Posted By USFN,
Wednesday, February 06, 2013
Updated: Monday, November 30, 2015
| Comments (0)
February 6, 2013
by Rosemarie Diamond
Phelan Hallinan & Diamond
USFN Member (New Jersey, Pennsylvania)
Since the stays of foreclosure that began in New Jersey in 2010, and the slow start-up of new processes after the release of the stays in 2011, many vacant properties have lingered in foreclosure, causing concerns and creating challenges in neighborhoods and local communities. To address these issues, the New Jersey legislature passed a provision in autumn 2012 allowing for the expedited foreclosure of vacant and abandoned residential properties that have fallen into disrepair. The bill, known as Senate Bill 2156, was signed into law by the governor on December 3, 2012. The final version of the signed bill has not been released as of this writing, but it should largely follow the legislative version described below. The law will take effect four months after it was enacted, i.e., in April 2013.
The new procedure allows lenders to use an expedited process to obtain final judgment in foreclosure if the property is vacant and abandoned. The lender may file a summary action at any time during an active foreclosure action. Unlike other uncontested foreclosure cases, for which all final judgments are processed at the centralized Office of Foreclosure in Trenton, New Jersey, the summary motion to expedite the foreclosure of vacant and abandoned property is filed in the county court, where the property is located. The lender must present clear and convincing evidence that the property is abandoned, as well as all other evidence required to prove the default and support the request for final judgment.
The sheriff has 60 days to take the property to sale. If the sheriff does not sell the property in 60 days, the lender can file a motion to appoint a special master to sell the property.
In order to prove the property is vacant and abandoned, the lender must present evidence of at least two of the following listed conditions, although this author’s firm recommends that as many relevant factors be identified as possible to show a good faith effort to request an expedited foreclosure in only the most appropriate circumstances:
- Overgrown or neglected vegetation
- The accumulation of newspapers, circulars, flyers, or mail on the property
- Disconnected gas, electric, or water utility services to the property
- The accumulation of junk, litter, trash or, debris, or hazardous, noxious, or unhealthy substances or materials on the property
- The absence of window treatments such as blinds, curtains, or shutters
- The absence of furnishings or personal items
- Statements of neighbors, delivery persons, or government employees indicated that the residence is vacant and abandoned
- Windows or entrances that are boarded up or multiple window panes that are damaged, broken, or unrepaired
- Doors to the property that are smashed through, broken off, unhinged, or continuously unlocked
- A risk to health, safety, or welfare of the public, or any adjoining or adjacent property owners, as a result of vandalism, loitering, criminal conduct, or physical destruction or deterioration of the property
- An uncorrected violation of municipal building, housing, or similar codes during the preceding year
- The mortgagee or other authorized party has secured or winterized the property due to the property being deemed vacant and unprotected or in danger of freezing
- A written statement issued by the mortgagor expressing the clear intent to abandon the property
- Or any other reasonable indicia of abandonment
The law does not apply if there is an unoccupied building that is undergoing construction, renovation, or rehabilitation that is proceeding diligently; if the building is occupied on a seasonal basis, but otherwise secure; or if the building is secure, but subject to a probate action or other ownership dispute.
Lenders are cautioned to draw a distinction between those properties that were vacant and abandoned prior to Hurricane Sandy, and those properties that were damaged during the hurricane and are awaiting evaluation for rehabilitation.
© Copyright 2013 USFN. All rights reserved
Winter 2013 USFN Report
This post has not been tagged.