Governor Christie recently signed P.L. 2014 c. 5, a law that amends New Jersey’s mortgage foreclosure statute. The legislation was sponsored by Senator Ron Rice and Assemblyman Ralph Caputo.
Pursuant to N.J.S.A. 46:10B-51 et seq., there are numerous requirements placed on banks, savings and loan associations, credit unions and other state licensed lenders that are foreclosing on residential properties. A creditor seeking to foreclose on residential property must serve notice on the municipal clerk of the filing of the foreclosure summons and complaint within 10 days of serving the summons and complaint. The notice must contain the full name and contact information for a service agent of the creditor located within the State.
The law also requires that the bank abate any nuisances that may arise if the property becomes abandoned during the foreclosure proceeding. Additionally, if a municipality expends money to abate the nuisance, a lien can be placed on the property.
The new amendment grants a municipality further authority in these situations. The amendment allows a municipality to impose penalties on creditors which fail to address nuisances on vacant properties during the foreclosure process. The municipality must (a) provide to the creditor a description of the conditions that give rise to the violation of law, and (b) give the creditor at least 30 days’ notice to remedy the violation before the municipality can impose the penalty.
Banks, savings and loans, and credit unions should immediately begin implementing procedures to ensure they comply with this latest revision to the foreclosure statute. The amendment takes effect 60 days following enactment, and was signed by Governor Christie on May 15, 2014.
For more information about the lawsuit discussed or the legal issues involved, we encourage you to contact a member of Scarinci Hollenbeck’s Government Law Group.