New Jersey Lawmakers Give the Green Signal to Foreclosure Assistance Measure
New Jersey lawmakers has given the green signal to foreclosure assistance measures that will enable borrowers to refinance their mortgages or permit them to live in the same houses as tenants while they get back their financial bearings. The Mortgage Stabilization and Relief Act was cleared in the Assembly and the Senate. It has now proceeded for the signature of Governor Jon S. Corzine who gave indications that he would do so quickly so as to make it into law.
According to the new law $25 million has been set aside for this measure. Loan will be given for a maximum amount of $25,000 to house owners who have come to an understanding with lenders to refinance a first mortgage that is threatened with foreclosure.
The bill has also created a fund of $15 million for the housing recovery programme. It will assist non-profit bodies to purchase houses for those who cannot afford mortgages. These will then be rented out as lease back to the previous house owners. The lease will continue for seven years – thus allowing them sufficient time to recover their financial position.
This creative piece of law will put the onus on the creditors in the foreclosure workouts. They will be held accountable if the borrowers walk away and abandon the houses. Foreclosures will have to be kept in abeyance for six months if the borrower asks for this time to work out loan modification.
Democrat Assemblyman, Ralph Caputo said, “It would be a failure of leadership to sit idly by and let entire neighborhoods fall overboard.” He was a co-sponsor of the bill.
With increase in unemployment, foreclosures too have been spiking. October has seen the highest number of foreclosure filings in New Jersey. Over 5,000 filings had been recorded.
For those facing foreclosure, bankruptcy and debt travails, an additional amount of $9.5 million has been set aside. The law has also made it compulsory for mediations to be held before proceeding with foreclosure.
The measure has been highly applauded by the executive director of the Housing Community Development Network of New Jersey, Diane Sterner. Sterner said, “The foreclosure issue has many aspects, and this legislation makes major strides in addressing many of them.
The bill to help stabilize the localities hardest hit by foreclosures has also created a housing support fund. The target is to keep people in their houses.
Foreclosures in New Jersey Top Counties
