Since the housing bubble burst in late 2007, foreclosures have spiked across the country. New Jersey was especially hard hit and is one of the few states in the union that continues to see an increase in foreclosure actions even now, almost ten years later.
Among the causes of New Jersey’s continued foreclosure crisis is the complexity of the State’s foreclosure process. New Jersey is a “judicial foreclosure” state – meaning all foreclosure actions must be prosecuted by attorneys before judges in the court system. This structure is intended to impose a level of due diligence on lenders and assure an accurate disposition on the merits of a lender’s claim. The result however, is a bloated legal field that incentivizes cutting corners and rushed, even if not prompt, resolutions.
This is why a proper foreclosure defense is so important. The homeowner is the only person who understands their situation and truly cares about their home. Therefore they must be the one to stand up for their rights.
The problem for many individuals is that the system is confusing, complicated, and overwhelming. The average homeowner is not a legal expert, nor do they truly have the resources to understand a growing and nuanced area of the law. The internet is rife with foreclosure defense theories – some of which worked in 2007, some of which work now, some that work in other states, and some that never had a shot. The key to asserting a proper defense is understanding your rights, your lender’s obligations, how the court system works, and the rules, statutes, and case law that control everything.
The following pamphlet attempts to summarize that information based on our representation of hundreds of foreclosure clients in New Jersey over the course of the last eight years. The pamphlet outlines the anticipated foreclosure process when you retain the attorneys at Denbeaux & Denbeaux for your foreclosure defense. This outline does not hold true in every case, nor are the suggested timelines guaranteed. Rather, we offer this information to hopefully provide some clarity as your case progresses.
When you retain Denbeaux & Denbeaux, you are retaining a team of individuals as advocates for your cause. In your foreclosure matter, that team is led by Joshua Denbeaux . Joshua will be primarily responsible for your case and will at all times be kept abreast of your litigation. Day to day, your case will be managed by one or more associate attorneys. Those attorneys will work together, with the assistance of our talented support staff, to advocate on your behalf.
- Communication – it is imperative that you communicate with your lawyer. Often times nothing will happen with your case for weeks on end. However, if you ever want an update on where your case stands, you should not hesitate to reach out to the firm. Equally important is to be responsive when the firm reaches out to you. There may be instances during the litigation where we need a prompt response from you in order to advocate on your behalf. Non-communication could cause irreparable harm to your case.
- Document management – You should provide every letter, notice, communication you receive from your lender or servicer to your lawyer. Often times it will be meaningless, but you should let your lawyer make that call.
- Records – Keep good notes about everything that happens in regard to your loan; who you spoke to, when, and about what. Again, it may ultimately be irrelevant, but it may also be the key to a valid defense to the foreclosure – let your lawyer decide.
- Time Management – Don’t procrastinate. Sticking your head in the sand is the easiest way to lose your rights.
- Finance Management – While the foreclosure action is progressing, you will not be actively paying your mortgage. You should use this opportunity to save the money you would otherwise be paying to your lender and begin to repair your finances.
New Jersey Foreclosure Process Summary
Notice of Intent to Foreclose (“NOI”):
Permitted any time after default (generally sent 3 months or more after default)
Will state the lender’s intent to foreclose, will identify the lender, and will state the current amount owed.
The Foreclosure Complaint:
Filed at least 30 days after receipt of the NOI
The Complaint is the formal initiation of a foreclosure action. It must be served on each Defendant (including the Homeowner) within six months of filing.
Must be filed within 35 days of the Defendant’s receipt of the complaint
The Answer is either “Contesting” – it challenges the Plaintiff’s right to foreclose – or “Non-Contesting”.
Case Management Conference (“CMC”):
Scheduled approximately 1 – 2 months after filing the answer
Court conference where the Judge will set deadlines and dates for the case.
Generally, must be completed within 2-4 months of the CMC
The exchange of information relevant to the case between the parties.
Motion for Summary Judgment:
Must be heard at least 30 days before trial
A motion asking the court to determine that, as a matter of law, Plaintiff has the right to foreclose and the trial is unnecessary.
Set by the court, usually within 5 – 10 months of the CMC
If the matter is not disposed of by way of a dispositive (i.e. Summary Judgment) motion, the court will conduct a trial.
If the homeowner is successful at trial, the Complaint is dismissed and the bank must start over.
If the Court grants the Plaintiff’s MSJ or the Plaintiff is successful at trial, then the homeowner’s answer is stricken, and the process proceeds as follows:
Fair Foreclosure Act Notice:
May be sent any time after answer is stricken, usually within a month of the Order striking the Answer.
This notice informs you that the bank is prepared to move for Final Judgment and that you must let them know within 10 days whether or not within 45 days you will be able to redeem (pay back what you owe in its entirety).
Final Judgment Application:
Served on homeowner at least 14 days after your receipt of the FFA Notice
This is Plaintiff’s application to set the amount due by you to the bank. You have 10 days to object to this motion, if it contains an error.
Final Judgment Order:
Entered no less than 10 days after receipt of the FJ Application, often a month or longer depending on the Court’s caseload
This Order sets the amount due to the Plaintiff and gives the County Sherriff permission to conduct a Sherriff’s Sale.
Generally scheduled 1 – 2 months after entry of final judgment
The sale of the house to the bank or third party – this is NOT THE EVICTION DATE. You will be provided at least 10 days’ notice and may adjourn the sale a total of 4 weeks.
Held a month or more after the sheriff sale
The eviction date is the date by which you must be out of the house.