N.J. Stat. tit. 46, ch. 10B

in effect

N.J. Stat. § 46:10B-1 Definitions

As used in this act: (a) "Mortgage loan" means a loan secured by an interest in real property consisting of land upon which is erected or to be erected, in whole or in part with the proceeds of such loan, a structure containing one, two, three, four, five or six dwelling units, a portion of which structure may be used for nonresidential purposes and upon which interest is taken or contracted for at a rate in excess of $6.00 for the forbearance of $100.00 for a year; (b) "Mortgagor" includes any person other than a corporation liable for the payment of a mortgage loan, and the owner of the real property which secures the payment of a mortgage loan; (c) "Prepayment" of a mortgage loan means the payment in full of the balance owing on a mortgage loan at any time prior to the time limited for the final payment of such loan in an instrument evidencing such loan. L.1968, c. 54, s. 1, eff. June 6, 1968. Amended by L.1979, c. 85, s. 2, eff. May 10, 1979.

N.J. Stat. § 46:10B-2 Prepayment of mortgage loan without penalty

Prepayment of a mortgage loan may be made by or on behalf of a mortgagor at any time without penalty. L.1968, c. 54, s. 2, eff. June 6, 1968. Amended by L.1973, c. 297, s. 1, eff. Dec. 6, 1973; L.1975, c. 87, s. 1, eff. May 8, 1975; L.1979, c. 85, s. 3, eff. May 10, 1979; L.1979, c. 253, s. 2, eff. Dec. 21, 1979.

N.J. Stat. § 46:10B-3 Additional payments

A mortgagor shall have the right, during any 6 month period beginning with the date of the mortgage loan, to pay, without charge or penalty, an additional sum of $50.00, or multiples thereof, on account of the principal amount owing on a mortgage loan, provided that the additional sums so paid and the principal payments required to be made by the terms of such mortgage loan during such 6 month period do not together exceed in any such 6 month period 33 1/3 % of the face amount of such mortgage loan. The right to make additional payments as provided by this section shall not be cumulative, and to the extent that it is not exercised during any 6 month period, shall lapse. L.1968, c. 54, s. 3, eff. June 6, 1968. Amended by L.1979, c. 86, s. 19, eff. May 15, 1979; L.1979, c. 388, s. 11, eff. Feb. 5, 1980.

N.J. Stat. § 46:10B-4 Invalidity of mortgage provisions

No provision in a mortgage or instrument of indebtedness which denies the rights conferred by sections 2 and 3 of this act, or which provides for prepayment fees in excess of those permitted by this act, or in which the rights conferred by sections 2 and 3 of this act are modified to the detriment of the mortgagor, or are waived or surrendered, shall be enforceable. L.1968, c. 54, s. 4, eff. June 6, 1968.

N.J. Stat. § 46:10B-5 Violation; return of fees plus interest

Any holder of a mortgage loan or agent acting on behalf of the holder of a mortgage loan who shall knowingly demand and receive prepayment fees, except as provided in this act, shall be liable to the mortgagor for the return of the whole amount of the prepayment fees so received, plus interest thereon from the date of such receipt at the rate of 6% per annum. L.1968, c. 54, s. 5, eff. June 6, 1968.

N.J. Stat. § 46:10B-6 Failure to deliver cancellation or discharge; forfeiture of fee

Any holder of a mortgage loan or agent acting on behalf of such holder who shall willfully fail or refuse to deliver a cancellation or discharge of a mortgage loan within a reasonable time after tender to him of the amount owing thereon together with the prepayment fee, if any, as provided in this act, shall forfeit his right to receive any prepayment fee, and the Superior Court shall have jurisdiction, in a summary action or otherwise, to order such cancellation or discharge upon payment into court of the amount owing thereon. L.1968, c. 54, s. 6, eff. June 6, 1968.

N.J. Stat. § 46:10B-7 Failure to accept additional payments; forfeiture of interest

Any holder of a mortgage loan or agent acting on behalf of such holder who shall wilfully fail or refuse to accept additional payments tendered pursuant to section 3 of this act shall forfeit his right to receive interest on the amount so tendered. L.1968, c. 54, s. 7, eff. June 6, 1968.

N.J. Stat. § 46:10B-8 Increase in interest rate; limitation

If any mortgage loan or written contract or commitment for such loan provides for an increase in the rate of interest during the term of such loan, or after the execution of a written contract or commitment for such a loan, the increased rate shall not exceed 6% per annum in the case of a loan or written contract or commitment made before the effective date of this act or such rate of interest as may be authorized by law at the time such loan or written contract or commitment for such loan is made in the case of a loan or written contract or commitment for such loan made on or after the effective date of this act. L.1968, c. 54, s. 8, eff. June 6, 1968.

N.J. Stat. § 46:10B-9 Application of act

This act shall not apply to loans secured by a mortgage on real property the prepayment of which is governed by any other statute of this State or of the United States, nor shall it apply to any loans, secured by mortgage on real property, made pursuant to any statute of this State or of the United States expressly authorizing interest charges in excess of 6% per annum. L.1968, c. 54, s. 9, eff. June 6, 1968.

N.J. Stat. § 46:10B-10 Interest rate; points

Except as otherwise provided by law, no mortgage loan shall be made at an interest rate in excess of the rate authorized by section 31:1-1 of the Revised Statutes. The charging of points in connection with a mortgage loan is prohibited. For the purposes of this act, "points" means an amount of money or other consideration paid for the making of a mortgage loan, other than interest payable pursuant to the terms of the mortgage loan, but does not include any such sum paid pursuant to a statute of this State or of the United States, nor does it include reasonable expenses and charges. L.1968, c. 54, s. 10, eff. June 6, 1968.

N.J. Stat. § 46:10B-11 Points; liability for receiving

Any holder of a mortgage loan or agent acting on behalf of the holder of a mortgage loan who shall knowingly receive points as defined herein shall be liable to the mortgagor for the return of the points and all interest paid on the mortgage loan plus a penalty of $1,000.00 and costs to be recovered by the mortgagor in a civil action instituted within 6 years from the date of payment of the points. L.1968, c. 54, s. 11, eff. June 6, 1968.

N.J. Stat. § 46:10B-11.1 Discount points deemed interest on loan

Discount points paid by the buyer or seller in connection with a mortgage loan on a one-to-six family dwelling, occupied or to be occupied by the owner shall be deemed to be interest charged on the loan. For the purposes of this section, "discount point" shall mean an amount of money equal to 1% of the principal amount of the loan and payable at closing. L.1981, c. 103, s. 19, eff. March 31, 1981.

N.J. Stat. § 46:10B-12 Graduated payment mortgage defined

As used in this act, "graduated payment mortgage" means a mortgage loan with lower monthly payments of principal and interest during the early years of the mortgage and higher monthly payments during the later years of the mortgage. The graduation rate for the monthly payments, the term of graduation, and the interest rate are fixed throughout the term of the mortgage. Monthly payments of principal and interest are required in amounts sufficient to pay all interest and effect full repayment of principal within the term of the mortgage. L.1979, c. 139, s. 1, eff. July 6, 1979.

N.J. Stat. § 46:10B-13 Authorization to make

Notwithstanding any law, rule, regulation, or opinion to the contrary, it shall be lawful for any institution authorized in this State to make mortgage loans secured by a mortgage on real property to make graduated payment mortgages. L.1979, c. 139, s. 2, eff. July 6, 1979.

N.J. Stat. § 46:10B-14 Use for dwelling units; limits on interest

Graduated payment mortgages may be secured only by real estate on which there is erected or to be erected a structure containing one, two, three, four, five, or six dwelling units, a portion of which structure may be used for non-residential purposes, and interest thereon shall not exceed the usury rate established pursuant to R.S. 31:1-1 at any time during the term of the mortgage. L.1979, c. 139, s. 3, eff. July 6, 1979.

N.J. Stat. § 46:10B-15 Option to convert to conventional level payment mortgage

At any time during the life of the graduated payment mortgage the mortgagor shall have the option without penalty to convert to a conventional level payment mortgage. L.1979, c. 139, s. 4, eff. July 6, 1979.

N.J. Stat. § 46:10B-16 Short title

This act shall be known and may be cited as the "Senior Citizen Homeowner's Income Security Act." L.1979, c. 140, s. 1, eff. July 6, 1979.

N.J. Stat. § 46:10B-17 Definitions

As used in this act: "Reverse annuity mortgage" means a mortgage loan secured by unencumbered residential property of the mortgagor which loan is used by the mortgagee to purchase annuities for the benefit of the mortgagor. "Reverse direct payment mortgage" means a mortgage loan secured by unencumbered residential property of the mortgagor, which loan is paid directly to the mortgagor in fixed amounts over the term of the mortgage not to exceed 10 years, or such other term as may be established by the Commissioner of Banking by regulation. L.1979, c. 140, s. 2, eff. July 6, 1979.

N.J. Stat. § 46:10B-18 Reverse annuity and reverse direct payment mortgages; authorization to make; conditions

Notwithstanding any law, rule, regulation, or opinion to the contrary, it shall be lawful for any institution authorized in the State to make first lien loans secured by a mortgage on real property to make reverse annuity mortgages and reverse direct payment mortgages subject to the following conditions: a. Said mortgages shall be made to a mortgagor who is at least 60 years old; provided, however, that the Commissioner of Banking may by regulation raise or lower the age limit for eligibility. Such mortgages shall not be made in an amount to exceed 70% of the value of the mortgaged property, or such amount as is established by the commissioner by regulation. b. Said mortgages shall be made voidable at the option of the mortgagor upon payment of the principal and interest to date, with no penalty. c. Interest on said mortgages shall not exceed the usury rate. L.1979, c. 140, s. 3, eff. July 6, 1979.

N.J. Stat. § 46:10B-19 Option of mortgagor to enter into subsequent mortgage with same mortgagee

With respect to a reverse annuity mortgage or a reverse direct payment mortgage, at the termination of the mortgage the mortgagor shall have the option to enter into a subsequent reverse annuity mortgage or a reverse direct payment mortgage with the same mortgagee, provided the mortgagee consents to the subsequent reverse annuity mortgage or the reverse direct payment mortgage and provided the mortgaged property has not depreciated significantly during the term of the initial mortgage and the subsequent mortgage does not exceed 90% of the value of the unencumbered portion of the mortgaged property, or such amount as is established by the commissioner by regulation. L.1979, c. 140, s. 4, eff. July 6, 1979.

N.J. Stat. § 46:10B-20 Exemption of income from New Jersey Gross Income Tax Act

Income derived by mortgagors from mortgages authorized pursuant to this act shall not be considered income for purpose of the "New Jersey Gross Income Tax Act" . L.1979, c. 140, s. 5, eff. July 6, 1979.

N.J. Stat. § 46:10B-21 Regulations

The Commissioner of Banking may make such regulations as he deems necessary to effectuate the purposes of this act. L.1979, c. 140, s. 6, eff. July 6, 1979.

N.J. Stat. § 46:10B-22 Short title.

1. This act shall be known and may be cited as the "New Jersey Home Ownership Security Act of 2002." L.2003,c.64,s.1.

N.J. Stat. § 46:10B-23 Findings, declarations relative to abusive lending practices.

2. The Legislature finds and declares that: a. Abusive mortgage lending has become an increasing problem in this State, exacerbating the loss of equity in homes and causing an increase in the number of foreclosures in recent years. One of the most common forms of abusive lending is the making of loans that are equity-based, rather than income-based. The financing of points and fees in these loans provides immediate income to the originator and encourages the repeated refinancing of home loans. The lender's ability to sell loans reduces the incentive to ensure that the homeowner can afford the payments of the loan. As long as there is sufficient equity in the home, an abusive lender benefits even if the borrower is unable to make the payments and is forced to refinance. In addition, the financing of high points and fees causes the loss of precious equity in each refinancing and often leads to foreclosure. b. Abusive lending has threatened the viability of many communities and caused decreases in home ownership. While the marketplace appears to operate effectively for conventional mortgages, too many homeowners find themselves victims of overreaching lenders who provide loans with unnecessarily high costs and terms that are unnecessary to secure repayment of the loan. c. As competition and self-regulation have not eliminated the abusive terms from loans secured by a consumer's home, the consumer protection provisions of this act are necessary to encourage lending at reasonable rates with reasonable terms. d. Pursuant to this 2004 amendatory act, the "New Jersey Home Ownership Security Act of 2002," P.L.2003, c.64 (C.46:10B-22 et seq.) was amended to delete the covered home loan category and the provisions of subsection b. of section 4 of P.L.2003, c.64 (C.46:10B-25) which prohibited flipping a home loan. The deletions of the covered home loan category and of the prohibition on flipping shall create no presumption that any home loan that has been refinanced is not unconscionable, and the deletions of the covered home loan category and of the prohibition on flipping shall create no presumption that any home loan that is refinanced does not constitute an unlawful practice under P.L.1960, c.39 (C.56:8-1 et seq.). L.2003,c.64,s.2; amended 2004, c.84, s.1.

N.J. Stat. § 46:10B-24 Definitions relative to abusive lending practices.

3. As used in this act: "Affiliate" means any company that controls, is controlled by, or is under the common control with any company, as set forth in 12 U.S.C. s.1841 et seq. "Bona fide discount points" means loan discount points which are: (1) Knowingly paid by the borrower; (2) Paid for the express purpose of reducing, and which result in a reduction of, the interest rate or time-price differential applicable to the loan; (3) In fact reducing the interest rate or time-price differential applicable to the loan from an interest rate which does not exceed the conventional mortgage rate for a home loan secured by a first lien, by more than two percentage points, or for a home loan secured by a junior lien, by more than three and one half percentage points; and (4) Recouped within the first five years of the scheduled loan payments. Loan discount points will be considered to be recouped within the first five years of the scheduled loan payments if the reduction in the interest rate that is achieved by the payment of the loan discount points reduces the interest charged on the scheduled payments such that the borrower's dollar amount of savings in interest over the first five years is equal to or exceeds the dollar amount of loan discount points paid by the borrower. "Borrower" means any natural person obligated to repay the loan, including a coborrower, cosigner, or guarantor. "Commissioner" means the Commissioner of Banking and Insurance. "Conventional mortgage rate" means the most recently published annual yield on conventional mortgages published by the Board of Governors of the Federal Reserve System, as published in Statistical Release H.15 or any publication that may supersede it, as of the applicable time set forth in 12 C.F.R. 226.32(a)(1)(i). "Conventional prepayment penalty" means any prepayment penalty or fee that may be collected or charged in a home loan, and that is authorized by law other than by this act, provided the home loan (1) does not have an annual percentage rate that exceeds the conventional mortgage rate by more than two percentage points; and (2) does not permit any prepayment fees or penalties that exceed two percent of the amount prepaid. "Creditor" means a person who extends consumer credit that is subject to a finance charge or is payable by written agreement in more than four installments, and to whom the obligation is payable at any time. Creditor shall also mean any person brokering a home loan, which shall include any person who directly or indirectly solicits, processes, places, or negotiates home loans for others or who closes home loans which may be in the person's own name with funds provided by others and which loans are thereafter assigned to the person providing the funding of such loans, provided that creditor shall not include a person who is an attorney providing legal services to the borrower or a person or entity holding an individual or organization insurance producer license in the line of title insurance or a title insurance company, as defined by subsection c. of section 1 of P.L.1975, c.106 (C.17:46B-1), or any officer, director or employee thereof, providing services in the closing of a home loan who is not also funding the home loan and is not an affiliate of the creditor or an assignee that is subject to the provisions of section 6 of this act. "Department" means the Department of Banking and Insurance. "High-cost home loan" means a home loan for which the principal amount of the loan does not exceed $350,000, which amount shall be adjusted annually to include the last published increase of the housing component of the national Consumer Price Index, New York- Northeastern New Jersey Region, in which the terms of the loan meet or exceed one or more of the thresholds as defined in this section. "Home loan" means an extension of credit primarily for personal, family or household purposes, including an open-end credit plan, other than a reverse mortgage transaction, in which the loan is secured by: (1) A mortgage or deed of trust on real estate in this State upon which there is located or there is to be located a one to six family dwelling which is or will be occupied by a borrower as the borrower's principal dwelling; or (2) A security interest in a manufactured home which is or will be occupied by a borrower as the borrower's principal dwelling. "Manufactured home" means a structure, transportable in one or more sections, which in the traveling mode is eight body feet or more in width or 40 body feet or more in length or, when erected on site is 320 or more square feet and which is built on a permanent chassis and designed to be used as a dwelling with a permanent foundation when erected on land secured in conjunction with the real property on which the manufactured home is located and connected to the required utilities and includes the plumbing, heating, air-conditioning and electrical systems contained therein; except that such term shall include any structure which meets all the requirements of this paragraph except the size requirements and with respect to which the manufacturer voluntarily files a certification required by the Secretary of the United States Department of Housing and Urban Development and complies with the standards established under the federal National Manufactured Housing Construction and Safety Standards Act of 1974, 42 U.S.C. s.5401 et seq. Such term does not include rental property or second homes or manufactured homes when not secured in conjunction with the real property on which the manufactured home is located. "Points and fees" means: (1) All items listed in 15 U.S.C. s.1605(a)(1) through (4), except interest or the time- price differential; (2) All charges listed in 15 U.S.C. s.1605(e); (3) All compensation paid directly or indirectly to a mortgage broker, including a broker that originates a loan in its own name in a table-funded transaction; (4) The cost of all premiums financed by the creditor, directly or indirectly for any credit life, credit disability, credit unemployment or credit property insurance, or any other life or health insurance, or any payments financed by the creditor directly or indirectly for any debt cancellation or suspension agreement or contract, except that insurance premiums calculated and paid on a monthly basis shall not be considered financed by the creditor; (5) The maximum prepayment fees and penalties that may be charged or collected under the terms of the loan documents; (6) All prepayment fees or penalties that are incurred by the borrower if the loan refinances a previous loan made or currently held by the same creditor or an affiliate of the creditor, except that this paragraph shall not apply to a loan which refinances a previous loan made by the same broker and funded by another creditor; and (7) For open-end loans, the points and fees are calculated by adding the total points and fees known at or before closing, including the maximum prepayment penalties which may be charged or collected under the terms of the loan documents if prepayment penalties are authorized by law other than by this act, plus the minimum additional fees the borrower would be required to pay to draw down an amount equal to the total credit line. "Points and fees" shall not include the following items: title insurance premiums and fees, charges and premiums paid to a person or entity holding an individual or organization insurance producer license in the line of title insurance or a title insurance company, as defined by subsection c. of section 1 of P.L.1975, c.106 (C.17:46B-1); taxes, filing fees, and recording and other charges and fees paid or to be paid to public officials for determining the existence of or for perfecting, releasing, or satisfying a security interest; and reasonable fees paid to a person other than a creditor or an affiliate of the creditor or to the mortgage broker or an affiliate of the mortgage broker for the following, provided that the conditions in 12 C.F.R. s.226.4(c)(7) are met: fees for tax payment services; fees for flood certification; fees for pest infestation and flood determinations; appraisal fees; fees for inspections performed prior to closing; fees for credit reports; fees for surveys; attorneys' fees; notary fees; escrow charges; and fire and flood insurance premiums, provided that the conditions in 12 C.F.R. s.226.4(d)(2) are met. "Rate" means that annual percentage rate for the loan calculated at closing based on the points and fees set forth in this act and according to the provisions of 15 U.S.C. s.1601 et seq. and the regulations promulgated thereunder by the Federal Reserve Board. "Threshold" means any one of the following two items, as defined: (1) "Rate threshold" means the annual percentage rate of the loan at the time the loan is consummated such that the loan is considered a "mortgage" under section 152 of the federal "Home Ownership and Equity Protection Act of 1994," Pub.L. 103-325 (15 U.S.C. s.1602(aa)), and the regulations promulgated by the Federal Reserve Board, including 12 C.F.R. s.226.32, without regard to whether the loan transaction is or may be a "residential mortgage transaction," as defined in 12 C.F.R. s.226.2(a)(24). (2) "Total points and fees threshold" means that the total points and fees payable by the borrower at or before the loan closing, excluding either a conventional prepayment penalty or up to two bona fide discount points, exceed: (a) 4.5% of the total loan amount if the total loan amount is $40,000 or more; or (b) the lesser of 6% of the total loan amount or $1,000, if the total loan amount is less than $20,000, and 6% if the total loan amount is $20,000 or more but less than $40,000. "Total loan amount" means the principal of the loan minus those points and fees as defined in this section that are included in the principal amount of the loan. For open-end loans, the total loan amount shall be calculated using the total line of credit allowed under the home loan. L.2003,c.64,s.3; amended 2004, c.84, s.2.

N.J. Stat. § 46:10B-25 Creditors, prohibited practices relative to home loans.

4. a. No creditor making a home loan shall finance, directly or indirectly, any credit life, credit disability, credit unemployment or credit property insurance, or any other life or health insurance, or any payments directly or indirectly for any debt cancellation or suspension agreement or contract, except that insurance premiums or debt cancellation or suspension fees calculated and paid on a monthly basis shall not be considered financed by the creditor. b. (Deleted by amendment, P.L.2004, c.84). c. No creditor shall recommend or encourage default on an existing loan or other debt prior to and in connection with the closing or planned closing of a home loan that refinances all or any portion of that existing loan or debt. d. No creditor shall charge a late payment fee in relation to a home loan except according to the following rules: (1) The late payment fee may not be in excess of 5% of the amount of the payment past due. (2) The fee may only be assessed by a payment past due for 15 days or more. (3) The fee may not be charged more than once with respect to a single late payment. If a late payment fee is deducted from a payment made on the loan, and such deduction causes a subsequent default on a subsequent payment, no late payment fee may be imposed for such default. If a late payment fee has been once imposed with respect to a particular late payment, no such fee shall be imposed with respect to any future payment which would have been timely and sufficient, but for the previous default. (4) No fee shall be charged unless the creditor notifies the borrower within 45 days following the date the payment was due that a late payment fee has been imposed for a particular late payment. No late payment fee may be collected from any borrower if the borrower informs the creditor that nonpayment of an installment is in dispute and presents proof of payment within 45 days of receipt of the creditor's notice of the late fee. (5) The creditor shall treat each and every payment as posted on the same date as it was received by the creditor, servicer, creditor's agent, or at the address provided to the borrower by the creditor, servicer, or the creditor's agent for making payments. e. No home loan shall contain a provision that permits the creditor, in its sole discretion, to accelerate the indebtedness. This provision does not prohibit acceleration of the loan in good faith due to the borrower's failure to abide by the material terms of the loan. f. No creditor shall charge a fee for informing or transmitting to any person the balance due to pay off a home loan or to provide a release upon prepayment. Payoff balances shall be provided within seven business days after the request. L.2003,c.64,s.4; amended 2004, c.84, s.3.

N.J. Stat. § 46:10B-26 High-cost home loans, limitations, prohibited practices.

5. A high-cost home loan shall be subject to the following additional limitations and prohibited practices: a. No high-cost home loan shall contain a scheduled payment that is more than twice as large as the average of earlier scheduled payments. This provision shall not apply when the payment schedule is adjusted to the seasonal or irregular income of the borrower. b. No high-cost home loan shall include payment terms under which the outstanding principal balance will increase at any time over the course of the loan because the regular periodic payments do not cover the full amount of interest due. c. No high-cost home loan shall contain a provision that increases the interest rate after default. This provision shall not apply to interest rate changes in a variable rate loan otherwise consistent with the provisions of the loan documents, provided the change in the interest rate is not triggered by the event of default or the acceleration of the indebtedness. d. No high-cost home loan shall include terms under which more than two periodic payments required under the loan are consolidated and paid in advance from the loan proceeds provided to the borrower. e. Without regard to whether a borrower is acting individually or on behalf of others similarly situated, any provision of a high-cost home loan agreement that allows a party to require a borrower to assert any claim or defense in a forum that is less convenient, more costly, or more dilatory for the resolution of a dispute than a judicial forum established in this State if the borrower may otherwise properly bring a claim or defense or limits in any way any claim or defense the borrower may have is unconscionable and void. f. A creditor shall not make a high-cost home loan unless the creditor has given the following notice, or substantially similar notice, in writing, to the borrower, acknowledged in writing and signed by the borrower not later than the time the notice is required under the notice provision contained in 12 C.F.R. s.226.31(c). NOTICE TO BORROWER YOU SHOULD BE AWARE THAT YOU MIGHT BE ABLE TO OBTAIN A LOAN AT A LOWER COST. YOU SHOULD SHOP AROUND AND COMPARE LOAN RATES AND FEES. MORTGAGE LOAN RATES AND CLOSING COSTS AND FEES VARY BASED ON MANY FACTORS, INCLUDING YOUR PARTICULAR CREDIT AND FINANCIAL CIRCUMSTANCES, YOUR EMPLOYMENT HISTORY, THE LOAN-TO-VALUE REQUESTED AND THE TYPE OF PROPERTY THAT WILL SECURE YOUR LOAN. THE LOAN RATE AND FEES COULD ALSO VARY BASED ON WHICH CREDITOR OR BROKER YOU SELECT. IF YOU ACCEPT THE TERMS OF THIS LOAN, THE CREDITOR WILL HAVE A MORTGAGE LIEN ON YOUR HOME. YOU COULD LOSE YOUR HOME AND ANY MONEY YOU PUT INTO IT IF YOU DO NOT MEET YOUR PAYMENT OBLIGATIONS UNDER THE LOAN. YOU SHOULD CONSULT AN ATTORNEY-AT-LAW AND A QUALIFIED INDEPENDENT CREDIT COUNSELOR OR OTHER EXPERIENCED FINANCIAL ADVISOR REGARDING THE RATE, FEES AND PROVISIONS OF THIS MORTGAGE LOAN BEFORE YOU PROCEED. A LIST OF QUALIFIED COUNSELORS IS AVAILABLE BY CONTACTING THE NEW JERSEY DEPARTMENT OF BANKING AND INSURANCE. YOU ARE NOT REQUIRED TO COMPLETE THIS LOAN AGREEMENT MERELY BECAUSE YOU HAVE RECEIVED THIS DISCLOSURE OR HAVE SIGNED A LOAN APPLICATION. REMEMBER, PROPERTY TAXES AND HOMEOWNER'S INSURANCE ARE YOUR RESPONSIBILITY. NOT ALL CREDITORS PROVIDE ESCROW SERVICES FOR THESE PAYMENTS. YOU SHOULD ASK YOUR CREDITOR ABOUT THESE SERVICES. ALSO, YOUR PAYMENTS ON EXISTING DEBTS CONTRIBUTE TO YOUR CREDIT RATINGS. YOU SHOULD NOT ACCEPT ANY ADVICE TO IGNORE YOUR REGULAR PAYMENTS TO YOUR EXISTING CREDITORS. g. A creditor shall not make a high-cost home loan to a borrower who finances points and fees in connection with a high-cost home loan without first receiving certification from a third-party nonprofit credit counselor, approved by the United States Department of Housing and Urban Development and the Department of Banking and Insurance, that the borrower has received counseling on the advisability of the loan transaction or completing another substantial requirement developed by the department. h. A creditor shall not pay a contractor under a home-improvement contract from the proceeds of a high-cost home loan, unless the instrument is payable to the borrower or jointly to the borrower and the contractor, or, at the election of the borrower, through a third-party escrow agent in accordance with terms established in a written agreement signed by the borrower, the creditor, and the contractor prior to the disbursement. i. A creditor shall not charge a borrower any fees or other charges to modify, renew, extend, or amend a high-cost home loan or to defer any payment due under the terms of a high- cost home loan. j. A creditor shall not charge a borrower points and fees in connection with a high- cost home loan if the proceeds of the high-cost home loan are used to refinance an existing high- cost home loan held by the same creditor as note holder. k. Notwithstanding any other law to the contrary, a creditor making a high-cost home loan that has the legal right to foreclose shall use the judicial foreclosure procedures of this State so long as the property securing the loan is located in this State. l. No creditor making a high-cost home loan shall directly or indirectly finance points and fees in excess of 2% of the total loan amount. L.2003,c.64,s.5.

N.J. Stat. § 46:10B-27 Affirmative claims, defenses by borrower.

6. a. Notwithstanding any other law to the contrary, if a home loan was made, arranged, or assigned by a person selling either a manufactured home, or home improvements to the dwelling of a borrower, or was made by or through a creditor to whom the borrower was referred by such seller, the borrower may assert all affirmative claims and any defenses that the borrower may have against the seller or home-improvement contractor limited to amounts required to reduce or extinguish the borrower's liability under the home loan, plus the total amount paid by the borrower in connection with the transaction, plus amounts required to recover costs, including reasonable attorney's fees against the creditor, any assignee or holder, in any capacity. b. Notwithstanding any other provision of law, any person who purchases or is otherwise assigned a high-cost home loan shall be subject to all affirmative claims and any defenses with respect to the loan that the borrower could assert against the original creditor or broker of the loan; provided that this subsection shall not apply if the purchaser or assignee demonstrates, by a preponderance of the evidence, that a reasonable person exercising reasonable due diligence could not determine that the mortgage was a high-cost home loan. It shall be presumed that a purchaser or assignee has exercised such due diligence if the purchaser or assignee demonstrates by a preponderance of the evidence that it: (1) has in place at the time of the purchase or assignment of the loan, policies that expressly prohibit its purchase or acceptance of assignment of any high-cost home loan; (2) requires by contract that a seller or assignor of home loans to the purchaser or assignee represents and warrants to the purchaser or assignee that either (a) it will not sell or assign any high-cost home loan to the purchaser or assignee or (b) that the seller or assignor is a beneficiary of a representation and warranty from a previous seller or assignor to that effect; and (3) exercises reasonable due diligence at the time of purchase or assignment of home loans or within a reasonable period of time thereafter intended by the purchaser or assignee to prevent the purchaser or assignee from purchasing or taking assignment of any high-cost home loan. c. Notwithstanding any other law to the contrary, but limited to amounts required to reduce or extinguish the borrower's liability under the home loan plus amounts required to recover costs including reasonable attorney's fees, a borrower acting only in an individual capacity may assert against the creditor or any subsequent holder or assignee of the home loan: (1) within six years of the closing of a high-cost home loan, a violation of this act in connection with the loan as an original action; and (2) at any time during the term of a high-cost home loan after an action to collect on the home loan or foreclose on the collateral securing the home loan has been initiated or the debt arising from the home loan has been accelerated or the home loan has become 60 days in default, any defense, claim or counterclaim. d. It is a violation of this act for any person, in bad faith, to attempt to avoid the application of this act by: (1) Dividing any loan transaction into separate parts; or (2) Any other such subterfuge, with the intent of evading the provisions of this act. e. Nothing in this section shall be construed to limit the substantive rights, remedies or procedural rights, including, but not limited to, recoupment rights under the common law, available to a borrower against any creditor, assignee or holder under any other law. The limitations on assignee liability in subsection b. of this section shall not apply to the assignee liability in subsections a., c. and d. of this section. L.2003,c.64,s.6; amended 2004, c.84, s.4.

N.J. Stat. § 46:10B-28 Enforcement by department.

7. a. The department shall conduct examinations and investigations and issue subpoenas and orders to enforce the provisions of this act with respect to a person licensed or subject to the provisions of the "New Jersey Residential Mortgage Lending Act," sections 1 through 39 of P.L.2009, c.53 (C.17:11C-51 et seq.). b. The department shall examine any instrument, document, account, book, record, or file of a person originating or brokering a high-cost home loan under this act. The department shall recover the cost of examinations from the person. A person originating or brokering high-cost home loans shall maintain its records in a manner that will facilitate the department in determining whether the person is complying with the provisions of this act and the regulations promulgated thereunder. The department shall require the submission of reports by persons originating or brokering high-cost home loans which shall set forth such information as the department shall require by regulation. c. In the event that a person fails to comply with a subpoena for documents or testimony issued by the department, the department may request an order from a court of competent jurisdiction requiring the person to produce the requested information. d. If the department determines that a person has violated the provisions of this act, the department may do any combination of the following that it deems appropriate: (1) Impose a civil penalty of up to $10,000 for each offense, 40% of which penalty shall be dedicated for and used by the department for consumer education through nonprofit organizations which can establish to the satisfaction of the department that they have sufficient experience in credit counseling and financial education. In determining the penalty to be assessed, the commissioner shall consider the following criteria: whether the violation was willful; whether the violation was part of a pattern and practice; the amount of the loan; the points and fees charged; the financial condition of the violator; and other relevant factors. The department may require the person to pay investigative costs, if any. (2) Suspend, revoke, or refuse to renew any license issued by the department. (3) Prohibit or permanently remove an individual responsible for a violation of this act from working in his present capacity or in any other capacity related to activities regulated by the department. (4) Order a person to cease and desist any violation of this act and to make restitution for actual damages to borrowers. (5) Pending completion of an investigation or any formal proceeding instituted pursuant to this act, if the commissioner finds that the interests of the public require immediate action to prevent undue harm to borrowers, the commissioner may enter an appropriate temporary order to be effective immediately and until entry of a final order. The temporary emergent order may include: a temporary suspension of the creditor's authority to make high-cost home loans under this act; a temporary cease and desist order; a temporary prohibition against a creditor transacting high-cost home loan business in this State, or such other order relating to high-cost home loans as the commissioner may deem necessary to prevent undue harm to borrowers pending completion of an investigation or formal proceeding. Orders issued pursuant to this section shall be subject to an application to vacate upon two days' notice, and a preliminary hearing on the temporary emergent order shall be held, in any event, within five days after it is issued, in accordance with the provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.). (6) Impose such other conditions as the department deems appropriate. e. Any person aggrieved by a decision of the department and who has a direct interest in the decision may appeal the decision of the department to the commissioner. The appeal shall be conducted in accordance with the provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.). f. The department may maintain an action for an injunction or other process against any person to restrain and prevent the person from engaging in any activity violating this act. g. A decision of the commissioner shall be a final order of the department and shall be enforceable in a court of competent jurisdiction. The department shall publish the final adjudication issued in accordance with this section, subject to redaction or modification to preserve confidentiality. h. The provisions of this section shall not limit the authority of the Attorney General from instituting or maintaining any action within the scope of the Attorney General's authority with respect to the practices prohibited under this act. L.2003, c.64, s.7; amended 2009, c.53, s.68; 2010, c.34, s.12.

N.J. Stat. § 46:10B-29 Violations, remedies, liability.

8. a. (1) Any violation of this act constitutes an unlawful practice under P.L.1960, c.39 (C.56:8-1 et seq.). Any borrower may seek damages under the provisions of section 7 of P.L.1971, c.247 (C.56:8-19) or subparagraph (a) of paragraph (1) of subsection b. of this section, but not both. (2) Notwithstanding any provision of P.L.2003, c.64 (C.46:10B-22 et seq.) or other law to the contrary, any borrower who asserts any defense, claim or counterclaim pursuant to subsection c. of section 6 of P.L.2003, c.64 (C.46:10B-27) may do so only in an individual capacity and may not assert that defense, claim or counterclaim in a class action. b. Except as provided in subsection a. of this section and, where applicable, subject to any limitation on the amounts recoverable against a holder or assignee pursuant to section 6 of this act, in addition to the remedies available to a borrower under P.L.1960, c.39 (C.56:8-1 et seq.) and without limiting those remedies: (1) Any person found by a preponderance of the evidence to have violated this act shall be liable to the borrower for the following: (a) For material violations, statutory damages equal to the finance charges agreed to in the home loan agreement, plus up to 10% of the amount financed; (b) Punitive damages, when the violation was malicious or reckless in appropriate circumstances as determined by the fact-finder; and (c) Costs and reasonable attorneys' fees. (2) A borrower may be granted injunctive, declaratory, and such other equitable relief as the court deems appropriate in an action to enforce compliance with this act. (3) The remedies provided in this section are not intended to be the exclusive remedies available to a borrower, nor must the borrower exhaust any administrative remedies provided under this act or any other applicable law before proceeding under this section. c. A creditor in a home loan who, when acting in good faith, fails to comply with the provisions of this act, will not be deemed to have violated this section if the creditor establishes that either: (1) Within 45 days of the loan closing, the creditor has made appropriate restitution to the borrower, and appropriate adjustments are made to the loan; or (2) Within 365 days of the loan closing and prior to receiving any notice from the borrower of the compliance failure, and the compliance failure was not intentional and resulted from a bona fide error notwithstanding the maintenance of procedures reasonably adopted to avoid such errors, the borrower is notified of the compliance failure, appropriate restitution is made to the borrower, and appropriate adjustments are made to the loan. Examples of bona fide errors include clerical, calculation, computer malfunction and programming, and printing errors. An error of legal judgment with respect to a person's obligations under this section is not a bona fide error. d. The remedies provided in this section are cumulative. L.2003,c.64,s.8; amended 2004, c.84, s.5.

N.J. Stat. § 46:10B-30 Rights, remedies, prohibitions declared additional, cumulative.

9. The rights, remedies, and prohibitions accorded by the provisions of this act are hereby declared to be in addition to and cumulative of any other right, remedy, or prohibition accorded by the common law or statutes of the United States or of this State, and nothing herein shall be construed to deny, abrogate, or impair any such common law or statutory right, remedy, or prohibition. Without limiting the foregoing, the rights, remedies and prohibitions accorded by the provisions of this act are hereby further declared to create no presumption that any home loan or any term in a home loan is not unconscionable, whether or not the home loan or loan term, alone or in conjunction with other terms of the loan, violates the provisions of this act. L.2003,c.64,s.9.

N.J. Stat. § 46:10B-31 Law of state of location of property applicable.

10. The law of the state in which the property is located shall be applied to all transactions governed by this act regardless of where those transactions originated. This act shall apply to all loans made or entered into after the effective date of this act. L.2003,c.64,s.10.

N.J. Stat. § 46:10B-32 Program of consumer counseling, awareness.

11. The Director of the Division of Banking in the Department of Banking and Insurance, in consultation with the Director of the Division of Consumer Affairs and the Division of Civil Rights in the Department of Law and Public Safety, shall develop and implement a program of consumer counseling and awareness designed to inform the public about the methods by which predatory creditors impose unconscionable and noncompetitive fees and charges as part of complex home mortgage transactions, to protect the public from incurring those fees and charges, and otherwise to encourage the informed and responsible use of credit. L.2003,c.64,s.11.

N.J. Stat. § 46:10B-33 Liability of mortgage broker.

12. Notwithstanding any provision of this act to the contrary, a mortgage broker shall be liable under the provisions of this act only for acts performed by the mortgage broker in the course of providing mortgage brokering services. However, a mortgage broker may be held liable for acts performed by the mortgage broker outside the scope of mortgage brokering services if the acts are related to the purchasing or the making of a home loan and are otherwise prohibited under this act. L.2003,c.64,s.12.

N.J. Stat. § 46:10B-34 Preemption of local rules, regulations.

13. No municipality, county or political subdivision thereof, shall enact an ordinance or resolution or promulgate any rules or regulations relating to this act. The provisions of any ordinance or resolution or rules or regulations of any municipality or county relative to abusive home loan lending practices are superseded by the provisions of this act. L.2003,c.64,s.13.

N.J. Stat. § 46:10B-35 Regulations.

14. The Commissioner of Banking and Insurance, in consultation and collaboration with the Director of the Division of Consumer Affairs in the Department of Law and Public Safety, shall promulgate regulations pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) necessary to effectuate the provisions of P.L.2003, c.64 (C.46:10B-22 et seq.). L.2003,c.64,s.14; amended 2004, c.84, s.6.

N.J. Stat. § 46:10B-36 Short title.

1. This act shall be known and may be cited as the "Save New Jersey Homes Act of 2008". L.2008, c.86, s.1.

N.J. Stat. § 46:10B-37 Findings, declarations relative to certain residential mortgages.

2. The Legislature finds and declares that: a. Many thousands of New Jersey homeowners are at risk of losing their homes as a result of mortgage foreclosures in the immediate future; b. Foreclosure of a family's home often represents the loss of the family's most valuable financial asset, and foreclosures undermine the health and economic vitality of neighborhoods; c. Foreclosures result in the loss of millions of dollars in assets, not only those of the homeowners who are the victims of foreclosure, but also in terms of the property values of homes located in the vicinity of foreclosed properties, as well as millions in additional costs to state and local government for the loss of property tax revenue; d. According to a report issued by the U.S. Government Accountability Office (GAO) in October 2007, New Jersey experienced an increase in residential mortgage foreclosure start rates in excess of 50% over the prior two years and the GAO found that defaults and foreclosures on mortgages have a significant economic impact on homeowners, lenders, and neighborhoods; e. According to a report issued in April 2008 by the State Foreclosure Prevention Working Group, which is composed of banking regulators and attorneys general of 11 states, the collective efforts of mortgage lenders and government officials to address rising foreclosures has not resulted in meaningful improvement in foreclosure prevention, and new approaches, such as targeted efforts to slow down the foreclosure process, are needed to prevent millions of unnecessary foreclosures nationwide; f. Foreclosures are largely the result of subprime lending practices, which have placed many homeowners in loans that they cannot realistically afford, by using mortgage loan features such as low introductory rates which reset to higher, variable rates, thereby increasing the risk of default for many homeowners in the State who, at an increasing rate, cannot sell their home or refinance their mortgage; g. Industry analysts estimate that, nationwide, about 1.5 million mortgages are due to reset in 2008, and that as many as three million subprime mortgages could end up in foreclosure over the next several years; and h. There is a compelling need for the State of New Jersey to address the ongoing economic crisis in the subprime mortgage market and to provide the means by which homeowners can obtain a period of extension to adjust their finances in order to increase their ability to retain their homes, encourage mortgage lenders to modify mortgage loan terms and resolve foreclosure disputes, and protect local governments and neighborhoods from the negative social, economic, and fiscal consequences of foreclosure and abandonment. L.2008, c.86, s.2.

N.J. Stat. § 46:10B-38 Definitions relative to certain residential mortgages.

3. As used in this act: "Creditor" means a State chartered bank, savings bank, savings and loan association or credit union, any person required to be licensed under the provisions of the "New Jersey Residential Mortgage Lending Act," sections 1 through 39 of P.L.2009, c.53 (C.17:11C-51 et seq.), and any entity acting on behalf of the creditor named in the debt obligation including, but not limited to, servicers. "Eligible borrower" means a borrower who is obligated to repay a loan secured by an introductory rate mortgage. "Eligible foreclosed borrower" means a borrower who is obligated to repay a loan secured by an introductory rate mortgage and who receives a notice of intention to foreclose that mortgage pursuant to the "Fair Foreclosure Act," P.L.1995, c.244 (C.2A:50-53 et al.), except that an "eligible foreclosed borrower" shall not include an eligible borrower who has previously exercised the right to obtain a three-year period of extension pursuant to section 5 of this act. "Full repayment" means the full repayment of the amounts due under the introductory rate mortgage, including, without limitation, upon the maturity date, a refinancing, or a sale of or other transfer of title to the property. "Fully indexed rate" means the sum of the current value of the index used for the adjustable rate mortgage and the margin disclosed in the loan agreement. "Introductory rate mortgage" means a consumer credit transaction in which the loan is secured by a mortgage on real estate in this State upon which there is located a one to four family dwelling which is occupied by the borrower as the borrower's principal residence, and which provides for: (1) an introductory payment rate option that is set at least 3 percent below the fully indexed rate at the time the loan was originated and payments may adjust by more than 3 percent at the reset date regardless of whether the variable rate index has increased; or (2) an interest rate that may adjust by more than 2 percent at the end of the initial fixed rate period of the loan and which, notwithstanding the payment rate in effect, had an interest rate at origination of more than 200 basis points over the Freddie Mac 30-year conventional interest rate and which provides for an introductory rate that is set below the fully indexed rate at the time the loan was originated and may adjust at the reset date regardless of whether the variable rate index has increased. "Introductory rate mortgage" shall not include: (1) a loan that provides for a fixed rate of interest for the first five years or longer; or (2) a loan that provides for an introductory rate that is set below the fully indexed rate at the time the loan was originated only as a result of the borrower's payment of bona fide discount points. L.2008, c.86, s.3; amended 2009, c.53, s.69

N.J. Stat. § 46:10B-39 Written notices from creditor to eligible borrower.

4. a. Prior to the date on which the interest rate in effect during the introductory period of an introductory rate mortgage resets to a variable interest rate under the terms of the mortgage, a creditor shall provide a series of written notices, separate and distinct from all other correspondence, to an eligible borrower. The creditor shall provide these notices at 60-day and 30-day intervals prior to the date that the introductory interest rate resets. b. Each notice required pursuant to subsection a. of this section shall include, in plain language and in at least 14 point bold type: (1) the current interest rate under the terms of the introductory rate mortgage; (2) the date on which the interest rate resets from a fixed interest rate applicable during the introductory period to a variable interest rate; (3) an explanation of how the reset interest rate and monthly payment would be determined; (4) the best estimate by the creditor of the amount of the monthly payment that will apply after the date of the reset, and the assumptions upon which the estimate is based; (5) a list of alternatives an eligible borrower may pursue before the date of the reset, including any refinancing of the loan offered by the creditor or any renegotiation of loan terms offered by the creditor; (6) an explanation of the borrower's right to obtain a period of extension prior to the initial interest rate reset of an introductory rate mortgage pursuant to this act and an explanation of the procedure that a borrower must follow to obtain a period of extension; and (7) a certification of extension form that can be completed by a borrower in order to obtain a period of extension authorized pursuant to section 5 of this act. L.2008, c.86, s.4.

N.J. Stat. § 46:10B-40 Period of extension; certification.

5. a. Notwithstanding any law or contract right to the contrary, prior to the initial interest rate reset of an introductory rate mortgage, a creditor shall provide an eligible borrower a period of extension for three years as provided in this section, during which the interest rate on the introductory rate mortgage shall not increase above the original introductory rate, provided the eligible borrower completes and returns a certification of extension to the creditor in accordance with the provisions of this section. b. In order to obtain the period of extension, the eligible borrower shall provide to the creditor, prior to the date that the interest rate resets under the terms of the introductory rate mortgage, a completed certification of extension form signed by the eligible borrower, which contains: (1) the name of the eligible borrower; (2) the address of the property; and (3) an affirmative statement that the eligible borrower: (a) does not have sufficient monthly income, after deductions for necessary living expenses, to pay the monthly payments that will apply after the date that the interest rate resets; (b) requests the period of extension; (c) agrees to continue, during the period of extension, monthly payments, which shall include principal and interest calculated at the introductory rate on the date that the introductory rate mortgage was originated, as well as amounts for taxes, insurance, and any other amounts being paid under the terms of the mortgage prior to the interest rate reset; (d) agrees to pay the creditor, at the time of the full repayment of the introductory rate mortgage, any interest deferred on account of the period of extension; (e) agrees to accept the creditor's placement of a modification of mortgage on the property to secure the repayment of the interest deferred on account of the period of extension; and (f) agrees to sign a modification of mortgage form that contains the terms of the period of extension and any documentation necessary to establish or record the modification of mortgage. c. An eligible borrower who makes a knowing material misrepresentation in a certification of extension is guilty of a crime of the fourth degree. d. The creditor, upon receiving the completed certification of extension, shall grant the eligible borrower the three-year period of extension, which shall commence on the date that the introductory rate is due to reset under the terms of the introductory rate mortgage. e. Within a reasonable amount of time after the receipt of a completed certification of extension from an eligible borrower, a creditor shall provide to the eligible borrower a written acknowledgment that the certification of extension has been received. The acknowledgment shall contain the following: (1) the monthly payment amount that is due from the eligible borrower during the period of extension, which shall include principal and interest, calculated at the introductory rate on the date the introductory rate mortgage was originated, as well as amounts for taxes, insurance, and any other amounts being paid under the terms of the mortgage prior to the interest rate reset; (2) a schedule of payments, indicating the date that the first monthly payment is due and the dates that each subsequent monthly payment is due during the period of extension; (3) the address to which the eligible borrower shall send the monthly payment; and (4) a statement of proposed modification of mortgage, which shall include: (a) a notice to the eligible borrower that the creditor will place a modification of mortgage on the property that is the security for the introductory rate mortgage, to secure the eligible borrower's repayment of the amount of interest deferred by the period of extension; and (b) an explanation of the method the creditor will use to calculate the amount of the interest deferred by the period of extension. f. (1) A creditor who grants a period of extension to an eligible borrower shall have the right to record a modification of mortgage on the eligible borrower's property in the public records in the county in which the property is located to secure the eligible borrower's repayment of the amount of interest deferred by the period of extension. The modification of mortgage shall be effective from the date that it is executed. Notwithstanding any law to the contrary, the modification of mortgage shall have the same priority as the lien of the introductory rate mortgage. Upon payment by the eligible borrower of the total amount of interest deferred pursuant to the period of extension, which shall only be due upon full repayment of the introductory rate mortgage, the creditor shall provide the eligible borrower with a recordable satisfaction of the modification of mortgage, or otherwise cause the modification of mortgage to be discharged of record. (2) If an eligible borrower fails to return to a creditor, who has a right to record a modification of mortgage pursuant to paragraph (1) of this subsection, a properly executed modification of mortgage or any other documentation necessary to establish or record the modification of mortgage, within 30 days from the borrower's receipt from the creditor of a modification of mortgage form, the creditor may record the eligible borrower's certification of extension in place of the modification of mortgage. Notwithstanding any other law to the contrary, the certification of extension shall have the same priority as the lien of the introductory rate mortgage. Upon payment by the eligible borrower of the total amount of interest deferred pursuant to the period of extension, the creditor shall provide the eligible borrower with a recordable satisfaction of the certification of extension, or otherwise cause the certification of extension to be discharged of record. g. A creditor shall not require an eligible borrower to limit or waive the rights of the borrower to bring any claims, defenses, demands, proceedings, actions, or causes of action against the creditor as a condition of accepting an offer of any loss mitigation activities made available by the "Save New Jersey Homes Act of 2008," P.L.2008, c.86 (C.46:10B-36 et seq.). h. An eligible borrower who has been granted a period of extension shall forfeit all rights concerning deferment of interest payments provided by this act if the eligible borrower fails to make payments under the schedule of payments set forth in the creditor's acknowledgment of the period of extension or fails to comply with the terms of any modification of mortgage entered into between the creditor and the eligible borrower relating to the period of extension, such that the modification of mortgage becomes 60 days delinquent. L.2008, c.86, s.5.

N.J. Stat. § 46:10B-41 Notice sent to eligible foreclosed borrower.

6. a. A creditor that issues to an eligible foreclosed borrower a notice of intention to foreclose an introductory rate mortgage pursuant to the "Fair Foreclosure Act," P.L.1995, c.244 (C.2A:50-53 et al.), shall send to the eligible foreclosed borrower a series of written notices, by regular and registered mail, separate and distinct from all other correspondence. The notices shall include in plain language and in at least 14 point bold type: (1) A statement that the information in the notice is being provided as required by the "Save New Jersey Homes Act of 2008," P.L.2008, c.86 (C.46:10B-36 et seq.), which was enacted by the New Jersey Legislature and which provides certain rights to borrowers whose homes are the subject of a mortgage foreclosure action; (2) A list of alternatives to foreclosure that an eligible foreclosed borrower may pursue, including any refinancing of the loan offered by the creditor and any renegotiation of loan terms offered by the creditor; (3) An explanation of the eligible foreclosed borrower's right to obtain a period of extension for three years pursuant to the "Save New Jersey Homes Act of 2008," P.L.2008, c.86 (C.46:10B-36 et seq.), and an explanation of the procedure that an eligible foreclosed borrower must follow to obtain a period of extension; (4) A statement that the notice should be read carefully and that the eligible foreclosed borrower may wish to consult with an attorney to understand the rights that may be available under the "Save New Jersey Homes Act of 2008," P.L.2008, c.86 (C.46:10B-36 et seq.); and (5) A certification of extension form that can be completed by an eligible foreclosed borrower in order to obtain the period of extension authorized pursuant to section 7 of this act. b. The notices required pursuant to subsection a. of this section shall be sent at the following intervals: (1) within 10 days of issuing the notice of intention; and (2) at the time that the creditor applies for entry of final judgment of foreclosure pursuant to section 6 of P.L.1995, c.244 (C.2A:50-58). c. The notices shall be sent in envelopes that state the following information on the outside front portion of the envelope: "The New Jersey Legislature has enacted the Save New Jersey Homes Act of 2008, which may help you save your home from foreclosure. Details as to the rights you may have to obtain a period of extension of foreclosure under this new law are contained within. Please read the contents carefully. You may wish to consult with an attorney to understand your rights under this new law." L.2008, c.86, s.6.

N.J. Stat. § 46:10B-42 Period of extension for eligible foreclosed borrower.

7. a. Notwithstanding any law or contract right to the contrary, a creditor shall provide an eligible foreclosed borrower a period of extension for three years as provided in this section, during which foreclosure proceedings pursuant to the "Fair Foreclosure Act," P.L.1995, c.244 (C.2A:50-53 et al.) shall be suspended and the eligible foreclosed borrower shall continue to pay monthly payments, which shall include principal and interest, calculated at the introductory rate on the date that the introductory rate mortgage was originated, as well as amounts for taxes, insurance, and any other amounts being paid under the terms of the mortgage prior to the interest rate reset, provided the eligible foreclosed borrower completes and returns a certification of extension to the creditor in accordance with the provisions of this section. b. In order to obtain the period of extension, the eligible foreclosed borrower shall provide to the creditor, no later than 90 days from the date that the creditor sends the notice required pursuant to paragraph (2) of subsection b. of section 6 of this act, a completed certification of extension form signed by the eligible foreclosed borrower, which contains: (1) the name of the eligible foreclosed borrower; (2) the address of the property; and (3) an affirmative statement that the eligible foreclosed borrower: (a) requests the period of extension; (b) agrees to continue, during the period of extension, monthly payments which shall include principal and interest, calculated at the introductory rate on the date that the introductory rate mortgage was originated, as well as amounts for taxes, insurance, and any other amounts being paid under the terms of the mortgage prior to the interest rate reset; (c) agrees to pay the creditor, at the time of full repayment of the introductory rate mortgage: (i) any interest deferred on account of the period of extension; (ii) any fees and costs incurred by the creditor in connection with the foreclosure proceeding; and (iii) any arrearages owed to the creditor for monthly principal and interest payments, homeowners insurance payments, property tax payments, and any other payments that the eligible foreclosed borrower was required to pay, but failed to pay, under the terms of the introductory rate mortgage; (d) agrees to accept the creditor's placement of a modification of mortgage on the property to secure the repayment of amounts owed pursuant to subparagraph (c) of this paragraph; and (e) agrees to sign a modification of mortgage form that contains the terms of the period of extension and any documentation necessary to establish or record the modification of mortgage. c. The creditor, upon receiving the completed certification of extension within the time period specified in subsection b. of this section, shall: (1) grant the eligible foreclosed borrower the three-year period of extension, which shall commence no later than 30 days from the date that the creditor receives the eligible foreclosed borrower's completed certification of extension; and (2) suspend the foreclosure proceeding that the creditor initiated pursuant to the "Fair Foreclosure Act," P.L.1995, c.244 (C.2A:50-53 et al.). A creditor may grant relief pursuant to paragraphs (1) and (2) of this subsection, upon receipt of a completed certification of extension from an eligible foreclosed borrower after the time period specified in subsection b. of this section, in the sole discretion of the creditor. d. Within a reasonable period of time after the receipt of a completed certification of extension from an eligible foreclosed borrower within the time period specified in subsection b. of this section, a creditor shall provide to the eligible foreclosed borrower a written acknowledgment that the certification of extension has been received. The acknowledgment shall contain the following: (1) a statement that the foreclosure proceeding initiated pursuant to the "Fair Foreclosure Act," P.L.1995, c.244 (C.2A:50-53 et al.) will be suspended during the period of extension; (2) the monthly payment amount that is due from the eligible foreclosed borrower during the period of extension, which shall include principal and interest, calculated at the introductory rate, on the date the introductory mortgage rate was originated, as well as amounts for taxes, insurance, and any other amounts being paid under the terms of the mortgage prior to the interest rate reset; (3) a schedule of payments, indicating the date that the first monthly payment is due and the dates that each subsequent monthly payment is due during the period of extension; (4) the address to which the eligible foreclosed borrower shall send the monthly payment; and (5) a statement of proposed modification of mortgage, which shall include: (a) a notice to the eligible foreclosed borrower that the creditor will place a modification of mortgage on the property that is the security for the introductory rate mortgage, to secure the eligible foreclosed borrower's repayment of the amounts provided for in paragraph (1) of subsection e. of this section; and (b) an explanation of the method the creditor will use to calculate the amount of the interest deferred by the period of extension, and the amounts provided for in paragraph (1) of subsection e. of this section, for which repayment is secured by the modification of mortgage. e. (1) A creditor that grants a period of extension to an eligible foreclosed borrower shall have the right to record a modification of mortgage on the eligible foreclosed borrower's property to secure the eligible foreclosed borrower's repayment of: (a) the amount of interest deferred by the period of extension; (b) any fees and costs already incurred in connection with the foreclosure proceeding; and (c) any arrearages owed to the creditor for monthly payments of principal and interest, homeowner insurance payments, property tax payments, or any other payments that the eligible foreclosed borrower was required to pay, but failed to pay, under the terms of the introductory rate mortgage. (2) The modification of mortgage shall be effective from the date that it is executed. Notwithstanding any other law to the contrary, the modification of mortgage shall have the same priority as the lien of the introductory rate mortgage. Upon payment by the eligible foreclosed borrower of the total amount of interest deferred pursuant to the period of extension, and any other amounts representing the arrearages for which the modification of mortgage secures repayment pursuant to this act, which shall only be due upon full repayment of the introductory rate mortgage, the creditor shall provide the eligible foreclosed borrower with a recordable satisfaction of the modification of mortgage, or otherwise cause the modification of mortgage to be discharged of record. (3) If an eligible foreclosed borrower fails to return to a creditor, who has a right to record a modification of mortgage pursuant to paragraph (1) of this subsection, a properly executed modification of mortgage or any other documentation necessary to establish or record the modification of mortgage within 30 days from the borrower's receipt from the creditor of a modification of mortgage form, the creditor may record the eligible foreclosed borrower's certification of extension in place of the modification of mortgage. Notwithstanding any other law to the contrary, the certification of extension shall have the same priority as the lien of the introductory rate mortgage. Upon payment by the eligible foreclosed borrower of the total amount of interest deferred pursuant to the period of extension, and any other amounts representing the arrearages for which the certification of extension secures repayment pursuant to this act, the creditor shall provide the eligible foreclosed borrower with a recordable satisfaction of the certification of extension, or otherwise cause the certification of extension to be discharged of record. f. A creditor shall not require an eligible foreclosed borrower to limit or waive the rights of the borrower to bring any claims, defenses, demands, proceedings, actions, or causes of action against the creditor as a condition of accepting an offer of any loss mitigation activities made available by the "Save New Jersey Homes Act of 2008," P.L.2008, c.86 (C.46:10B-36 et seq.). g. An eligible foreclosed borrower who has been granted a period of extension shall forfeit all rights concerning deferment of interest payments, suspension of foreclosure, and deferment of payment of amounts secured by a modification of mortgage, provided by the provisions of this act if the eligible foreclosed borrower fails to make payments under the schedule of payments as set forth in the creditor's acknowledgment of the period of extension or fails to comply with the terms of the modification of mortgage entered into between the creditor and the eligible foreclosed borrower relating to the period of extension, such that the modification of mortgage becomes 60 days delinquent. h. A court shall not approve an entry of final judgment in a foreclosure proceeding commenced pursuant to the "Fair Foreclosure Act," P.L.1995, c.244 (C.2A:50-53 et al.) as to an introductory rate mortgage unless the court is satisfied from the pleadings and certifications on file with the court that notice of the availability of the period of extension was provided to the eligible foreclosed borrower in accordance with the provisions of this act. L.2008, c.86, s.7.

N.J. Stat. § 46:10B-43 Violations, penalties.

8. a. Any person who willfully violates any provision of this act shall be liable to a penalty of not more than $10,000 for the first offense, and not more than $20,000 for the second and subsequent offense, which penalty may be collected in a summary proceeding pursuant to the "Penalty Enforcement Law of 1999," P.L.1999, c.274 (C.2A:58-10 et seq.), except that immaterial errors in a notice required to be provided by a creditor pursuant to this act, shall not constitute a violation of this act. b. If a creditor violates any provision of this act, an eligible borrower, an eligible foreclosed borrower, or the Attorney General may bring an action to enforce compliance by a summary proceeding pursuant to the "Penalty Enforcement Law of 1999," P.L.1999, c.274 (C.2A:58-10 et seq.). L.2008, c.86, s.8.

N.J. Stat. § 46:10B-44 Creditor's failure to fulfill obligation.

9. Failure of a creditor to fulfill any obligation under this act shall not be considered to be the exercise of a power, right, benefit, or privilege under the parity provisions of P.L.1981, c.163 (C.17:9A-24b1), section 48 of P.L.1963, c.144 (C.17:12B-48), or section 12 of P.L.1984, c.171 (C.17:13-90), and it shall not be a defense to a violation of this act that the failure to fulfill any provision of the act is an exercise of such a power, right, benefit, or privilege. L.2008, c.86, s.9.

N.J. Stat. § 46:10B-45 Liberal construction.

10. This act shall be liberally construed to effectuate the purposes of the act. L.2008, c.86, s.10.

N.J. Stat. § 46:10B-46 Severability.

11. If any section, subsection, paragraph, sentence or other part of this act is adjudged unconstitutional or invalid, the judgment shall not affect, impair or invalidate the remainder of this act, but shall be confined in its effect to the section, subsection, paragraph, sentence or other part of this act directly involved in the controversy in which the judgment shall have been rendered. L.2008, c.86, s.11.

N.J. Stat. § 46:10B-47 Regulations.

12. The Attorney General, in consultation with the Department of Banking and Insurance shall adopt regulations, pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) to effectuate the purposes of this act. L.2008, c.86, s.12.

N.J. Stat. § 46:10B-48 Effective date; term.

13. This act shall take effect immediately, and remain in effect until January 1, 2011. L.2008, c.86, s.13.

N.J. Stat. § 46:10B-49 Report of mortgage foreclosure actions.

15. a. (1) Except as provided in paragraph (2) of this subsection, a creditor that institutes a mortgage foreclosure action in the Superior Court of New Jersey shall report to the Department of Banking and Insurance, on a quarterly basis and on a form promulgated by the department, information about the number of mortgage foreclosure actions filed by the creditor in the State. (2) When a creditor or other person is required by any Rule of Court or otherwise by law to file electronically with the Superior Court of New Jersey pleadings in an action to foreclose on a mortgage, and the Administrative Office of the Courts is capable of collecting and transmitting the data set forth in paragraphs (1) through (8) of subsection b. of this section in electronic form, the creditor or other person shall transmit the data to the Superior Court, in a manner prescribed by the Superior Court, as part of the pleadings in an action to foreclose a mortgage. The Administrative Office of the Courts shall collect the electronically submitted data and transmit it to the Department of Banking and Insurance, which shall produce and make available on its website quarterly reports, as set forth in subsection b. of this section. b. The Department of Banking and Insurance shall produce a report, on a quarterly basis, detailing information about mortgage foreclosures filed by creditors in each county of the State, and shall make the report available to the public on its website. The report shall describe the type of mortgage being foreclosed on based on the following categories: (1) prime rate mortgages foreclosed upon; (2) subprime rate mortgages foreclosed upon; (3) fixed rate mortgages foreclosed upon; (4) adjustable rate mortgages foreclosed upon; (5) nonconforming mortgages, as defined by Fannie Mae, Freddie Mac, or their successors; (6) mortgages insured by the Federal Housing Administration foreclosed upon; (7) mortgages insured by the Veteran's Administration foreclosed upon; and (8) any other category of classification the department deems appropriate to effectuate the purpose of this section. c. The Department of Banking and Insurance, pursuant to the "Administrative Procedure Act," P.L.1986, c.410 (C.52:14B-1 et seq.) shall adopt regulations necessary to effectuate the purpose of this section. Following the enactment of P.L.2009, c.296 (C.2A:50-69 et al.), the department, in consultation with the Administrative Office of the Courts, shall adopt regulations necessary to effectuate the purpose of this section. L.2008, c.127, s.15; amended 2009, c.296, s.4.

N.J. Stat. § 46:10B-49.1 Database reflecting extent of residential properties under foreclosure.

1. a. The Department of Community Affairs shall produce a database that details the extent to which residential properties in this State are under foreclosure pursuant to the "Fair Foreclosure Act," P.L.1995, c.244 (C.2A:50-53 et seq.). The department shall develop, maintain, and update the database based upon information submitted to the department by residential mortgage lenders pursuant to section 2 of P.L.2019, c.134 (C.46:10B-49.2), and information obtained from any other public sources. b. The database shall contain: (1) The address of each residential property under foreclosure and the county, municipality, lot and block number; (2) the current owner of record; and (3) the date the notice of intention to foreclose was sent to the residential mortgage debtor by registered or certified mail, return receipt requested. c. The database shall be considered confidential and shall be used only by the department, the county clerks, the county registers of deeds and mortgages, the county sheriffs, the Administrative Office of the Courts and such other agencies as the Commissioner of Community Affairs designates, except that a municipality shall have access to the database only with respect to information pertaining to the geographical area within the municipality's jurisdiction. The database shall not be subject to public access, inspection or copying pursuant to P.L.1963, c.73 (C.47:1A-1 et seq.) or the common law concerning access to public records. d. The Commissioner of Community Affairs may adopt rules and regulations, pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), to effectuate the provisions of P.L.2019, c.134 (C.46:10B-49.1 et al.). L.2019, c.134, s.1.

N.J. Stat. § 46:10B-49.2 Notice of intention to foreclose, centralized portal for submission.

2. a. A residential mortgage lender shall provide to the Department of Community Affairs the notice of intention to foreclose required pursuant to section 4 of P.L.1995, c.244 (C.2A:50-56) and a description of the subject property by street address, block, and lot as shown on the municipal tax map at the time the notice is given to the residential mortgage debtor. Upon receipt of the notice of intention to foreclose pursuant to this section, the Department of Community Affairs shall provide the residential mortgage lender with a written acknowledgement of the department's receipt of the notice of intention to foreclose. Compliance with this section shall be set forth in the pleadings of any legal action referred to in section 4 of P.L.1995, c.244 (C.2A:50-56). b. The Department of Community Affairs shall create a centralized portal allowing for electronic submittal of the notice of intention to foreclose as required pursuant to subsection a. of this section. L.2019, c.134, s.2.

N.J. Stat. § 46:10B-49.3 Required notifications by lender.

3. A residential mortgage lender that serves a summons and complaint in an action to foreclose on a mortgage on a residential property in this State pursuant to the "Fair Foreclosure Act," P.L.1995, c.244 (C.2A:50-53 et seq.), shall, within 10 days of serving the summons and complaint, notify the Department of Community Affairs, the municipal clerk, the municipal tax collector, and the chief of police in the municipality in which the property is located, and all public utilities as defined in R.S.48:2-13 which provide services in the municipality in which the property is located, and the county executive in the county in which the property is located, that a summons and complaint in an action to foreclose on a mortgage has been filed against the property. L.2019, c.134, s.3.

N.J. Stat. § 46:10B-50 Six-month forbearance period before foreclosure; definitions.

16. a. (1) A creditor that files and serves, pursuant to the "Fair Foreclosure Act," P.L.1995, c.244 (C.2A:50-53 et al.), a summons and complaint of foreclosure on a high risk mortgage loan, shall grant the borrower a six-month period of forbearance, upon written request of the borrower, to pursue a loan workout, loan modification, refinancing, or other alternative through the Judiciary's Foreclosure Mediation Program, where eligible, or another form of mediation or settlement discussion. During the six-month forbearance period, the interest rate on the high risk mortgage loan shall not increase and the creditor shall take no further action to pursue foreclosure of the property. Nothing in this subsection shall constitute a limitation on the ability of the creditor and borrower to participate in the Judiciary's Foreclosure Mediation Program or another form of mediation or settlement discussion, or enter into an agreement as a result of that mediation. As used in this section: "Forbearance" means a period of six months during which the creditor shall suspend all efforts to advance any judicial foreclosure proceedings filed by the creditor against the borrower. "High Risk Mortgage" means the first mortgage loan that has one or more of the following characteristics: is an interest only mortgage with a future interest reset rate; has a reset mortgage interest rate that increases the initial interest rate by two or more percentage points; contains a payment option plan or a "pick a payment" plan; contains a negative amortization schedule; is a subprime mortgage, which means a consumer credit transaction, secured by the consumer's principal dwelling, with an annual percentage rate that exceeds the average prime offer rate for a comparable transaction, as of the date the interest rate is set, by 1.5 or more percentage points for loans secured by a first lien on a dwelling, or by 3.5 or more percentage points for loans secured by a subordinate lien on a dwelling; contains an enforceable prepayment penalty; or is a high cost home loan as defined in section 3 of the "New Jersey Home Ownership Security Act of 2002," P.L.2003, c.64 (C.46:10B-24). (2) Upon serving the summons and complaint in a foreclosure action, the creditor shall notify the borrower of the borrower's right to forbearance as provided for in this section, and, upon receipt of written request by the borrower, within 30 days of the receipt of the summons and complaint, the creditor shall grant the borrower a six-month period of forbearance, beginning on the date the creditor receives the borrower's request. (3) The notice of the borrower's right to forbearance shall include the following information: (a) whether the loan being foreclosed upon is eligible to receive forbearance; (b) that the borrower has the right to request the period of forbearance in writing no later than 30 days after receipt of the summons and complaint; (c) the full address and other contact information to which the request for forbearance may be sent. (4) Upon receipt of a request for forbearance, the creditor shall: (a) suspend all efforts, during the forbearance period, to advance any judicial proceeding in furtherance of the foreclosure action; and (b) notify the court that a forbearance has been granted with the dates that the forbearance period will begin and end. Nothing herein shall preclude the creditor and borrower from participating in mediation or settlement discussions, including the Judiciary's Foreclosure Mediation Program. b. When a forbearance period is granted by the creditor pursuant to subsection a. of this section, the borrower and creditor shall participate in the Judiciary's Foreclosure Mediation Program, where eligible, or another form of mediation or settlement discussion; provided, however, that the inability of the borrower to participate in mediation as a result of circumstances beyond the borrower's control shall not affect the borrower's continued eligibility for forbearance. c. If the borrower ceases to occupy the property at any time during the period of forbearance under this section, or if the borrower affirmatively advises the creditor, in writing, that the borrower will not participate in the Judiciary's Foreclosure Mediation Program or another form of mediation or settlement discussion, the creditor shall notify the court, and upon notification, and approval of the court, the period of forbearance shall be deemed to have ended. d. The provisions of this section shall expire two years following the effective date of P.L.2009, c.84; provided, however, that a forbearance period shall continue for its entire six-month period notwithstanding the expiration of this section. L.2008, c.127, s.16; amended 2009, c.84, s.1.

N.J. Stat. § 46:10B-51 Procedure for serving summons and complaint in action to foreclose on a mortgage.

17. a. (1) A creditor serving a summons and complaint in an action to foreclose on a mortgage on residential property in this State shall, within 10 days of serving the summons and complaint, notify the municipal clerk and the mayor or other chief executive officer of the municipality in which the property is located that a summons and complaint in an action to foreclose on a mortgage has been filed against the subject property. The notice shall contain the full name, address, and telephone number for the representative of the creditor who is responsible for receiving complaints of property maintenance and code violations and the full name and contact information for any person or entity retained by the creditor or a representative of the creditor to be responsible for any care, maintenance, security or upkeep of the property. The notice may contain information about more than one property, and shall be provided by mail or electronic communication, at the discretion of the municipal clerk. In the event the creditor that has served a summons and complaint in an action to foreclose on a residential property is located out-of-State, the notice shall also contain the full name, address, and telephone number of an in-State representative or agent who shall be responsible for the care, maintenance, security, and upkeep of the exterior of the property if it becomes vacant and abandoned. If the municipality has appointed a public officer pursuant to P.L.1942, c.112 (C.40:48-2.3 et seq.), the municipal clerk shall forward a copy of the notice to the public officer or shall otherwise provide it to any other local official responsible for administration of any property maintenance or public nuisance code. In the event that the property being foreclosed on is an affordable unit pursuant to the "Fair Housing Act," P.L.1985, c.222 (C.52:27D-301 et al.), then the creditor shall identify that the property is subject to the "Fair Housing Act." The notice shall also include the street address, lot and block number of the property, and the full name, address, and telephone number of an individual located within the State who is authorized to accept service on behalf of the creditor. The notice shall be provided to the municipal clerk and the mayor or other chief executive officer within 10 days of service of a summons and complaint in an action to foreclose on a mortgage against the subject property. If there is any change in the name, address, or telephone number for a representative, agent, or individual authorized to accept service on behalf of a creditor required to be provided in a notice pursuant to this paragraph following the filing of the summons and complaint, the creditor shall provide a notice to the applicable municipal clerk containing the updated name, address, or telephone number within 10 days of the change in that information. (2) Within 30 days following the effective date of P.L.2009, c.296 (C.2A:50-69 et al.), any creditor that has initiated a foreclosure proceeding on any residential property which is pending in Superior Court shall provide to the municipal clerk of the municipality in which the property is located, a listing of all residential properties in the municipality for which the creditor has foreclosure actions pending by street address and lot and block number. If the municipality has appointed a public officer pursuant to P.L.1942, c.112 (C.40:48-2.3 et seq.), the municipal clerk shall forward a copy of the notice to the public officer, or shall otherwise provide it to any other local official responsible for administration of any property maintenance or public nuisance code. b. If the owner of a residential property vacates or abandons any property on which a foreclosure proceeding has been initiated or if a residential property becomes vacant at any point subsequent to the creditor's filing the summons and complaint in an action to foreclose on a mortgage against the subject property, but prior to vesting of title in the creditor or any other third party, and the exterior of the property is found to be a nuisance or in violation of any applicable State or local code, the local public officer, municipal clerk, or other authorized municipal official shall notify the creditor or the representative or agent of an out-of-State creditor, as applicable, which shall have the responsibility to abate the nuisance or correct the violation in the same manner and to the same extent as the title owner of the property, to such standard or specification as may be required by State law or municipal ordinance. The municipality shall include a description of the conditions that gave rise to the violation with the notice of violation and shall provide a period of not less than 30 days from the creditor's receipt of the notice for the creditor to remedy the violation. If the creditor fails to remedy the violation within that time period, the municipality may impose penalties allowed for the violation of municipal ordinances pursuant to R.S.40:49-5. c. If the municipality expends public funds in order to abate a nuisance or correct a violation on a residential property in situations in which the creditor was given notice pursuant to the provisions of subsection b. of this section but failed to abate the nuisance or correct the violation as directed, the municipality shall have the same recourse against the creditor as it would have against the title owner of the property, including but not limited to the recourse provided under section 23 of P.L.2003, c.210 (C.55:19-100). d. A creditor that institutes a foreclosure proceeding on residential property pursuant to the "Fair Foreclosure Act," P.L.1995, c.244 (C.2A:50-53 et seq.), shall file with the summons and complaint in Superior Court, and with the lis pendens filed with the office of the county clerk or register of deeds and mortgages, the following information: (1) the full name, address, and telephone number for the representative of the creditor and any servicer who is responsible for receiving complaints of property maintenance and code violations pursuant to subsection b. of this section; (2) if the creditor or servicer is located out-of-State, the full name, address, and telephone number of an in-State representative or agent who shall be responsible for the care, maintenance, security, and upkeep of the property if it becomes vacant and abandoned ; and (3) if there is any change in the information required to be filed pursuant to paragraph (1) or (2) of this subsection following the filing of the summons and complaint or the lis pendens, the updated name, address, or telephone number, to be filed with the Superior Court, the office of the county clerk or register of deeds and mortgages, and all other parties, within 10 days of the change in that information. L.2008, c.127, s.17; amended 2009, c.296, s.5; 2014, c.5, s.1; 2014, c.35, s.2; 2019, c.66, s.2.

N.J. Stat. § 46:10B-51.1 Certain owners of foreclosed property required to file contact information.

1. The owner of any non-owner occupied residential property who takes title to the property as the result of a sheriff's sale or deed in lieu of foreclosure shall provide notice, within 10 business days, to the municipal clerk, or any other designated municipal official, of the municipality wherein the property is located, and to any association or common interest community, of which the residential property is a part, governed by the "Horizontal Property Act," P.L.1963, c.168 (C.46:8A-1 et seq.), the "Condominium Act," P.L.1969, c.257 (C.46:8B-1 et seq.), or "The Planned Real Estate Development Full Disclosure Act," P.L.1977, c.419 (C.45:22A-21 et seq.), providing the name and address of the owner. If the owner is not located within New Jersey, then the owner shall designate an agent within New Jersey, including the agent's address, who is authorized to accept service of process on behalf of the property owner. L.2011, c.222, s.1; amended 2021, c.20.

N.J. Stat. § 46:10B-53 Short title.

1. This act shall be known and may be cited as the "Foreclosure Rescue Fraud Prevention Act." L.2011, c.146, s.1.

N.J. Stat. § 46:10B-54 Definitions relative to certain mortgage foreclosure consultant practices.

2. As used in this act: "Business day" means any day other than a Saturday, Sunday, or a federal holiday. "Conventional mortgage rate" means the highest mortgage rate published for the relevant loan product on the website of any generally accepted industry provider of such information, applicable to the week preceding the transaction. "Distressed property" means residential real property consisting of from one to four dwelling units, at least one of which is occupied by the owner as a primary residence, and which is the subject of a mortgage foreclosure proceeding or whose owner is more than 90 days delinquent on any loan that is secured by the property. "Distressed property purchaser" means a person who acquires an interest in a distressed property through a distressed property conditional conveyance or a distressed property conveyance, or a person who participates in a joint venture or joint enterprise involving a distressed property conditional conveyance or a distressed property conveyance. The term "distressed property purchaser" does not mean a federally insured financial institution or a person who acquires distressed property through a deed in lieu of foreclosure or a person acting in participation with any person who acquires distressed property through a deed in lieu of foreclosure, provided that person does not promise to convey an interest in fee back to the owner or does not give the owner an option to purchase the property at a later date. "Distressed property conditional conveyance" means a transaction involving any participation by, or any distressed property service or other service or other assistance provided by, a foreclosure consultant in which an owner transfers an interest in fee, or a beneficial interest created through a trust document, in the distressed property; the acquirer of the property allows the owner to occupy the property; and the acquirer of the property or a person acting in participation with the acquirer of the property conveys or promises to convey an interest in fee back to the owner or gives the owner an option to purchase the property at a later date. "Distressed property conveyance" means a transaction involving any participation by, or any distressed property service or other service or other assistance provided by, a foreclosure consultant in which an owner transfers an interest in fee in a distressed property. "Distressed property relief" or "relief" means, in connection with a foreclosure consultant, any of the following: (1) saving the owner's property from foreclosure; (2) postponing the foreclosure sale; (3) obtaining a forbearance from the mortgagee; (4) securing the right to exercise the right to reinstatement; (5) obtaining an extension of the period within which the owner may reinstate his or her mortgage obligation; (6) obtaining a waiver of an acceleration clause; (7) obtaining a modification of a mortgage; (8) assisting the owner in obtaining a loan or advance of funds; or (9) avoiding the impairment of the owner's credit. "Distressed property service" or "service" means, without limitation, in connection with a distressed property conditional conveyance or a distressed property conveyance, any of the following: (1) debt, budget, or financial counseling of any type; (2) receiving money for the purpose of distributing it to creditors in payment or partial payment of any obligation secured by a mortgage or other lien on a distressed property; (3) contacting creditors on behalf of an owner; (4) arranging or attempting to arrange for an extension of the period within which the owner may cure the owner's default and reinstate a debt obligation; (5) arranging or attempting to arrange for a delay or postponement of the time of sale of the distressed property; (6) advising with respect to the filing of any document or assisting in any manner in the preparation of any document for filing with any court; or (7) giving advice, explanation, or instruction to an owner that in any manner relates to the cure of a default or forfeiture or to the postponement or avoidance of a sale of the distressed property. "Foreclosure consultant": (1) means any person, located out-of-State or within the State, who, directly or indirectly, for compensation from an owner, makes any solicitation, representation, or offer to perform, or who performs, any distressed property service that the person represents will in any manner do any of the following in relation to the owner's distressed property: (a) prevent or postpone the foreclosure sale of the property; (b) obtain any forbearance from any mortgagee; (c) assist the owner in exercising any right of reinstatement or right of redemption; (d) obtain any extension of the period within which the owner may reinstate the owner's rights with respect to the property; (e) obtain any waiver of an acceleration clause contained in any promissory note, contract, or mortgage evidencing or securing a debt in relation to the property; (f) assist the owner in obtaining a loan or advance of funds to pay off the promissory note, contract, or mortgage evidencing or securing a debt in relation to the property; or (g) avoid or ameliorate the impairment of the owner's credit resulting from default on the promissory note, contract, or mortgage, or the conduct of a foreclosure sale or offer to repair the owner's credit. (2) shall not include any of the following: (a) a housing counseling agency contracted by the United States Department of Housing and Urban Development to provide counseling; (b) a person who holds or is owed an obligation secured by a lien on any distressed property in situations in which the person performs services in connection with the obligation or lien, provided the obligation or lien did not arise as the result of, or as part of, a proposed distressed property conditional conveyance or a distressed property conveyance; (c) a person licensed to practice law in this State while acting under the authority of that license; (d) a nonprofit, charitable entity qualified pursuant to section 501(c)(3) of the Internal Revenue Code of 1986 (26 U.S.C. s.501(c)(3)), which is licensed pursuant to P.L.1979, c.16 (C.17:16G-1 et seq.); (e) a municipality which has a tax lien on distressed property; (f) an assignee or a purchaser of a municipal tax lien from a tax sale; (g) a sponsor which is certified by the Commissioner of Community Affairs to participate in the "New Jersey Housing Assistance and Recovery Program" established pursuant to sections 8 through 14 of P.L.2008, c.127 (C.55:14K-88 et seq.); (h) a bank, savings bank, savings and loan association, credit union, or other federally insured financial institution, or insurance company, or affiliate or subsidiary thereof, organized, chartered, licensed, or holding a certificate of authority to do business under the laws of this State or any other state or under the laws of the United States; (i) a person licensed as a real estate broker, broker-salesperson, or salesperson pursuant to R.S.45:15-1 et seq., while acting under the authority of that license; (j) a person licensed as a title insurance producer pursuant to the "New Jersey Insurance Producer Licensing Act of 2001," P.L.2001, c.210 (C.17:22A-26 et seq.) while acting under the authority of that license or conducting the business of title insurance pursuant to P.L.1975, c.106 (C.17:46B-1 et seq.); (k) a mediator licensed pursuant to the Judiciary's Foreclosure Mediation Program; or (l) a person licensed pursuant to the "New Jersey Residential Mortgage Lending Act," P.L.2009, c.53 (C.17:11C-51 et seq.), while acting under the authority of that license. "Owner" means an owner of record of title to a distressed property. "Owner's current verified monthly income" means the monthly average of the owner's most recent six months of wage receipts or pay stubs or if the owner has non-wage income by a verified statement of profit and loss or income from a certified public accountant who has reviewed the owner's income. "Reasonable ability to pay" means that the owner's current verified monthly income is adequate to service a 30-year fixed rate loan at the conventional mortgage rate together with actual property taxes, homeowner's insurance, condominium or association fees, if applicable, and reasonable and necessary living expenses. "Reasonable and necessary living expenses" means not less than the average utility costs over the last twelve months, or if that figure is unavailable $200, and transportation, food, clothing, and other expenses equal to an amount not less than the Collection Financial Standards set forth by the Internal Revenue Service for transportation, food, clothing, and other items and out-of-pocket health care costs. "Residual income" means an owner's net income available to meet living expenses after the payment of all ordinary and necessary debt, including payments under an option to purchase back the owner's property transferred in a distressed property conditional conveyance. L.2011, c.146, s.2.

N.J. Stat. § 46:10B-55 Requirements for licensure of foreclosure consultant.

3. a. A foreclosure consultant shall not conduct any business in this State until the foreclosure consultant: (1) (a) Obtains a license from the Commissioner of Banking and Insurance by filing an application form to be prescribed by the commissioner by regulation. As to licensure by a business entity, the application shall be accompanied by documentation establishing the business entity, including incorporation documents, if the entity is incorporated. (b) The application shall be accompanied by a reasonable fee, as established by the commissioner by regulation. (c) A person required to be licensed under this act shall file an amendment to their application within 20 days after any change in the information required to be included in the application. (d) Licenses issued pursuant to this section shall expire biennially and may be renewed upon submission of a renewal application to the department; (2) obtains a bond from a surety company authorized to do business in the State in a form and an amount to be prescribed by the commissioner by regulation, files the bond with the commissioner, and obtains written approval of the bond from the commissioner; (3) submits to the commissioner the name, address, fingerprints and written consent for a criminal history record background check to be performed on any officer, director, partner or owner of a controlling interest, or any employee engaged in mortgage foreclosure consulting activities, of the foreclosure consultant. The commissioner is authorized to exchange fingerprint data with and receive criminal history record information from the State Bureau of Identification in the Division of State Police and the Federal Bureau of Investigation consistent with applicable State and federal laws, rules and regulations. This information shall be collected for the purposes of facilitating determinations concerning licensure eligibility for the foreclosure consultant, based upon any findings related to an employee engaged in mortgage foreclosure consultant activities, officer, director, partner or owner. The applicant shall bear the cost for the criminal history record background check, including all costs of administering and processing the check. The Division of State Police shall promptly notify the commissioner in the event an employee engaged in mortgage foreclosure consultant activities, officer, director, partner or owner of the foreclosure consultant, who was the subject of a criminal history record background check pursuant to this section, is arrested for a crime or offense in this State after the date the background check was performed, whether the foreclosure consultant is a prospective new applicant, or subsequently, a current licensee; and (4) provides the name and street address of an agent in the State of New Jersey for service of process. b. The commissioner may refuse to issue or renew, and may revoke, any license: (1) for failure to comply with, or violation of, the provisions of this act or for any other good cause shown within the meaning and purpose of this act. A refusal or revocation shall not be made except upon reasonable notice to, and opportunity to be heard by, the applicant or licensee; or (2) upon proof that the applicant or licensee has been convicted of any crime of moral turpitude or any crime relating adversely to the activity regulated by this act. For purposes of this subsection, a plea of guilty, non vult, nolo contendere or any other such disposition of alleged criminal activity shall be deemed a conviction. c. A person who is licensed as a foreclosure consultant pursuant to this act shall not be subject to the provisions of P.L.1979, c.16 (C.17:16G-1 et seq.) while acting under the authority of this act. d. A person shall not present himself to the public as a licensed foreclosure consultant or use the designation "foreclosure consultant," "foreclosure consultant specialist," or similar designation without obtaining a license pursuant to this act. L.2011, c.146, s.3.

N.J. Stat. § 46:10B-56 Foreclosure consultant contract.

4. a. A foreclosure consultant contract shall be written in plain language and shall fully disclose the exact nature of the foreclosure consultant's services to be performed, the foreclosure consultant's representations, the distressed property relief to be secured, and the total amount and terms of compensation. b. The following notice, printed in at least 14-point boldface type, if the contract is printed, or in capital letters, if the contract is typed, and completed with the name of the foreclosure consultant, shall be printed immediately above the statement required by subsection c. of this section: "NOTICE REQUIRED BY NEW JERSEY LAW .........................................(Name) or anyone working for him or her CANNOT: (1) Take any money from you or ask you for money until .........................................(Name) has completely finished doing everything he or she said would be done; or (2) Ask you to sign or have you sign any lien, mortgage, or deed unless all provisions of the "Foreclosure Rescue Fraud Prevention Act," P.L.2011, c.146 (C.46:10B-53 et al.), and any other applicable federal and State laws have been complied with. (3) Guarantee that they will be able to refinance a loan on your home or arrange for you to keep your home." c. A foreclosure consultant contract shall be written in the same language as principally used by the foreclosure consultant to describe the consultant's services to be performed and the distressed property relief to be secured for the owner, shall be dated and signed by the owner, and shall contain in immediate proximity to the space reserved for the owner's signature a conspicuous statement in 14-point boldface type, if the contract is printed, or in capital letters, if the contract is typed, as follows: "You, the owner, may cancel this transaction at any time until after the foreclosure consultant has fully performed every service the foreclosure consultant contracted to perform and has secured the distressed property relief for the owner. See the attached notice of cancellation form for an explanation of this right." d. A foreclosure consultant contract shall contain on the first page, in a type size no smaller than that generally used in the body of the document, each of the following: (1) the name and address of the foreclosure consultant to which the notice of cancellation is to be mailed; and (2) the date the owner signed the contract. e. A foreclosure consultant contract shall be accompanied by a completed form, captioned "NOTICE OF CANCELLATION" which shall be attached to the contract and easily detachable, and shall contain, in at least 14-point boldface type, if the contract is printed, or in capital letters, if the contract is typed, the following statement written in the same language as used in the contract: "NOTICE OF CANCELLATION ........................................ (Enter date of transaction) You may cancel this transaction, without any penalty or obligation, at any time until after the foreclosure consultant has fully performed every service and has secured the relief for the owner. To cancel this transaction, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice to: ......................................(Name of foreclosure consultant) at ......................................(Address of foreclosure consultant's place of business) I hereby cancel this transaction on .....................................(Date) .........................................................................(Owner's signature)." f. The foreclosure consultant shall provide the owner with a copy of a foreclosure consultant contract and the attached notice of cancellation in duplicate immediately upon execution of the contract. g. The foreclosure consultant shall record the contract with the county clerk in the county in which the distressed property is located, within 10 business days of its execution. L.2011, c.146, s.4.

N.J. Stat. § 46:10B-57 Additional legal rights of owner.

5. a. In addition to any other legal right to rescind a foreclosure consultant contract, an owner has the right to cancel a foreclosure consultant contract at any time until after the foreclosure consultant has fully performed every service the foreclosure consultant contracted to perform and has secured the relief for the owner. b. Cancellation occurs when the owner delivers by any means, written notice of cancellation to the foreclosure consultant at the address specified in the foreclosure consultant contract. A notice of cancellation, if given by mail, is effective when deposited in the mail properly addressed with postage prepaid. A notice of cancellation sent by certified mail, return receipt requested, to the address specified in the foreclosure consultant contract, shall be conclusive proof of notice of cancellation. c. A notice of cancellation given by the owner need not take the particular form as provided with the foreclosure consultant contract and, however expressed, is effective if it indicates the intention of the owner not to be bound by the contract. L.2011, c.146, s.5.

N.J. Stat. § 46:10B-58 Violations relative to foreclosure consultants.

6. It is a violation of this act for a foreclosure consultant to: a. claim, demand, charge, collect, or receive any compensation until after the foreclosure consultant has fully performed every distressed property service the foreclosure consultant contracted to perform and has secured the distressed property relief for the owner; b. claim, demand, charge, collect, or receive any fee, interest, or any other compensation for any reason, in excess of two monthly mortgage payments of principal and interest, or the most recent quarterly property tax installment on the distressed property, whichever is less; c. take a wage assignment, a lien of any type on real or personal property, or other security to secure the payment of compensation. Any agreement to take such security is void and unenforceable; d. receive any consideration from any third party in connection with distressed property services rendered to an owner; e. acquire any interest, directly or indirectly, or by means of a subsidiary or affiliate in a distressed property from an owner with whom the foreclosure consultant has contracted; f. accept any power of attorney from an owner for any purpose, except to inspect documents as provided by law; or g. induce or attempt to induce an owner to enter a contract that does not comply in all respects with sections 4 and 5 of this act. L.2011, c.146, s.6.

N.J. Stat. § 46:10B-59 Waiver void, unenforceable.

7. a. Any waiver by an owner of the provisions of section 4, 5, or 6 of this act is void and unenforceable as contrary to public policy. b. Any attempt by a foreclosure consultant to induce an owner to waive the owner's rights is a violation of this act. L.2011, c.146, s.7.

N.J. Stat. § 46:10B-60 Written contract required for conveyance of distressed property.

8. a. A distressed property purchaser who enters into a distressed property conditional conveyance or a distressed property conveyance shall do so in the form of a written contract. A distressed property conditional conveyance contract and a distressed property conveyance contract shall be written in at least 14-point boldface type, in the same language principally used by the owner to negotiate the sale of the distressed property, shall be fully completed, signed, and dated by the owner and the distressed property purchaser, and shall be witnessed and acknowledged by a notary public, before the owner executes a deed or any other instrument of conveyance of the distressed property. b. A distressed property conditional conveyance contract and a distressed property conveyance contract shall contain the entire agreement of the parties, be fully assignable, and survive delivery of any deed or any other instrument of conveyance of the distressed property. c. A distressed property conditional conveyance contract and a distressed property conveyance contract shall include the following terms, except that a distressed property conveyance contract shall not be required to contain the terms set forth in paragraph (5): (1) the name, business address, and telephone number of the distressed property purchaser; (2) the address of the distressed property; (3) the total consideration to be given by the distressed property purchaser in connection with or incident to the transaction; (4) a complete description of the terms of payment or other consideration including, but not limited to, any distressed property services of any nature that the distressed property purchaser represents will be performed for the owner before or after the transaction; (5) a complete description of the terms of any related agreement designed to allow the owner to remain in the dwelling including, but not limited to, a lease agreement, repurchase agreement, contract for deed, or a lease agreement with an option to purchase; (6) a notice of cancellation as provided in this section; (7) the following notice in at least 14-point boldface type, if the contract is printed, or in capital letters, if the contract is typed, and completed with the name of the distressed property purchaser immediately above the statement required by this section: "NOTICE REQUIRED BY NEW JERSEY LAW Until your right to cancel this contract has ended, .........................(Name) or anyone working for .........................(Name) CANNOT ask you to sign or have you sign any deed or any other document. You are urged to have this contract reviewed by an attorney of your choice within 10 business days of signing it."; and (8) if title to the distressed property will be transferred in the transaction, the following notice in at least 14-point boldface type, if the contract is printed, or in capital letters, if the contract is typed, and completed with the name of the distressed property purchaser immediately above the statement required by this section: "NOTICE REQUIRED BY NEW JERSEY LAW As part of this transaction, you are giving up title to your home." L.2011, c.146, s.8.

N.J. Stat. § 46:10B-61 Additional right of rescission, cancellation of contract.

9. a. In addition to any other right of rescission provided by applicable State or federal laws, the owner has the right to cancel a distressed property conditional conveyance contract or a distressed property conveyance contract with a distressed property purchaser until midnight of the 10th business day following the day on which the owner signs the contract, or until the conclusion of a sheriff's sale pursuant to the provisions of the "Fair Foreclosure Act," P.L.1995, c.244 (C.2A:50-53 et seq.), whichever occurs first, during which the owner may have an attorney review the contract. b. Cancellation of the contract occurs when the owner, or an attorney representing the owner, delivers, by any means, written notice of cancellation to the address specified in the contract. Notice of cancellation, if given by mail, is effective when deposited in the mail properly addressed with postage prepaid. Notice by certified mail, return receipt requested, to the address specified in the contract, shall be conclusive proof of notice of cancellation. c. A notice of cancellation given by the owner, or an attorney representing the owner, need not take the particular form as provided with the contract, and however expressed, is effective if it indicates the intention of the owner not to be bound by the contract. d. Within 10 business days following receipt of a notice of cancellation delivered in accordance with this section, the distressed property purchaser shall return to the owner, without condition, any original contract and any other documents signed by the owner. e. The 10 business days during which the owner, or an attorney representing the owner, may cancel the contract shall not begin to run until all parties to the contract have executed the contract and the distressed property purchaser has complied with all the requirements of this section. L.2011, c.146, s.9.

N.J. Stat. § 46:10B-62 Option of cancellation statement in contract.

10. a. A distressed property conditional conveyance contract and a distressed property conveyance contract with a distressed property purchaser shall contain in immediate proximity to the space reserved for the owner's signature a conspicuous statement in a size equal to at least 14-point boldface type, if the contract is printed, or in capital letters, if the contract is typed, as follows: "You may cancel this contract for the conveyance of your house, without any penalty or obligation, at any time before ...........................................(Date and time of day). See the attached notice of cancellation form for an explanation of this right." The distressed property purchaser shall accurately enter the date and time of day on which the cancellation right ends. b. A contract with a distressed property purchaser shall be accompanied by a completed form in duplicate, captioned "NOTICE OF CANCELLATION" in a size equal to a 14-point boldface type, if the contract is printed, or in capital letters, if the contract is typed, followed by a space in which the distressed property purchaser shall enter the date on which the owner executes any contract. This form shall be attached to the contract, shall be easily detachable, and shall contain in at least 14-point type, if the contract is printed, or in capital letters, if the contract is typed, the following statement written in the same language as used in the contract: "NOTICE OF CANCELLATION ........................................... (Enter date contract signed) You may cancel this contract for the conveyance of your home, without any penalty or obligation, at any time before ............................ (enter date and time of day). To cancel this transaction, mail or deliver a signed and dated copy of this cancellation notice to ................................. (Name of purchaser) at ................................... (Street address of purchaser's place of business) NOT LATER THAN ................................................. (Enter date and time of day). I hereby cancel this transaction on ................................... (Date) ......................................................................... (Owner's signature)." c. The distressed property purchaser shall provide the owner with a copy of the contract and the attached notice of cancellation in duplicate at the time the contract is executed by all parties. d. The distressed property purchaser shall record the contract and the attached notice of cancellation with the county clerk in the county in which the distressed property is located within 10 business days of the signing of the contract by both parties. L.2011, c.146, s.10.

N.J. Stat. § 46:10B-63 Prohibited actions of distressed property purchaser.

11. a. A distressed property purchaser, in the course of a distressed property conditional conveyance, shall not: (1) enter into, or attempt to enter into, a distressed property conditional conveyance unless the distressed property purchaser verifies and can demonstrate that the owner has a reasonable ability to pay for the subsequent conveyance of a fee interest back to the owner under the terms of any option to purchase and a reasonable ability to make monthly or any other required payments due prior to the subsequent conveyance; (2) fail to make a payment to the owner at the time the title to the distressed property is conveyed from the owner to the distressed property purchaser, or, if the distressed property purchaser acquires a beneficial interest through a trust, at the time of the creation of the trust, so that the owner has received consideration in an amount of at least 82% of the property's fair market value, or, in the alternative, fail to make a payment to the owner, in situations in which the owner is unable to purchase the distressed property from the distressed property owner at the time of the expiration of the owner's option to purchase, so that the owner has received consideration in an amount of at least 82% of the property's fair market value; (3) enter into an option to purchase or lease as part of a distressed property conditional conveyance containing terms that are unfair or commercially unreasonable, or engage in any other unfair conduct; (4) represent, directly or indirectly, that the distressed property purchaser is acting as an advisor or a consultant, or in any other manner represent that the distressed property purchaser is acting on behalf of the homeowner; (5) misrepresent the distressed property purchaser's status as to licensure or certification; (6) do any of the following until after the time during which the owner may cancel the transaction: (a) accept from the owner an execution of a deed or any other instrument of conveyance of any interest in the distressed property; (b) induce the owner to execute a deed or any other instrument of conveyance of any interest in the distressed property; or (c) record with the county recorder of deeds any document signed by the owner, including but not limited to a deed or any other instrument of conveyance; (7) fail to convey title to the distressed property to the owner under an option to purchase provided for in the distressed property conveyance contract, in situations in which the terms of the conveyance contract have been fulfilled; (8) enter into a distressed property conditional conveyance if any party to the transaction is represented by way of a power of attorney; (9) fail to extinguish all liens encumbering the distressed property, immediately following the conveyance of the distressed property, or fail to assume all liability with respect to the lien in foreclosure and prior liens that will not be extinguished by the foreclosure, which assumption shall be accomplished without violations of the terms and conditions of the lien being assumed; (10) cause the property to be conveyed or encumbered without the knowledge or permission of the owner, or in any way frustrate the ability of the owner to complete the conveyance back to the owner; (11) fail to have all documents executed as part of a distressed property conditional conveyance also signed by a notary public licensed in the State who is unrelated in any way to the distressed property purchaser or any participant in the distressed property conveyance; (12) fail to complete a distressed property conditional conveyance in the office of a title insurance producer licensed pursuant to the "New Jersey Insurance Producer Licensing Act of 2001," P.L.2001, c.210 (C.17:22A-26 et seq.), or in the office of an attorney licensed to practice law in this State; (13) fail to provide to the owner, prior to the time of completion of a distressed property conditional conveyance, a disclosure statement in a form to be designed and prescribed by regulation by the Commissioner of Banking and Insurance, which statement shall require disclosure to the owner of all costs that the owner will incur in connection with the conveyance and any option for the owner to purchase the property, including a schedule of monthly and annual payments, closing costs, and any additional costs and fees related to the conveyance; (14) claim, demand, charge, collect, or receive any fee, interest, or any other compensation for any reason from an owner, for services or as consideration for offering or providing any option to purchase to the owner or for otherwise participating in the conveyance transaction, in excess of 3.5% of the purchase price; (15) in situations in which the distressed property conditional conveyance involves a transfer of an interest in fee from an owner to a distressed property purchaser, fail to record the deed to the purchaser in the county clerk's office in which the property is located, or fail to include a statement on the recorded deed that the deed was obtained through a transaction governed by the "Foreclosure Rescue Fraud Prevention Act"; (16) fail to notify in writing all existing mortgage lien holders of the distressed property purchaser's intent to accept conveyance of an interest in the property from the owner; (17) fail to fully comply with all terms and conditions contained in the mortgage lien documents, including but not limited to due-on-sale provisions; (18) fail to satisfy all qualification requirements for assuming the repayment of mortgage; and (19) enter into an option to purchase or lease as part of a distressed property conditional conveyance in which the agreement fails to provide for a length of time of at least three years within which the owner may exercise his right to purchase back the property. b. For purposes of paragraph (1) of subsection a. of this section, an evaluation of "reasonable ability to pay" shall include the owner's debt to income ratio, the owner's residual income, the fair market value of the distressed property, and the owner's credit history. There shall be a rebuttable presumption that the distressed property purchaser has not verified reasonable payment ability if the distressed property purchaser has not obtained documents of assets, liabilities, and income, other than a statement by the owner. c. For purposes of paragraph (2) of subsection a. of this section: (1) an appraisal at the time that the distressed property is conveyed by a person licensed or certified by an agency of this State or the federal government shall create a rebuttable presumption that the appraisal is an accurate determination of the fair market value of the property; and (2) "consideration" means any payment or thing of value provided to the owner, including reasonable costs paid to independent third parties necessary to complete the distressed property conveyance or payment of money to satisfy a debt or legal obligation of the owner. "Consideration" shall not include amounts imputed as a down payment or fee to the distressed property purchaser, or a person acting in participation with the distressed property purchaser. d. If an owner fails to make a required payment or otherwise defaults under a distressed property conditional conveyance contract which contains an owner's option to purchase or a promise to convey an interest in fee back to the owner, the distressed property purchaser shall only enforce the forfeiture of the owner's interest under the contract as follows: (1) for purposes of the "Fair Foreclosure Act," P.L.1995, c.244 (C.2A:50-53 et seq.), the distressed property conditional conveyance contract shall be deemed to be a residential mortgage, the distressed property purchaser shall be deemed to be a lender, and the owner shall be deemed to be a debtor; and (2) the distressed property purchaser may bring an action to enforce the forfeiture of the owner's interest in the property and for recovery of possession of the property by use of the procedures for foreclosure and judicial sale of residential real property available to lenders pursuant to the provisions of the "Fair Foreclosure Act." e. With respect to the amount of any fee or other consideration provided by an owner to a distressed property purchaser at the time of the execution of an option to purchase, as part of any distressed property conditional conveyance, and as consideration for that agreement: (1) the entire fee or other consideration shall be provided by the owner at the time of the execution of the option to purchase or lease agreement; (2) the distressed property purchaser may declare some or all of the fee or other consideration to be non-refundable, regardless of whether the owner exercises his right to purchase back the property from the distressed property purchaser pursuant to the option to purchase or lease agreement, or declare that some or all of the fee or other consideration shall be applied as credit toward the purchase of the property, if the owner does exercise his right to purchase back the property, so long as this declaration is agreed to by the owner and expressly stated in the agreement; and (3) the fee or other consideration provided to the distressed property purchaser shall not constitute an equitable ownership interest in the property. f. With respect to any money provided by the owner to the distressed property purchaser pursuant to any distressed property conditional conveyance, remitted as a monthly credit towards the purchase of the property in excess of any monthly rental obligation established pursuant to any agreement designed to allow the owner to remain in the property, including, but not limited to, a lease agreement between the parties: (1) the distressed property purchaser may declare some or all of the money to be non-refundable, if the owner does not exercise his right to purchase back the property from the distressed property purchaser pursuant to the option to purchase or lease agreement, so long as this declaration is agreed to by the owner and expressly stated in the agreement; (2) the money provided to the distressed property purchaser shall not constitute an equitable ownership interest in the property; and (3) the money shall continue to be the property of the owner and shall be held in trust by the distressed property purchaser for use as a credit towards the purchase of the property, subject to any agreement pursuant to paragraph (1) of this subsection. g. If the owner exercises his right to purchase back the property from the distressed property purchaser pursuant to the option to purchase agreement: (1) any amount still owed toward the purchase price or other consideration on the property, as set forth in the agreement, following the application of any fee, money, or other consideration agreed to be applied towards the purchase by the distressed property purchaser as credit towards the purchase, shall be the sole responsibility of the owner; and (2) a new deed for the property shall be executed by the distressed property purchaser and filed with the office of the county clerk in the county in which the property resides. L.2011, c.146, s.11.

N.J. Stat. § 46:10B-64 Requirements for distressed property purchaser.

12. A distressed property purchaser, in the course of a distressed property conveyance, shall not fail to: a. make a payment to the owner at the time the title to the distressed property is conveyed from the owner to the distressed property purchaser, so that the owner has received consideration, as defined by paragraph (2) of subsection c. of section 11 of this act, in an amount of at least 82% of the property's fair market value; b. have all documents executed as part of a distressed property conveyance also signed by a notary public licensed in the State who is unrelated in any way to the distressed property purchaser or any participant in the distressed property conveyance; c. complete a distressed property conveyance in the office of a title insurance producer licensed pursuant to the "New Jersey Insurance Producer Licensing Act of 2001," P.L.2001, c.210 (C.17:22A-26 et seq.), or in the office of an attorney licensed to practice law in the State; d. provide to the owner, prior to the time of completion of a distressed property conveyance, a disclosure statement in a form to be designed and prescribed by regulation by the Commissioner of Banking and Insurance, which statement shall require disclosure to the owner of all costs and fees that the owner will incur in connection with the conveyance; e. notify in writing all existing mortgage lien holders of the distressed property purchaser's intent to accept conveyance of an interest in the property from the owner; f. fully comply with all terms and conditions contained in the mortgage lien documents, including but not limited to due-on-sale provisions; and g. satisfy all qualification requirements for assuming the repayment of the mortgage. L.2011, c.146, s.12.

N.J. Stat. § 46:10B-65 Waiver void, unenforceable.

13. Any waiver of the provisions of section 8, 9, 10, 11, or 12 of this act is void and unenforceable as contrary to public policy. L.2011, c.146, s.13.

N.J. Stat. § 46:10B-66 Powers of commissioner relative to compliance.

14. a. The Commissioner of Banking and Insurance may investigate or examine any foreclosure consultant, or other person as the commissioner deems necessary to determine compliance with this act. For these purposes, the commissioner may examine the books, accounts, records and other documents or matters of any foreclosure consultant or other person. Each foreclosure consultant shall be subject to an examination by the commissioner, not more than once in any 12-month period, unless the commissioner has reason to believe that the foreclosure consultant is not complying with the provisions of this act, or is not transacting business in accordance with law, in which case the commissioner may conduct an examination at any time. The commissioner shall have the power to compel by subpoena the production of all relevant books, accounts, records and other documents and materials relative to an examination or investigation. b. The commissioner or the commissioner's designee shall have power to issue subpoenas to compel the attendance of witnesses and the production of documents, papers, books, accounts, records and other evidence before him in any matter over which he has jurisdiction pursuant to this act, and to administer oaths and affirmations to any person. c. If any person shall refuse to obey a subpoena, or to give testimony or to produce evidence as required thereby, the commissioner may apply ex parte to any court having jurisdiction over that person for an order compelling the appearance of the witness before the commissioner to give testimony or to produce evidence as required thereby, or both. d. A foreclosure consultant shall have its financial records audited annually by a certified public accountant, which audit shall be filed with the commissioner. The commissioner shall conduct at least one examination of the financial records of every foreclosure consultant licensed in the State every two years. L.2011, c.146, s.14.

N.J. Stat. § 46:10B-67 Violations, penalties; degree of crime.

15. a. Any person who violates any provision of this act shall, in addition to any other penalty provided by law, be liable to a penalty of not more than $10,000 for the first offense, and not more than $20,000 for the second and each subsequent offense, which penalty may be collected in a summary proceeding pursuant to the "Penalty Enforcement Law of 1999," P.L.1999, c.274 (C.2A:58-10 et seq.). b. A person who violates any provision of this act is guilty of a crime of the third degree. A person who violates any provision of this act in connection with a pattern of foreclosure rescue fraud or a conspiracy or endeavor to engage in a pattern of foreclosure rescue fraud is guilty of a crime of the second degree. c. Any distressed property conditional conveyance involving the transfer of an interest in fee or a beneficial interest created through a trust document, in a distressed property, and involving the acquirer of the property allowing the owner to occupy the property, which is made in violation of any provision of this act, is voidable and the transfer may be rescinded by the owner within two years of the date of the transfer, provided that the right, title or interest in the property of a bona fide purchaser or mortgagee for value shall not be affected thereby. Nothing herein shall limit the right of an owner to recover damages from a distressed property purchaser. d. An owner may bring an action in Superior Court against a foreclosure consultant or a distressed property purchaser for any violation of this act, for treble damages, attorney's fees, costs of suit and appropriate equitable relief. In an action under this subsection, the owner may: (1) cause a notice of lis pendens to be filed in the office of the county clerk in the county in which the property is located, pursuant to N.J.S.2A:15-6 et seq.; and (2) introduce or provide as evidence in the action, any contemporaneous oral agreements or representations made to the owner by any party to a foreclosure consultant contract, distressed property conditional conveyance contract, or distressed property conveyance contract signed by the owner. e. The remedies and rights provided for in this act are not exclusive, but cumulative, and all other remedies or rights provided by State or federal law, including, but not limited to, those brought under the doctrine of equitable mortgage or pursuant to the "Fair Foreclosure Act," P.L.1995, c.244 (C.2A:50-53 et seq.) are specifically preserved. Nothing in this act shall be construed to limit the application of the consumer fraud act, P.L.1960, c.39 (C.56:8-1 et seq.). f. If the Commissioner of Banking and Insurance determines that there has been any substantial violation of this act by a professional licensed under a licensing board in this State, the commissioner shall provide a written notice describing the violation to the licensing board having jurisdiction over the profession, for such action as the board deems appropriate. L.2011, c.146, s.15.

N.J. Stat. § 46:10B-68 Enforcement, regulations.

16. The Commissioner of Banking and Insurance shall enforce the provisions of this act, and may promulgate regulations pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) necessary to effectuate the purposes of the act. L.2011, c.146, s.16.

Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://www.njleg.state.nj.us/legislative-activity/statutesFetched: 10/17/2026