NJCUL’s foreclosure survey to inform lawmakers

October 28, 2015

HIGHTSTOWN, N.J. (10/28/15)--In order to inform state lawmakers about the effects of pending foreclosure-related legislation, the New Jersey Credit Union League (NJCUL) is surveying member credit unions (The Daily Exchange Oct. 26).

“We’re collecting this information so we can inform legislators how these proposals complicate the foreclosure process, which already can take up to three years to complete,” said Chris Abeel, NJCUL vice president of corporate and governmental affairs.

Credit unions already must cover property taxes and insurance on foreclosed properties. The proposed rules would increase credit unions’ maintenance responsibilities, including satisfying municipal codes, to those beyond what homeowners are held to.

The additional costs hurt lenders and future borrowers by increasing the financial burden on the financial institution, Abeel noted.

Legislative proposals include:

  • Establishing a $1,200 foreclosure filing surcharge to fund community groups’ foreclosure prevention workshops;
  • Increasing requirements to maintain buildings in foreclosure, both interior and exterior;
  • Requiring registration of certain vacant and abandoned properties with municipalities and permit municipalities to require protective measures be taken for such properties;
  • Authorizing municipalities to impose penalties on creditors that fail to remedy code violations of certain properties in foreclosure;
  • Establishing a three-year foreclosure moratorium for Superstorm Sandy as well as other natural disaster victims; and
  • Codifying the Judiciary's Foreclosure Mediation Program and dedicate monies from foreclosure filing fees and fines.

The league was successful in gaining amendments to an earlier foreclosure-maintenance bill, which now holds lenders to the same standards as homeowners.

According to a recent RealtyTrac report, New Jersey's foreclosure rate was the highest in the nation in the third quarter of 2015. New Jersey’s foreclosure activity increased 27% in the last three months compared with the same quarter last year. The number of foreclosure starts in the state dropped from a year ago, but scheduled foreclosure auctions and bank repossessions increased.