|
|
|
Media Release
| For Immediate Release | Contact | Phone |
| December 15, 2008 | Phyllis Salowe-Kaye, NJCA | 973-643-8800 ext 14 |
| Joseph Picard, HCDNNJ | 609-393-3752 ext 12 |
Joint Statement on the Passage of Foreclosure Prevention Legislation
TRENTON — The Housing & Community Development Network of NJ and New Jersey Citizen Action, two advocacy organizations that together represent over 100,000 New Jersey residents, today applauded the state Legislature for the expected passage of the NJ Mortgage Stabilization and Relief Act (S.1599/A.3506), which they called the kind of comprehensive response needed to address the state's growing subprime foreclosure crisis.
"The foreclosure issue has many aspects, and this legislation makes major strides in addressing many of them," said Diane Sterner, the Network's executive director. "We look forward to working with legislators in the coming year to address elements that were not included in this bill, such as securing the right to rent by former homeowners and establishing a foreclosure impact fee on high-cost, subprime loans to be paid by the lender when they opt to foreclose."
The groups urged Governor Corzine to sign the measure into law as quickly as possible, and make relief available to families threatened by foreclosure.
"From the middle of 2007 to the end of 2009, between 35,000 and 40,000 New Jersey homeowners are likely to face foreclosure as a result of high-cost, subprime loans, with 13,000 to 17,000 residents affected by this epidemic this year alone," said Phyllis Salowe-Kaye, executive director of NJ Citizen Action. "With passage of this bill, the NJ Legislature takes a major step forward in keeping homeowners from losing their homes."
Important elements in the bill include allowing the NJ Housing Mortgage and Finance Agency (HMFA) to expand its mortgage refinancing assistance to homeowners. The new bill also creates, at HMFA, a Housing Assistance and Recovery Program (HARP) Support Fund, to provide neighborhood stabilization efforts by keeping homeowners at risk of foreclosure in their homes.
In addition to supporting mediation and counseling services, the bill will:
- Make creditors that initiate foreclosure proceedings responsible for abating all code violations on the property if the borrower vacates the property at any time after the initial foreclosure filing;
- Require forbearance — a six-month hold on foreclosure proceedings at the borrower's request, to allow borrowers a chance to negotiate workout, refinancing or short sale options;
- Prohibit "phishing," or the selling lists of "trigger leads" — people who have recently applied for a mortgage — to other companies, leading to borrowers being inundated with letters and phone calls from less-than-legitimate lenders;
- Require reporting to the state Department of Banking and Insurance by those initiating foreclosure.
###