A bill that would create a fund to assist New Jersey residents facing foreclosure is headed to Gov. Phil Murphy’s desk after it passed the state Senate Friday.
The measure, S3244, would create the New Jersey Foreclosure Prevention Act, which allows the New Jersey Housing and Mortgage Finance Agency to purchase properties facing foreclosures to help residents in retaining control of their homes. It would also allow the agency to work with homeowners for a more affordable mortgage.
New Jersey has consistently ranked the highest in the nation for foreclosures, and was 4th highest in the nation for mortgage delinquencies in July. A 2018 report conducted by the state’s judiciary found New Jersey averaged 25,000 foreclosure filings in 2006 before shooting up to 65,000 per year in 2009.
And while foreclosures are on pause as long as the eviction moratorium is in place, housing advocates say a flood of filings could occur once the moratorium expires.
The program would be funded by the Foreclosure Intervention Fund, which will include money from a newly-imposed $350 fee on sheriff’s sales property purchase, and be created within 180 days of passing, according to the bill.
The bill would enable the HMFA to do bulk purchases of nonperforming loans of eligible properties, which would allow homeowners to refinance their mortgages to be more affordable so they can stay in their homes.
And the bill allows the agency to make grants to non-profit housing organizations, municipalities and other government entities to carry out similar duties as the HMFA.
A spokeswoman for the HMFA did not immediately respond for comment.
The measure was passed by the Senate with a vote of 26-9.