On June 15, 2022, the Second Department issued a decision in U.S. Bank N.A. v. Kahn Prop. Owner, LLC, 2022 NY Slip Op. 03921, holding that a loan servicer’s affidavit without supporting business records was insufficient to prove a borrower’s failure to pay, explaining:
To establish prima facie entitlement to judgment as a matter of law in a foreclosure action, a plaintiff must produce the mortgage, the unpaid note, and evidence of the default. The plaintiff has the burden of establishing, by evidence in admissible form, its prima facie entitlement to judgment as a matter of law.
Here, the plaintiff failed to establish, prima facie, the defendants’ default in payment. In support of its motion, the plaintiff submitted an affidavit of an employee of its loan servicer who averred that he was personally familiar with the underlying mortgage loan and payment history based upon his review of certain business records maintained by the loan servicer and the plaintiff. However, the affiant failed to submit any business record substantiating the alleged default. Conclusory affidavits lacking a factual basis are without evidentiary value. Even assuming that the subject affidavit established a sufficient foundation for the records relied upon, it is the business record itself, not the foundational affidavit, that serves as proof of the matter asserted. Accordingly, the affiant’s assertions regarding the defendants’ default, without the business records upon which he relied in making those assertions, constituted inadmissible hearsay.
(Internal quotations and citations omitted).