New Jersey Passes Law to Expedite Foreclosures
A bill that would accelerate the process to foreclose mortgages on vacant and abandoned residential properties in New Jersey has been signed by Gov. Chris Christie.
The law, S-2156, allows judges to enter foreclosure judgments for residential real estate that is deserted, therefore allowing banks to not deal with the time-consuming default foreclosure process. In the third quarter, RealtyTrac said New Jersey documented the second longest state foreclosure timeline nationwide, where it takes 931 days to complete the foreclosure process.
Property is deemed to be “vacant and abandoned” if the court finds that the mortgaged property is not occupied by a mortgagor or tenant as evidenced by a lease agreement entered into prior to the service of a notice of intention to commence foreclosure.
Two out of a possible 15 conditions have to be proved by the court to move forward with the foreclosure. Some examples of these conditions include: overgrown vegetation, the accumulation of garbage on the property, disconnected electric or water utility services, the absence of curtains or shutters as well as furnishings inside the home, statements by neighbors or deliverymen that the property is empty, boarded up windows or entrances and an uncorrected code violation.
If the court determines that a property is vacant and abandoned, the sheriff could then sell the property within 60 days of the receipt of any writ of execution issued by the judge.
New Jersey Sen. Raymond Lesniak (D-Union), who sponsored this legislation, said the goal is to reduce the timetable for turning these homes around and to decrease community blight.
Others sponsors of the bill include Assemblyman Jerry Green (D-Middlesex, Somerset and Union); Assemblyman Troy Singleton (D-Burlington); Assemblyman Anthony Bucco (R-Morris and Somerset); Assemblywoman Mila Jasey (D-Essex and Morris); Assemblyman Benjie Wimberly (D-Bergen and Passaic).
In general, the passage of this bill is a benefit for bankers, builders, housing advocates and real estate agents and brokers.
“Blighted properties depreciate home values in the rest of the community, forcing homeowners to pay more into their mortgages than their homes are worth,” Lesniak said in a press release. “However, it can take over a year for abandoned properties to be foreclosed, and with a difficult housing market, it can take even longer for those homes to be resold and rehabilitated. This bill reduces the foreclosure time period to hopefully get these properties off the foreclosure roles and turn them back into homes for New Jersey families.”