Proposed New Jersey Bill Seeks to Help Homeowners Avoid Foreclosures

by Peter Vernon on Stop Foreclosures

Citing the effects that real estate foreclosures have not only on individual homeowners, but on communities, local economies and other people at large, New Jersey state officials are attempting to pass bills to help homeowners avoid foreclosures and hang on to their homes.

New Jersey’s foreclosure rate has been moderate in past years, but as in other locations, local neighborhoods and communities are starting to see the toll that real estate foreclosures take on the rest of the state, even for people unaffected by rising interest levels and hard to keep up with mortgage payments. In many areas where homeowners have found it difficult to avoid foreclosures, abandoned houses line entire block. Not only does this bring down property values for surrounding areas, it also contributes to a rise in crime. It’s long been proven that joblessness, homelessness and impoverished living conditions lead to crime in urban areas, and foreclosures have a direct impact on that.

The bill proposed would require lenders to pay a $2,000 fee for every foreclosure proceeding they initiate. This money would be pooled in a state fund which would then be used to help educate homeowners about how to avoid foreclosures, to fund emergency foreclosure assistance groups and would be contributed to advocacy groups looking to buy real estate foreclosures and use them in ways designed to reinvigorate communities and the local economy.

The bill would also allow homeowners to stay living in their homes until real estate foreclosures proceedings complete, hopefully allow them more time and peace of mind to find ways to avoid foreclosures. It would also provide a new six month grace period for defaulted homeowners, allowing them to have more time to seek assistance or take advantage of the new funds designed to help them avoid foreclosures.