A New York court’s reversal of Citimortgage’s foreclosure win sends a clear message: lenders can’t afford sloppy documentation in today’s market
Paperwork tripped up Citimortgage, Inc. this summer, as a New York appeals court reversed a foreclosure win after finding the lender’s records didn’t add up.
The story began in July 2013, when Citimortgage filed a foreclosure action against Mark and Danielle Rooney over a property in Patchogue, New York. The Rooneys answered the complaint and filed counterclaims, setting the stage for a long legal process. By August 2022, the Supreme Court in Suffolk County granted Citimortgage’s motion for summary judgment on the amended complaint and issued an order of reference, moving the case toward a foreclosure sale.
In August 2023, Citimortgage moved to confirm the referee’s report and for a judgment of foreclosure and sale. The Rooneys opposed the motion, arguing that Citimortgage had not provided clear evidence of the amounts due under the mortgage. The trial court reviewed the business records attached to an affidavit from Lauren Benning, an employee of the subservicer, but found the records insufficient. The court said the breakdown of the sums owed could not be determined from the documents provided. Rather than deny the motion outright, the court allowed Citimortgage to submit supplemental business records and gave the Rooneys an opportunity to respond.
After Citimortgage submitted the additional records, the Supreme Court granted the lender’s motion, confirmed the referee’s report, and directed the sale of the property. The Rooneys appealed both the January 2024 order and the subsequent order and judgment of foreclosure and sale.
On August 13, 2025, the Appellate Division, Second Department, reviewed the case. The appellate court noted that, generally, a plaintiff cannot satisfy its burden by submitting business records for the first time in reply papers. In this instance, the Rooneys were given a fair opportunity to respond, so there was no procedural prejudice. However, the appellate court found that even with the supplemental records, Citimortgage had not properly established the amounts due. The supplemental records were not identified or incorporated into the affidavit by someone with personal knowledge of Citimortgage’s record-keeping practices. Instead, they were attached as an exhibit to a letter from Citimortgage’s attorney, who did not claim such knowledge. As a result, the court determined that the referee’s findings on the amounts due were not substantially supported by the record.
The appellate court reversed the order and judgment of foreclosure and sale, denied Citimortgage’s motion to confirm the referee’s report, and sent the case back to the Supreme Court for a new report computing the amount due, followed by further proceedings.
For mortgage professionals, this case is a reminder that courts require clear, well-supported proof before approving a foreclosure. It’s not enough to submit a stack of records; those documents must be clearly connected to the loan, and someone with direct knowledge of the lender’s systems must vouch for them. Otherwise, even a case that seems straightforward can be sent back for more work.
Citimortgage, Inc. v Rooney demonstrates that in the mortgage business, attention to detail is essential. If you’re handling foreclosures, make sure your records are complete and properly presented. Otherwise, you could find yourself starting over, just like Citimortgage.
