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If you are facing foreclosure in New Jersey, it is critical that you understand the steps in the process. Keeping track of deadlines and answering your mail in a timely manner can be the difference between staying in your home or not. Below is a timeline of the major steps in a New Jersey foreclosure.
[2020 Update] NJ Foreclosure Timeline Overview
Although every foreclosure case is different, below are the general steps in the timeline of foreclosure in New Jersey:
The homeowner defaults on their mortgage payments. The lender or servicing company can begin the foreclosure process once there are past due payments.
The homeowner receives a Notice of Intent to Foreclose from their lender or servicer, giving them a final chance to reinstate their mortgage and get back on track with payments before the lender files the Foreclosure Complaint.
The lender must provide at least 30 days for the homeowner to make this payment before the complaint can be filed.
The public Foreclosure Complaint is filed, and Lis Pendens is filed with the county clerk.
Once this document is filed, the homeowner will start to receive advertisements from various parties offering assistance in the foreclosure process. It is important to be sure that assistance is coming from a reliable source. IT MAY BE A FORECLOSURE SCAM IF:
The company is not located in NJ;
The company does not have a NJ licensed attorney that you can speak with;
You get a notice that looks like it came from the Government with a number to call;
They tell you that you are about to lose your home;
You cannot speak to the attorney that is handling your file;
They require you to file the papers with the Court; or
They will not appear in Court to defend you
The homeowner is personally served with the complaint. If service fails for whatever reason, the lender will serve the complaint by mail or by publishing in a local newspaper.
The homeowner may file an answer to the complaint in Chancery Court – contesting or non-contesting. To properly defend themselves, they must file a contesting answer to the foreclosure complaint within 35 days of being served the complaint. A contesting Answer is one that disputes the Lender’s right to foreclose. If the homeowner files a contesting answer, the Court will issue a scheduling Order to allow for Discovery and possibly a Trial.
If the Homeowner can prove the Plaintiff does not have the right to foreclose, the Complaint can be dismissed. It is increasingly difficult to get Complaints dismissed. If a Complaint is dismissed, it is normally, “without prejudice.” This means that the lender can fix whatever mistakes were made and file a new Complaint. If a Complaint is dismissed “with prejudice” it means that the lender cannot file a new complaint and the property cannot be foreclosed. This is very rare. If the case can be dismissed, it should be evaluated to see if there are any claims that can be brought against the Lender or the Attorneys for improper actions.
If the Lender can show that they have the right to foreclose through a Motion to Strike the Answer, Motion for Summary Judgment, or at a trial, the litigation is over and the Lender can move towards a Sheriff Sale. The homeowner then receives a Notice of a Right to Cure, which gives one more chance to reinstate the loan and avoid foreclosure. At this point, the homeowner can extend the timeline by providing a good faith statement which says that they have a reasonable probability of obtaining the funds needed to reinstate the loan.
If the funds are not paid to reinstate, the Homeowner will receive a Notice of Motion for Entry of Final Judgment, which means the lender is asking the court to set the exact amount owed so they can schedule a Sheriff Sale. At this point, the homeowner can object to the amount due by showing proof that the Lender’s figures are wrong.
The lender obtains Final Judgment and Writ of Execution. The lender is no longer required to let the homeowner reinstate the mortgage. However, in many cases they will still allow reinstatement. But the homeowner still has options.
The homeowner can still apply for a loan modification after final judgment, as long as a complete application is submitted at least thirty-seven (37) days prior to the Sheriff Sale. For the most protections, the Modification Application should be submitted at least forty-five (45) days before the Sheriff sale.
The Sheriff Sale is scheduled. The amount of time between the lender applying for a sheriff sale and the date of the sale can vary depending on how busy the County’s schedule is. Please note that all sales are currently on hold, and you should check with your county sheriff ‘s website regularly to see when sales will start again.
The homeowner is entitled to two Adjournments of up to 30 days to delay the sale.
The Sheriff Sale takes place. This is the final stage in the foreclosure process. Once the sheriff sale is complete, the new owner will need to obtain a Writ of Possession or Order for Ejectment, in order to make the homeowner leave the property. They cannot simply lock them out of the house.
Learn more about Eviction after Foreclosure here. Please note that evictions are currently on hold, and you should check with your county sheriff ‘s website regularly to see when they will start again. Also, be aware that you will still be responsible for taxes, bills, and other costs after a sheriff sale.