If you are severely delinquent on your mortgage loan payments and you believe your lender will soon be taking action, it is important to understand how foreclosure works in New Jersey. Foreclosure is the legal process where the lender obtains a court order allowing it to sell your house after you default on your mortgage loan. During the foreclosure process, you will have several options to save your home. Thus, even if the foreclosure action has already begun it doesn’t mean you should give up hope. Contact us to learn the various options available to you.
The two main documents that are used to create a valid mortgage loan are a promissory note and mortgage. Your mortgage is filed with the County Clerk. The promissory note documents the amount of the loan and the money that you owe your lender. It sets forth the terms of repaying the loan, including the applicable interest rate, when your monthly payments are due, and the deadline to pay the loan in full.
Typically a mortgage lender will not file a foreclosure action until you have missed several payments, but you are in default as soon as you miss the very first payment. Your mortgage lender will likely file a document called a lis pendens, which serves as a public notice that the real property is in foreclosure. Next, the mortgage lender will serve you with a Summons and Complaint. If you wish to fight the foreclosure you have 35 days to file an Answer.The time it takes to complete a foreclosure varies significantly from case to case. However, in New Jersey it typically takes six months to a year for an uncontested foreclosure. It may take even longer if the homeowner fights the foreclosure action or files a personal bankruptcy case. If the lender obtains a judgment against you, a public sheriff’s sale will be scheduled to sell your home.
It is important to understand that a New Jersey homeowner has the statutory right of redemption. In other words, the homeowner whose property was foreclosed has a legal right to reclaim the property. To redeem foreclosed property, you must pay the unpaid balance of the mortgage loan plus the lender’s expenses in full. The time period for exercising your right of redemption is only within the 10 days following the foreclosure sale.
There are a number of different options available to fight back against foreclosure and it is critical to choose the right one for your circumstances. During your free consultation, attorneys Bruce Levitt and Shelley Slafkes will carefully explain all of your options so you can make an informed decision about how to best proceed. Contact us today at 973-323-2953 to schedule a free initial consultation with a compassionate and knowledgeable lawyer.