New Jersey-2022-S3795-Introduced

An Act allowing use of certain State funds to help disaster victims process applications for assistance and amending P.L.2021, c.373.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. Section 1 of P.L.2021, c.373 (C.2A:50-81) is amended to read as follows:

1. The Legislature finds and declares that:

a. The Foreclosure Mediation Assistance Program administered by the New Jersey Housing and Mortgage Finance Agency provides trained foreclosure prevention and default mitigation counselors for homeowner-borrowers participating in the Foreclosure Mediation Program established by the New Jersey Judiciary.

b. As provided by section 7 of the "New Jersey Foreclosure Mediation Act," P.L.2019, c.64 (C.2A:50-80), trained foreclosure prevention and default mitigation counselors are paid using a portion of funds paid by a foreclosure plaintiff in an action for foreclosure.

c. During the public health emergency declared by the Governor in Executive Order No. 103 of 2020 due to the coronavirus disease 2019 (COVID-19) pandemic, the New Jersey Housing and Mortgage Finance Agency expanded its Foreclosure Mediation Assistance Program to provide other supports to New Jersey residents including renter and pre-foreclosure counseling.

d. Since the expansion began, nearly 5,000 households have been served.

e. Sufficient funding exists for trained foreclosure prevention and default mitigation counselors to continue to provide pre-foreclosure counseling services although the public health emergency declared by the Governor in Executive Order No. 103 of 2020 has concluded.

f. In the event of a declaration of a state of emergency, persons who have been trained to provide foreclosure counseling services under the Foreclosure Mediation Assistance Program are well positioned to help disaster victims prepare and submit applications for State and federal disaster assistance.

(cf: P.L.2021, c.373, s.1)

2. Section 2 of P.L.2021, c.373 (C.2A:50-82) is amended to read as follows:

2. a. There is established in the General Fund a separate, non-lapsing, dedicated account administered by the Department of Community Affairs to be known as the "New Jersey Foreclosure Counseling Fund."

b. The funds within the New Jersey Foreclosure Counseling Fund shall be paid to the New Jersey Housing and Mortgage Finance Agency no later than the 15th day of each quarter to reimburse trained foreclosure prevention and default mitigation counselors for costs expended thereby in:

(1) providing pre-foreclosure counseling services in accordance with guidance established by the New Jersey Housing and Mortgage Finance Agency and for the agency's services required under P.L.2019, c.64 (C.2A:50-74 et seq.); and

(2) providing, to homeowners and renters who have been impacted by real property damage to, or destruction on, their primary residence, as a result of an event that prompted the Governor or the President of the United States to declare a state of emergency or issue an emergency disaster declaration, assistance in the preparation and submission of applications for housing related expenses, including, but not limited to: (a) rental payments; (b) mortgage payments; (c) insurance payments; (d) property tax payments; and (e) repair, rehabilitation, or relocation assistance payments that have been made available, by the State or federal government, in response to the declared emergency or disaster.

c. The New Jersey Housing and Mortgage Finance Agency may assess up to five percent of New Jersey Foreclosure Counseling Fund's annual allocation amounts for administrative costs.

d. For purposes of this section, "trained foreclosure prevention and default mitigation counselors" shall have the same definition as in section 2 of the "New Jersey Foreclosure Mediation Act," P.L.2019, c.64 (C.2A:50-75).

(cf: P.L.2021, c.373, s.2)

3. This act shall take effect immediately.

STATEMENT

This bill would direct the New Jersey Housing and Mortgage Finance Agency (HMFA), in the event of a state of emergency, to allocate amounts from the New Jersey Foreclosure Counseling Fund to the Foreclosure Mediation Assistance Program (FMAP) for the reimbursement of trained foreclosure prevention counselors and default mitigation counselors who provide pre-foreclosure counseling services and assist disaster victims with the preparation and submission of applications for State and federal disaster assistance.

Under this bill, in the event of a disaster, the HMFA would further expand the FMAP to enable trained foreclosure prevention counselors and default mitigation counselors to help homeowners
and renters who have been impacted by real property damage to, or destruction on, their primary residence, as a result of a disaster to apply for housing related expenses, and for repair, rehabilitation, or relocation assistance payments made available by the State or federal government.