees, and accumulated legal costs in a single lump sum payment. Reinstatement stops the foreclosure and restores the loan to its original terms. In New York, the right to reinstate typically exists up until the foreclosure judgment is entered. The reinstatement amount (“reinstatement quote”) includes all arrears plus every fee the servicer has charged — get a written quote with a good-through date before paying anything.

An agreement with your lender to spread past-due payments over several months — added on top of your regular monthly payment — until the arrears are repaid. If you missed 4 payments at $1,100/month ($4,400 total) and get a 12-month repayment plan, your lender adds approximately $367 to each of your next 12 payments. Repayment plans only work if you can genuinely afford your regular payment plus the extra catch-up amount. See our Loan Modification guide.

The public auction of a foreclosed property in New York State, conducted by the county sheriff after a judgment of foreclosure and sale is entered. In Erie County, Sheriff Sales are held at 92 Franklin St, Buffalo NY. In Niagara County, at 175 Hawley St, Lockport NY. The property goes to the highest bidder — the lender often submits a credit bid equal to what they’re owed. Once the gavel falls and the sale is confirmed, the former owner’s right to the property is gone. A cash sale to Nickel City Buyers can close right up to the auction date.

A sale in which the lender agrees to accept less than the full payoff amount — allowing the property to sell for current market value even though it is less than what is owed. Requires lender pre-approval, typically takes 60–120 days for approval, and requires proof of hardship. Always negotiate a written deficiency waiver as part of the short sale approval. Not the same as a cash sale — a short sale still requires finding a buyer, listing the property, and waiting for lender approval. See our Short Sale vs Foreclosure guide.

The company that manages your mortgage account — collecting payments, maintaining escrow, handling customer service, and managing loss mitigation. Your loan servicer may be different from the original lender and may change over time through mortgage servicing transfers. When you are behind on payments, your servicer’s loss mitigation department is your primary contact. Always ask for the loss mitigation department by name — not general customer service.

The legal document served along with the foreclosure complaint that officially notifies you a lawsuit has been filed and provides the deadline to respond. In New York, you typically have 20 days to respond if served personally or 30 days if served by other methods. Receiving a foreclosure summons does not mean you will lose your home — it means the court process has begun. Do not ignore it. Contact NY HOPP (housinghelpny.org), Neighborhood Legal Services (nls.org), or Nickel City Buyers at (716) 557-7005 immediately.

A review of public county records to identify all liens, encumbrances, and ownership history associated with a property. Performed before any sale or refinance. A title search reveals mortgage liens, back tax liens, HOA liens, judgment liens, IRS liens, mechanic’s liens, and any other claims against the property. In a cash sale through Nickel City Buyers, our title company conducts a full title search and resolves all liens from the sale proceeds at closing — the seller does not need to resolve liens before the sale.

A property where the total amount owed on all liens exceeds the current market value. If you owe $200,000 and the home is worth $165,000, you are $35,000 underwater. Underwater homeowners cannot sell through a traditional listing without bringing cash to closing — unless the lender approves a short sale. Many Buffalo and WNY homeowners believe they are underwater when they are not — WNY values have increased since 2013. Call (716) 557-7005 for a free equity assessment before assuming underwater status.

A foreclosed or at-risk property where the owner has moved out before the process is complete. Voluntarily vacating does not eliminate your legal or financial obligations. You remain liable for the mortgage, taxes, HOA dues, and any code violations until title is legally transferred. In Buffalo and Erie County, vacant properties accumulate code violation notices quickly — which become liens that reduce net proceeds or complicate sale. Call Nickel City Buyers before vacating to understand your exposure.

A broad term for any negotiated resolution between borrower and lender to avoid foreclosure — including forbearance agreements, repayment plans, loan modifications, short sales, and deeds in lieu. Workout agreements require lender cooperation and written documentation. The success rate of workout agreements varies by servicer and loan type. HUD-approved counselors and NY HOPP attorneys are highly effective at facilitating workout negotiations. A cash sale to Nickel City Buyers is an alternative workout — one that doesn’t require lender approval or a lengthy negotiation process.