Bill Text: NJ A3791 | 2024-2025 | Regular Session | Introduced
Bill Title: The "New Jersey Online Foreclosure Sale Act;" permits online foreclosure sales for real property.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Introduced) 2024-02-22 - Introduced, Referred to Assembly Housing Committee [A3791 Detail]
Download: New_Jersey-2024-A3791-Introduced.html
Sponsored by:
Assemblyman BENJIE E. WIMBERLY
District 35 (Bergen and Passaic)
Assemblywoman VERLINA REYNOLDS-JACKSON
District 15 (Hunterdon and Mercer)
SYNOPSIS
The "New Jersey Online Foreclosure Sale Act;" permits online foreclosure sales for real property.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning the electronic sale of real property at foreclosure, supplementing chapter 61 of Title 2A of the New Jersey Statutes, and amending N.J.S.2A:61-1 and N.J.S.2A:61-4.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. (New section) P.L. , c. (C. ) (pending before the Legislature as this bill) shall be known and may be cited as the "New Jersey Online Foreclosure Sale Act."
2. (New section) Any sheriff or other officer or person authorized or required by statute, court directive, or other law to conduct an electronic, online foreclosure sale of real estate, may conduct the sale in accordance with the following requirements:
a. The sheriff or other officer or person may enter into a contract with a vendor to conduct an electronic, online foreclosure sale of real estate, provided that New Jersey law governs the contract and the relationship between vendor and the officer. Any such contract shall detail the sheriff's reasonable requirements with respect to: services; fee amounts; method of charging a fee in the auction, including a seller's or buyer's fee; commission or premium charged to a seller or buyer; recovery maximization; marketing; track record in creating competitive auctions that maximize recovery for the benefit of debtors and lenders; record-keeping requirements; and security requirements.
b. The sheriff or other officer or person may enter into a contract with an electronic real property foreclosure service provider through competitive contracting pursuant to P.L.1999, c.440 (C.40A:11-4.1 et seq.), without the need for a resolution by the governing body.
c. An officer, employee, or independent contractor of the vendor shall not participate in the auction.
d. All bids entered during the auction shall be visible to the public online and displayed at the time they are placed. Any maximum bid amounts provided by bidders ahead of the sale shall not be visible to the public or to the sheriff while the auction is in process until the bid is placed.
e. A seller's commission or fee charged to a sheriff or other officer or person by a vendor for conducting an electronic real property foreclosure service shall be deemed a reasonable and necessary taxable expense pursuant to N.J.S.22A:2-8. The vendor shall not charge a fee for the public to view properties for sale.
f. A vendor conducting electronic, online foreclosures may provide services related to transaction settlement and funds handling. A vendor may charge customary and reasonable fees for funds handling and transfer.
g. (1) Notwithstanding any other provision of this section to the contrary, the total of all fees charged by a vendor shall not exceed $1,000 per action. The $1,000 limit pursuant to this subsection shall include but not be limited to, all administrative fees charged by a vendor, including a $50 processing fee, which a vendor shall be permitted to collect at the commencement of the sale as an administrative fee, and a seller's commission or fee pursuant to subsection e. of this section.
(2) Any fees charged by a vendor shall be taken directly from the purchaser's deposit with the vendor, and any vendor fees shall not reduce or impact the sheriff's fees pursuant to N.J.S.22A:4-8.
3. N.J.S.2A:61-1 is amended to read as follows:
2A:61-1. a. When any sheriff, coroner, master, executor, administrator, guardian, commissioner, auditor or other officer or person is authorized or required by any public statute or the direction of any court of competent jurisdiction in this State to make sales of real estate, [he] that person shall, unless otherwise specially directed or authorized by law, before making the sale, give notice of the time and place of the sale by public advertisement, signed by [himself] that person, and set up in the office of the sheriff of the county or counties where the real estate is located and at the premises to be sold, at least [3] three weeks before the time appointed for the sale. The notice need not be set up at any other place. The notice of sale shall include either a diagram of the premises or a concise statement indicating the municipality, the tax lot and block and where appropriate, the street and street number, and the dimensions of the premises, as well as the number of feet to the nearest cross street. The notice of sale shall state that the diagram or concise description does not constitute a full legal description of the premises, and shall state where the full legal description can be found.
b. (1) Such officer or person shall also cause the notice to be published [4] four times, at least once a week, during [4] four consecutive weeks, in two newspapers, to be by [him] the officer or person designated[,] as follows:
(a) both printed and published in the county where the real estate to be sold is located, one of which shall be either a newspaper published at the county seat of the county or a newspaper published in the municipality in the county having the largest population according to the latest census[, or] ;
(b) one printed and published in the county and one circulating in the county, if only one daily newspaper is printed and published in the county[, or] ;
(c) one published at the county seat and one circulating in the county, if no daily newspaper is published in the county[,] ; or
(d) both circulating in the county, if no newspapers are printed and published in the county.
The first publication shall be at least 21 days prior and the last publication not more than [8] eight days prior to the time appointed for the sale of the real estate.
Whenever, in the opinion of any such officer or person, the ends of justice shall require it, or the sale being conducted by [him] the officer or person will be benefited thereby, the notice of sale may be published in three newspapers instead of two, as required by [the second paragraph] subsection b. of this section, if there be that number printed and published in the county where the real estate to be sold is located.
The officer or person so advertising in the newspapers shall be entitled therefor, in addition to his other fees, to the sum of $1.50, except where it is otherwise specifically provided.
(2) Notwithstanding the provisions of this section, if the sale of property is to be conducted in an online, electronic format, the officer or person shall also publish notice of the time and place of the sale online on the Internet website at which the sale will be conducted electronically.
c. If the sale of real estate is conducted electronically online pursuant to section 2 of P.L. , c. (C. ) (pending before the Legislature as this bill), then, in addition to the requirements set forth in subsection a. of this section, the notice shall state that the sale is being held by means of an electronic, online auction, and the notice shall include the auction's Internet website address.
d. If an online foreclosure auction format is used, the vendor shall provide a non-electronic option for bidders, which may include a paper bid packet.
(cf: P.L.1979, c.364, s.1)
4. N.J.S.2A:61-4 is amended to read as follows:
2A:61-4. a. Any officer or person [mentioned] who is authorized or required in [section] N.J.S.2A:61-1 of this title, making a sale of real estate governed by this chapter, shall, at the time and place appointed therefor, between the hours of [12 and 5 in the afternoon] 12:00 p.m. and 5:00 p.m., if requested by any person interested in the sale of the real estate to be sold, read the description of the real estate to be sold by metes and bounds, or, in the absence of such a request, the officer or person making the sale shall announce the street and number, or streets and numbers, of the real estate to be sold, or the block and lot number or numbers by which such real estate is designated on the taxing maps of the municipality or municipalities in which the same is situate, if the same is not identified by a street and number or streets and numbers on such taxing maps, and where there is no street number or lot and block number, the officer or person making the sale may announce such description or designation as to him may be deemed sufficient, and sell such real estate at public vendue to the highest bidder.
b. As an alternative to the procedures in subsection a. of this section, any officer or person who is authorized or required in N.J.S.2A:61-1 of this title, making a sale of real estate governed by this chapter, may conduct the sale by means of electronic auction conducted online.
(cf: N.J.S.2A:61-4)
5. This act shall take effect on the first day of the second month next following enactment.
STATEMENT
This bill, known as the "New Jersey Online Foreclosure Sale Act," would permit the sale of foreclosed-upon property in an electronic, online forum that is open to the public. The conducting of real estate sales online could attract more bidders and result in higher purchase prices, which would benefit both creditors and debtors in New Jersey. The bill would not alter the timeline of foreclosure sales and, except as to requiring the sheriff or other officer or person conducting the real estate sale to publish notice of the time and place of the sale online on the Internet website at which the sale will be conducted, would substantially change the notice requirements pertaining to the foreclosure process.
The bill authorizes a sheriff, or other officer or person who is authorized or required to sell real estate, to conduct an online foreclosure sale of real estate, and to contract with a vendor for online foreclosure sale services. As the needs and requirements of counties may vary, this bill provides authority to contract for the services and requirements suited to a particular county, which may include, but are not limited to: types of services; fee amounts; method of charging a fee in the auction, including a seller's or buyer's fee, commission or premium charged to a seller or buyer; recovery maximization; record-keeping requirements; and security requirements. Further, the bill would enable a county or municipality to procure electronic, online real property foreclosure services through competitive contracting without the need for a resolution by the governing body.
The bill requires that the total of all fees charged by a vendor or entity to the sheriff or other officer or person authorized or required to sell real estate are not to exceed $1,000 per auction, which would include but not be limited to, a seller's commission or fee and all administrative fees charged by a vendor, including a $50 processing fee that a vendor is to be permitted to collect at the commencement of the sale. The bill also requires that any fees charged by a vendor are to be taken directly from the purchaser's deposit with the vendor, and are not to reduce or impact the collection of sheriff's fees. Finally, the bill provides that if an online foreclosure auction format is used, a vendor is required to provide a non-electronic option for bidders, which may include a paper bid packet.
This bill would take effect on the first day of the second month following enactment.
