Senate Advances Singleton, Addiego, Rice, Oroho Bill Package to Combat Surge in Foreclosures

State House 21

Trenton – Today, a bill package sponsored by Senate Community and Urban Affairs Committee Chair Troy Singleton, Senator Dawn Marie Addiego, Senator Ronald Rice and Senator Steve Oroho, which would tackle the surge in foreclosures and streamline the pending cases, advanced from the Senate.

The impetus of these bills stems from the report which was released in May of 2017 by Chief Justice Stuart Rabner and the Special Committee on Residential Foreclosures.  This report was the culmination of work from key stakeholders in the process such as the Administrative Office of the Courts (AOC).

“We all are aware that the surge in foreclosed properties continues to be an anchor that hinders more sustained economic growth in our state,”” said Senator Singleton (D-Burlington). “By solving the foreclosure issue, it will help increase property values and home prices, which will assist in improving our overall economic outlook. Therefore, New Jersey must adopt policies and programs that not only prevent foreclosures, but also stabilize neighborhoods.

“While this issue is not new, the comprehensive approach outlined in this bipartisan bill package is. It seeks to build upon the continued reduction in pending foreclosure cases and shorten the timeline to adjudicate these cases. This is a reflection of the work undertaken by the executive, judicial and legislative branches of government,” continued Singleton.

“There is a negative impact in neighborhoods and communities from having numerous foreclosed homes. They drive down the number of families interested in moving to our communities, and this can create a domino effect, which stifles economic growth throughout the state,” said Senator Addiego (D-Burlington/Atlantic/Camden). “This bill package will help us solve this problem and will reform procedures to make the foreclosure process more modernized.”

“In 2017, New Jersey led the country in foreclosures with nearly 70,000. By creating more venues in which homeowners in New Jersey can cure defaulted mortgages through the promotion of the mediation program, New Jersey stands to significantly reduce its foreclosure numbers,” said Senator Rice (D-Essex). “This bill seeks to strengthen the mediation program in New Jersey by creating a self-funding mechanism and by promoting remedy options to those homeowners in the initial stages of the foreclosure process.”

“Foreclosures are traumatic experiences that lead to the loss of a family home, a child’s school, and one’s sense of community,” Senator Steven Oroho (R-Morris/Sussex/Warren) said. “Currently we are unable to publicly track foreclosed homes throughout New Jersey. Creating an interactive statewide database of foreclosed homes can help towns register the mortgage holders on those properties, reducing the number of unoccupied houses that create economic and public safety issues in our neighborhoods. It can also help the public locate properties that can be purchased and rehabilitated into productive use. Turning vacant properties into livable homes will make New Jersey a safer and stronger state.”

The following bills were sponsored by Senator Singleton, Senator Addiego, and Senator Oroho:

The first bill, S-3411, would require that a notice, with the intention to foreclose, would not be sent more than 180 days in advance of taking that action. Currently, a notice must 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.

The second bill, S-3412, would require the Department of Community Affairs (DCA) to create a database with an interactive map which would detail the extent of foreclosed properties in New Jersey. The database would be developed, maintained and updated daily, and would be required to be transmitted electronically.

The third bill, S-3413, would make changes to the summary action foreclosure process under the “Fair Foreclosure Act” by clarifying the method by which foreclosed properties can be sold on an expedited timeline.

The fourth bill, S-3414, would permit all common interest community associations to record a lien for unpaid assessments, and to provide limited priority over prior recorded mortgages and other liens for nine months-worth of unpaid customary assessments.

The fifth bill, S-3415, would require the filing of certain contact information of creditors with a residential mortgage foreclosure complaint and pending legal action.

The sixth bill, S-3416, would clarify that the provisions of the “New Jersey Residential Mortgage Lending Act,” also apply to certain out-of-state persons and entities involved in residential mortgage lending in the State. Debtors would be provided with a notice that the lender is licensed in accordance with the Act.

The seventh bill, S-3417, entitled the “Mortgage Servicers Licensing Act,” would require 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. The commissioner would also issue a mortgage servicer license to an applicant if the commissioner makes certain findings, including that the applicant has met certain financial and character and fitness requirements.

The eighth bill, S-3418, would revise the statute of limitations in residential mortgage foreclosure actions from 20 years to six years from the date on which the debtor defaulted, in situations in which the date of default is used as the method to determine when the statute of limitations has expired.

The last bill, S-3464, would revise certain procedures under the “Fair Foreclosure Act” to expedite residential mortgage foreclosure proceedings. The bill would require the sheriff to conduct a foreclosure sale within 120 days of the sheriff’s receipt of a writ of execution.

In addition to the above bills, Senator Rice and Senator Singleton also sponsored a related bill, S-1244, which would codify the Judiciary’s Foreclosure Mediation Program, and would dedicate funds from foreclosure filing fees and fines.