Bill Text: NJ A2227 | 2010-2011 | Regular Session | Introduced
Bill Title: The "New Jersey Homeowners' Equity Protection Act."
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2010-02-11 - Introduced, Referred to Assembly Financial Institutions and Insurance Committee [A2227 Detail]
Download: New_Jersey-2010-A2227-Introduced.html
Sponsored by:
Assemblyman JOHN F. MCKEON
District 27 (Essex)
SYNOPSIS
The "New Jersey Homeowners' Equity Protection Act."
CURRENT VERSION OF TEXT
As introduced.
An Act concerning an exemption from attachment for homesteads and supplementing Title 2A of the New Jersey Statutes.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. This act shall be known and may be cited as the "New Jersey Homeowners' Equity Protection Act."
2. As used in this act:
"Condominium" means the form of real property ownership provided for under the "Condominium Act," P.L.1969, c.257 (C.46:8B-1 et seq.).
"Dwelling house" means any residential property assessed as real property but shall not include a unit in a condominium or a horizontal property regime.
"Homestead" means:
a. a dwelling house and the land on which that dwelling house is located which constitutes the place of the owner's domicile and is owned and used by the owner as the owner's principal residence;
b. a condominium unit or a unit in a horizontal property regime which constitutes the place of the owner's domicile and is owned and used by the owner as the owner's principal residence;
c. a manufactured home as defined in section 2 of P.L.1990, c.61 (C.54:4-8.58).
"Horizontal property regime" means the form of real property ownership provided for under the "Horizontal Property Act," P.L.1963, c.168 (C.46:8A-1 et seq.).
"Owner" means, but is not limited to, a purchaser under a deed of trust, mortgage or contract.
"Principal residence" means a homestead occupied by the owner as the owner's permanent residence, as distinguished from a vacation home, property owned and rented or offered for rent by the owner, and other secondary real property holdings.
3. a. Any resident of this State may hold exempt from attachment, execution and forced sale a homestead exemption not exceeding $125,000 in value.
b. The homestead exemption automatically attaches to the owner's interest in identifiable cash proceeds from the voluntary or involuntary sale of the homestead. The homestead exemption in identifiable cash proceeds continues for 18 months after the date of the sale of the homestead or until the person establishes a new homestead with the proceeds, whichever period is shorter. Only one homestead exemption at a time may be held by an owner under this act.
c. A person who is entitled to a homestead exemption holds that exemption by operation of law and no written claim or recording is required.
4. If the owner is married, the homestead may consist of the jointly owned property of the spouses or the separate property of the spouses. Each spouse may claim a homestead exemption in an amount not to exceed the value provided in subsection a. of section 3 of this act.
5. a. A homestead exemption may be abandoned by any of the following:
(1) A declaration of abandonment or waiver.
(2) A transfer of the homestead property by deed of conveyance or contract for conveyance.
(3) A permanent removal of the owner as a resident of this State. The owner may remove from the homestead for up to two years without an abandonment or a waiver of the exemption.
b. A declaration of abandonment or waiver shall be executed by the owner and acknowledged. A declaration of abandonment or waiver is effective only from the time of its recording in the office of the county clerk.
6. The homestead exemption provided pursuant to this act shall not affect or apply to attachments, executions and sales in connection with:
a. government liens, including, but not limited to, taxes, special assessments or charges for other government services that, under State law, are senior liens;
b. voluntarily created liens, including, but not limited to, mortgages and liens secured by real property;
c. liens created pursuant to the "Construction Lien Law," P.L.1993, c.318 (C.2A:44A-1 et al.); and
d. court judgments concerning:
(1) fraud;
(2) fraudulent transfers or conveyances;
(3) duress; or
(4) fraud, deceit or manipulation in a fiduciary capacity.
7. This act shall take effect on the 180th day following enactment.
STATEMENT
This bill, entitled the "New Jersey Homeowners' Equity Protection Act," provides New Jersey residents with a homestead exemption from attachment, execution and forced sale in an amount not exceeding $125,000. Specifically, the bill defines a "homestead" as a (1) dwelling house and the land on which that dwelling house is located which constitutes the place of the owner's domicile and is owned and used by the owner as the owner's principal residence; or (2) condominium unit or a unit in a horizontal property regime which constitutes the place of the owner's domicile and is owned and used by the owner as the owner's principal residence. The bill further defines a "principal residence" as a homestead actually and continually occupied by the owner as the owner's permanent residence, as distinguished from a vacation home, property owned and rented or offered for rent by the owner, and other secondary real property holdings.
The homestead exemption automatically attaches to the owner's interest in identifiable cash proceeds from the voluntary or involuntary sale of the property and is exempt from attachment, execution and forced sale. The homestead exemption continues for 18 months from the sale of the property, or until the person establishes a new homestead with the proceeds, whichever period is shorter. The exemption arises by operation of law and no written claim or recording is required.
If the owner is married, each spouse may claim a homestead exemption in an amount not exceeding $125,000, for a total married couple exemption of up to $250,000.
A homestead exemption may be abandoned by a: (1) declaration of abandonment or waiver, which must be executed and acknowledged by the owner and recorded in the office of the county clerk; (2) transfer of the homestead property by deed or conveyance or contract for conveyance; or (3) permanent removal, exceeding two years, of the owner as a resident of this State.
The homestead exemption provided pursuant to the bill shall not affect or apply to attachments, executions and sales in connection with: (1) government liens, including, but not limited to, taxes, special assessments or charges for other government services that, under State law, are senior liens; (2) voluntarily created liens, including, but not limited to, mortgages and liens secured by real property; (3) liens created pursuant to the "Construction Lien Law," P.L.1993, c.318 (C.2A:44A-1 et al.); and (4) court judgments concerning fraud, fraudulent transfers or conveyances, duress, or fraud, deceit or manipulation in a fiduciary capacity.
