Mortgage Default In New York State
In New York, when a mortgagor defaults, a mortgagee must elect between foreclosing on the property or pursuing a legal remedy, and may not prosecute both claims concurrently without leave of court (RPAPL 1301; see TBS Enterprises, Inc. v. Grobe, 114 AD2d 445, 494 N.Y.S.2d 716 , appeal denied 67 N.Y.2d 602, 490 N.E.2d 556, 499 N.Y.S.2d 1028 ; see Wyoming County Bank & Trust Co. v. Kiley, 75 AD2d 477, 480, 430 N.Y.S.2d 900 ).
This "election of remedies" rule also applies to actions on the guaranty of a note (see TBS Enterprises, Inc. v. Grobe, 114 AD2d 445, 494 N.Y.S.2d 716  supra).
However, RPAPL 1301 is strictly construed because it is in derogation of the common-law right to pursue the alternate remedies of foreclosure and recovery of the mortgage debt at the same time (see Dollar Dry Dock Bank v. Piping Rock Builders, Inc., 181 AD2d 709, 710, 581 N.Y.S.2d 361 ).
In keeping with such strict construction, RPAPL 1301(3) has been interpreted to be, by its terms, debt specific (see Central Trust Co. v. Dann, 85 NY2d 767, 772, 651 N.E.2d 1278, 628 N.Y.S.2d 259 ), i.e., for the statute to serve as a bar to simultaneous prosecution of a foreclosure and legal remedy, the separate claims must be for the same mortgage debt.