Fannie Mae claims a Bronx multifamily owner defaulted on a big loan—now it’s asking the court to let it foreclose
Fannie Mae is moving to foreclose on a $2 million Bronx multifamily loan after the borrower allegedly missed payments and triggered default, court records show.
Filed on September 8, 2025, in the Southern District of New York, the complaint from the Federal National Mortgage Association—Fannie Mae—focuses on two apartment buildings at 702-704 Eagle Avenue in the Bronx. The case is a reminder that, even in a competitive market, missed payments can quickly escalate into a legal showdown.
Here’s what’s at issue: Fannie Mae says it holds the loan, originally issued on May 20, 2022, for $2,072,000, after an assignment from Arbor Commercial Funding I, LLC. The borrowers—Faigmay Holdings LLC and 702-704 Eagle Associates LLC—are alleged to have missed required monthly payments starting May 1, 2025. According to the complaint, this nonpayment constitutes an event of default under the loan documents.
But the story doesn’t end there. The complaint also points to a Restrictive Declaration granted by the borrowers to Israel Lichtenstein on or about March 14, 2023, and recorded March 21, 2023. Fannie Mae claims this move is a “Transfer” not permitted under the loan agreement, and thus another event of default. Because of these alleged defaults, Fannie Mae is seeking foreclosure of the property, a money judgment against the borrowers and guarantors, foreclosure of junior liens, and the appointment of a receiver to manage the property during the proceedings.
The case names a range of parties: the main borrowers, individual guarantors Yosef Grunwald and Yoel Grunwald, the New York City Environmental Control Board, Approved Oil Co. of Brooklyn, Inc., Israel Lichtenstein, and several unknown parties who may have subordinate interests or claims on the property. Fannie Mae asserts that any such interests are subordinate to its mortgage lien.
The numbers are clear. As of the filing, Fannie Mae claims the outstanding principal sum is $1,989,241.48, with accrued but unpaid interest, late charges, and other amounts to be determined. The complaint also details multiple junior encumbrances, including liens by Approved Oil Co. of Brooklyn, Inc., and fines and violations issued by the New York City Environmental Control Board. Fannie Mae is asking the court to foreclose these subordinate interests as part of the action.
For mortgage professionals, this case illustrates what can happen when commercial borrowers fall behind and lenders move to enforce their rights. It’s not just about missed payments; it’s about how quickly a loan can move from performing to default, and how many parties can become involved when a foreclosure action is filed.
At this stage, these are only Fannie Mae’s claims as set out in the complaint. The court has not yet ruled on the matter, and the outcome remains to be seen. Still, the case is a timely example of the risks and complexities that come with managing multifamily loans, especially when it comes to compliance and enforcement. For those in the business of lending, servicing, or investing in commercial mortgages, it’s a case worth following.
