RICE-STACK BILL TO HELP CLEAN UP FORECLOSED PROPERTIES ADVANCES

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TRENTON – A bill sponsored by Senators Ronald L. Rice and Brian Stack to help clean up foreclosed properties by allowing municipalities to penalize creditors that fail to timely remedy code violations was approved by the Senate Community and Urban Affairs Committee today by a vote of 5-0.

“When a foreclosed home sits vacant within a community, it can become a magnet for criminal activity, and can deteriorate to cause an economic blight on the remaining homes within the community,” said Senator Rice, D-Essex.  “When these abandoned homes fall into disrepair, the creditors who are legally responsible for them should step up, do the right thing, and maintain the home.  If they fail to fix the property in a timely manner, municipal officials should have the ability to impose penalties.”

“We’ve seen cases where abandoned foreclosed homes aren’t kept up and as a result create problems that affect the rest of the municipality,” said Senator Stack, D-Hudson.  “Not only can these properties drag down home values but they also can create a financial burden on everyone else when towns are forced to conduct maintenance and police patrols of the area. By requiring creditors who initiate the foreclosure proceedings to maintain these homes or face penalties, we’re putting the responsibility for maintenance where it belongs.”

The bill, S288, would authorize municipalities to impose penalties on creditors that fail to timely remedy code violations for residential properties in foreclosure for which the creditor is legally responsible.  The bill would require a municipality to include a description of the conditions that gave rise to the violation with the notice of violation and to provide a period of not less than 30 days for the creditor to remedy the violation. Under the bill, if the creditor fails to remedy the violation within that 30-day time period, then the municipality would be permitted to impose penalties as outlined for violations of municipal ordinances under current law.

A second bill, S1229, sponsored by Senator Rice, would allow the appropriate municipal code enforcement officials to issue a citation against creditors who are in the process of foreclosing on residential property if the condition of the property is found to be in violation of a municipal ordinance, rule or regulation. A municipal court could impose a fine on a creditor for up to $2,500 for each day that the property is deemed to be in violation. The bill, which cleared the committee by a vote of 5-0, would also require out-of-state creditors who have served a notice of intention to foreclose on a residential property to designate an in-state person or entity responsible for the care, maintenance, and upkeep of the property.

The bills next head to the full Senate for consideration.