Murphy Administration Allocates $10 Million To Help Homeowners Facing Foreclosure

TRENTON, NJ — More help is on the way for New Jersey residents facing foreclosure.

In all, $10 million from the Rescue Plan Act of 2021 (ARPA) will be allocated to support New Jersey’s Foreclosure Prevention Act program, which is administered by the New Jersey Housing and Mortgage Finance Agency (NJHMFA). It was created to put a limit on single-family homes that are foreclosed and sold to rental property investment firms. 

The Murphy administration anticipates using the money purchase nonperforming mortgage notes from the Federal Housing Administration (FHA) prior to foreclosure proceedings. If the homeowner occupies the property, efforts will be made to help them. If the property has been abandoned, steps will be taken to obtain title, complete any required rehabilitation and return the home to the single-family market.

Last March, Sens. Troy Singleton (D-District 7) and Nellie Pou (D-District 35) championed the New Jersey Foreclosure Prevention Act, which allows NJHMFA to purchase foreclosed residential properties in order to assist residents in retaining control of the properties. Additionally, through the program, the agency is authorized to enter into contracts or loans — or both — with qualified community development financial institutions to negotiate, bid for and purchase nonperforming loans of eligible properties and mortgage assets. The new law’s goal is to prevent properties from falling vacant and joining the ranks of thousands of vacant homes that already exist in New Jersey.

"We have made great strides to address the previous foreclosure crisis in New Jersey, and we do not want history to repeat itself," Singleton said. “I applaud Gov. Murphy for utilizing available federal dollars to fund the Foreclosure Prevention Act. This will keep as many families as possible in their existing homes, which will prevent a tidal wave of new foreclosures and even homelessness." 

According to real estate data provider Attom, New Jersey had the fifth-highest rate of foreclosure activity in the country in 2021 — a number keeps continues to rise due to the nationwide impact of the COVID-19 pandemic on homeowners.

Original Article