Senator STEVEN V. OROHO
District 24 (Morris, Sussex and Warren)
Senator TROY SINGLETON
District 7 (Burlington)
Senator DAWN MARIE ADDIEGO
District 8 (Atlantic, Burlington and Camden)
Requires notice of intention in residential mortgage foreclosure actions to be filed no more than 180 days prior to commencing foreclosure; limits reinstatements of dismissed mortgage foreclosure actions.
CURRENT VERSION OF TEXT
As amended by the Senate on February 21, 2019.
An Act concerning residential mortgage foreclosure and amending and supplementing P.L.1995, c.244.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 4 of P.L.1995, c.244 (C.2A:50-56) is amended to read as follows:
4. a. Upon failure to perform any obligation of a residential mortgage by the residential mortgage debtor and before any residential mortgage lender may accelerate the maturity of any residential mortgage obligation and commence any foreclosure or other legal action to take possession of the residential property which is the subject of the mortgage, the residential mortgage lender shall give the residential mortgage debtor notice of such intention 1,1 which shall include a notice of the right to cure the default as provided in section 5 of P.L.1995, c.244 (C.2A:50-57) 1,1 at least 30 days, but not more than 180 days, in advance of such action as provided in this section.
b. Notice of intention to take action as specified in subsection a. of this section shall be in writing, sent to the debtor by registered or certified mail, return receipt requested, at the debtor's last known address, and, if different, to the address of the property which is the subject of the residential mortgage. The notice is deemed to have been effectuated on the date the notice is delivered in person or mailed to the party.
c. The written notice shall clearly and conspicuously state in a manner calculated to make the debtor aware of the situation:
(1) the particular obligation or real estate security interest;
(2) the nature of the default claimed;
(3) the right of the debtor to cure the default as provided in section 5 of [this act] P.L.1995, c.244 (C.2A:50-57);
(4) what performance, including what sum of money, if any, and interest, shall be tendered to cure the default as of the date specified under paragraph (5) of this subsection c.;
(5) the date by which the debtor shall cure the default to avoid initiation of foreclosure proceedings, which date shall not be less than 30 days after the date the notice is effective, and the name and address and phone number of a person to whom the payment or tender shall be made;
(6) that if the debtor does not cure the default by the date specified under paragraph (5) of this subsection c., the lender may take steps to terminate the debtor's ownership in the property by commencing a foreclosure suit in a court of competent jurisdiction;
(7) that if the lender takes the steps indicated pursuant to paragraph (6) of this subsection c., a debtor shall still have the right to cure the default pursuant to section 5 of [this act] P.L.1995, c.244 (C.2A:50-57), but that the debtor shall be responsible for the lender's court costs and attorneys' fees in an amount not to exceed that amount permitted pursuant to the Rules Governing the Courts of the State of New Jersey;
(8) the right, if any, of the debtor to transfer the real estate to another person subject to the security interest and that the transferee may have the right to cure the default as provided in [this act] P.L.1995, c.244 (C.2A:50-53 et seq.), subject to the mortgage documents;
(9) that the debtor is advised to seek counsel from an attorney of the debtor's own choosing concerning the debtor's residential mortgage default situation, and that, if the debtor is unable to obtain an attorney, the debtor may communicate with the New Jersey Bar Association or Lawyer Referral Service in the county in which the residential property securing the mortgage loan is located; and that, if the debtor is unable to afford an attorney, the debtor may communicate with the Legal Services Office in the county in which the property is located;
(10) the possible availability of financial assistance for curing a default from programs operated by the State or federal government or nonprofit organizations, if any, as identified by the Commissioner of Banking and Insurance. This requirement shall be satisfied by attaching a list of such programs promulgated by the commissioner; [and]
(11) the name and address of the lender and the telephone number of a representative of the lender whom the debtor may contact if the debtor disagrees with the lender's assertion that a default has occurred or the correctness of the mortgage lender's calculation of the amount required to cure the default; and
(12) that the debtor is entitled to housing counseling, at no cost to the debtor, through the Foreclosure Mediation Program established by the New Jersey Judiciary, including information on how to contact the program.
d. The notice of intention to foreclose required to be provided pursuant to this section shall not be required if the debtor has voluntarily surrendered the property which is the subject of the residential mortgage.
e. The duty of the lender under this section to serve notice of intention to foreclose is independent of any other duty to give notice under the common law, principles of equity, State or federal statute, or rule of court and of any other right or remedy the debtor may have as a result of the failure to give such notice.
f. Compliance with this section shall be set forth in the pleadings of any legal action referred to in this section. If the plaintiff in any complaint seeking foreclosure of a residential mortgage alleges that the property subject to the residential mortgage has been abandoned or voluntarily surrendered, the plaintiff shall plead the specific facts upon which this allegation is based.
g. If more than 180 days have elapsed since the date the notice required pursuant to this section is sent, and any foreclosure or other legal action to take possession of the residential property which is the subject of the mortgage has not yet been commenced, the lender shall send a new written notice at least 30 days, but not more than 180 days, in advance of that action.
(cf: P.L.2003, c.298, s.1)
2. (New section) a. If a plaintiff's action to foreclose a residential mortgage has been dismissed without prejudice pursuant to R.4:64-8 of the Rules Governing the Courts of New Jersey of the State of New Jersey, reinstatement of the plaintiff's action may be permitted only on motion for good cause shown 1[and reinstatements]. Reinstatements1 shall be limited to three for any action 1, except that a reinstatement which is granted following a dismissal without prejudice that resulted from the plaintiff's compliance with federal law or regulation shall not count toward the limit established by this subsection1. The fee for a plaintiff to reinstate a residential mortgage foreclosure action shall be twice the amount set 1[by the Administrative Office of the Courts]1 for filing a foreclosure complaint. The plaintiff shall not charge or otherwise pass a reinstatement fee onto the debtor or any other person.
b. The amounts paid by plaintiffs for reinstating a mortgage pursuant to subsection a. of this section, that are over and above the amounts set 1[by the Administrative Office of the Courts]1 for filing a foreclosure complaint, shall be aggregated and divided equally on an annual basis, with one-half dedicated to the New Jersey Housing and Mortgage Finance Agency for the purposes of funding the counseling component provided by the agency for the New Jersey Judiciary's Foreclosure Mediation Program, and one-half dedicated to the Administrative Office of the Courts for the general operations provided by the office for the New Jersey Judiciary's Foreclosure Mediation Program.
3. This act shall take effect on the first day of the fourth month next after enactment.