Gov. Phil Murphy on Monday signed into law a package of bills that aim to prevent New Jersey from having the dubious distinction of leading the nation in foreclosures.
The measures, which passed the state Legislature with bipartisan support, largely either help to keep people in their homes or attack the problem of vacant properties in neighborhoods by speeding up the sale of foreclosed properties or making the lender more accountable for following local zoning rules.
One of the new laws (S3411) tries to give homeowners in the state who have missed their mortgage payments more time to get back on track by requiring lenders send a notice of intent to foreclose no more than 180 days before they take any action to foreclose on the property.
Previously, a notice would have to be sent at least 30 days in advance of a residential mortgage lender initiating a foreclosure or other legal action to take possession of a residential property, according to the new law.
“The foreclosure crisis has hurt our economy and jeopardized economic security of too many New Jersey families," Murphy said. “Our communities cannot succeed while vacant or foreclosed homes sit empty or while families live in limbo. I am proud to sign these bills into law today and get New Jersey closer to ending the foreclosure crisis.”
The Democratic governor signed them at a public ceremony in Atlantic City, which he said has the highest foreclosure rate in the state.
A report released last year conducted by the state’s judiciary showed New Jersey averaged about 25,000 foreclosure filings per year in 2006 before spiking to 65,000 annually in 2009.
A separate report released last year showed New Jersey led the nation in foreclosures.
The governor also signed the following bills into law:
A664 — Makes permanent an existing program that aims to increase the number of people in mediation to pay off their debt rather than being forced out of their homes.
A4997 — Requires any person acting as a mortgage servicer to obtain a license from the Commissioner of Banking and Insurance for each main office and each branch office where business is conducted. That means anybody acting as a mortgage service provider who runs afoul of state rules will be barred from acting as a mortgage lender in the future.
A4999 — Proponents say they measure will help cities and towns fight so-called zombie foreclosures by forcing creditors to provide a contact person for foreclosed properties. They say it will give local officials somebody to contact about property maintenance and code violations.
A5001 — Cuts down the statute of limitations in residential mortgage foreclosures from 20 years to only six years from the date on which the debtor defaulted.
A5002 — Expands the pool of so-called common interest community associations to record liens for nonpayment. Currently, the law only allows condominium associations to file a lien to collect unpaid bills. The new law expands it to other shared communities.
S3413 — Attempts to ensure the timely sale of vacant properties by requiring foreclosure sales of vacant or abandoned properties be conducted within 60 days of a foreclosure judgment.
S3416 — Broadens the “New Jersey Residential Mortgage Lending Act,” which aims to protect homeowners, to apply to some out-of-state people and entities involved in residential mortgage lending in New Jersey.
S3464 — Expedites residential mortgage foreclosure proceedings by requiring the county sheriff to conduct a foreclosure sale within 120 days of the sheriff’s receipt of a writ of execution.
Matt Arco may be reached at marco@njadvancemedia.com. Follow him on Twitter @MatthewArco or Facebook.
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