New Jersey Foreclosure Laws

New Jersey foreclosure is governed by Jersey Foreclosure Act and carried out through the judicial procedure where typical foreclosure timeline is about 9 months. Non-judicial foreclosures are not handled in New Jersey.

Judicial Foreclosure Information

Lenders sought foreclosure sale on a property when the borrower or homeowner defaults on payments. Before the case is appealed in court, the lender needs to issue a Notice of Default addressed to the defaulted borrower to inform him or her of the amount owed. Also, this Notice will serve as warning to the borrower that a foreclosure complaint will be employed if the debt will not be cured within 30 days. If after the 30-day grace period the lender does not obtain payment, that person can file for a complaint against the borrower in court. This pending lawsuit is also known as lis pendens. Once the lawsuit is filed, the borrower is given 35 days to respond. After that given period, the court may rule against the borrower if found that that person failed to settle debt.

Foreclosure laws in New Jersey requires that a Notice of Intent to Enter Foreclosure Judgment will be served to the defendants or borrowers who failed to settle their debt. This will serve as a final chance for the borrower to pay off their loan and reclaim the property. The lender should wait for 45 days before advancing to the next legal process. If the borrower failed to meet the terms in the Notice, the lender may now appeal to court to favor foreclosure on a distressed property. At this point, the court issues a Writ of Execution authorizing the county sheriff to schedule the date of the foreclosure sale.

The foreclosure sale which is similar to that of a public auction is supervised by the Sheriff. The property will be awarded to the highest bidder. Once payment has been secured, property ownership will be transferred to the winning bidder after 10 days; provided that former homeowner does not redeem the property.

Under New Jersey foreclosure laws, a statutory right of redemption is permitted. This allows the borrower or homeowner whose property has been foreclosed to reclaim ownership of the said property. The borrower is given 10 days to redeem the property by making a full payment of the total unpaid loan plus applicable costs.

Lenders may obtain deficiency judgment for a property which is sold for less than the amount of mortgage loan. Once deficiency action is favored to the lender, the borrower needs to pay for the difference between the amount of the property sold for at the foreclosure sale and the amount of the original loan. Lender is given 3 months to claim for deficiency judgment.

Notice Of Sale New Jersey

A Notice of Sale is important and should be published in at least 2 newspapers and posted in the county courthouse and on the property in question. Notice should be mailed to the borrower or homeowner at least 10 days before the public auction.