§ 94 — Foreclosure

§ 94. Foreclosure. 1. In any foreclosure action the commissioner, and\nthe municipality if it has made a loan to the housing company, in\naddition to other necessary parties, shall be made parties defendant;\nand the commissioner and the municipality shall take all steps in such\naction necessary to protect the interest of the public therein, and no\ncosts shall be awarded against him or the municipality. Foreclosure\nshall not be decreed unless the court to which application therefor is\nmade shall be satisfied that the interests of the lienholder or holders\ncan not be adequately secured or safeguarded except by the sale of the\nproperty. In any such proceeding, the court shall be authorized to make\nan order increasing the rentals to be charged for the housing\naccommodations in the project involved in such foreclosure, but not\nexceeding the maximum average rentals fixed herein, or appoint the\ncommissioner as a receiver of the property and in the event the\nmunicipality has made a loan to the housing company, appoint an officer\nor employee of the municipality, or grant such other and further relief\nas may be reasonable and proper. In the event of a foreclosure sale or\nother judicial sale, the property shall, except as provided in the next\nsucceeding paragraph of this section, be sold only to a housing company,\nunless the court shall find that the interest on the bonds cannot be\nearned under the restrictions imposed by the provisions of this article\nand that the proceeding was brought in good faith. In such event the\nproperty shall be sold free of all restrictions imposed by this article\nand all the benefits theretofore granted under this article to such\nproject shall thereupon terminate.\n 2. Notwithstanding the foregoing provisions of this section, wherever\nit shall appear that a government, the New York state housing finance\nagency, the New York state urban development corporation, created by the\nNew York state urban development corporation act, the New York city\nhousing development corporation, Battery Park city authority, an\norganization or entity investing or participating in a loan pursuant to\nsubdivision one of section fifteen of this chapter, or a corporation\nsubject to the supervision of the state department of financial\nservices, shall have loaned on a mortgage which is a lien upon any such\nproperty, such government, New York state housing finance agency, New\nYork state urban development corporation, New York city housing\ndevelopment corporation, Battery Park city authority, an organization or\nentity investing or participating in a loan pursuant to said section\nfifteen or a corporation subject to such supervision, or any trustee or\ntrustees, or any successor trustee or trustees, for the benefit of any\none or more of the aforesaid classes shall have all the remedies\navailable to a mortgagee under the laws of the state of New York, free\nfrom any restrictions contained in this section except that the\ncommissioner shall be made a party defendant and that the commissioner\nshall take all steps necessary to protect the interests of the public\nand no costs shall be awarded against him or her\n