Press Statement
| For Immediate Release | Contact | Phone |
| September 15, 2008 | Phyllis Salowe-Kaye, Executive Director NJCA |
973-643-8800 |
Statement of Phyllis Salowe-Kaye,
Executive Director of New Jersey Citizen Action
Save New Jersey Homes Act of 2008 (A2780/S1853)
Governor Corzine today signed the "Save New Jersey Homes Act of 2008" (A2780/S1853) which provides for a 3 year freeze on low, introductory "teaser" mortgage rates. These loans are used by lenders to lure borrowers into mortgages that eventually escalate to the point where many homeowners are unable to afford the payments resulting in a foreclosure.
"This law will clearly provide struggling borrowers with more time to adjust their finances and work with lenders to modify the terms of what could end up being an unaffordable loan while suspending foreclosure for 3 years" said Phyllis Salowe-Kaye, Executive Director, NJCA.
"But it is really important for everyone to understand that this is only a first step. With thousands of NJ homeowners facing foreclosure, the Governor and this Legislature need to take much bolder measures to address the crisis."
Passing the NJ Homeowner Security Prevention Act (A2517/S1599), sponsored by Senator Ron Rice and Assemblywoman Bonnie Watson-Coleman, will provide funding for counseling and legal assistance to help those facing the loss of their homes. Additionally, the bill provides for the following:
- A six-month moratorium on certain defaulted loans to allow the borrower time to work towards a more favorable solution.
- Creation of a fund to provide foreclosure prevention counseling and "catch-up" loans to help people stay in their homes.
- The fund would be built on a $2,000 impact fee charged to lenders who foreclose on subprime loans, and is projected to raise between $27 million and $33 million for the year.
- Allows former homeowners who lose their homes due to foreclosure to remain in the property as tenants until the property is acquired by someone who plans to occupy it.
- Provides other protections against future lending abuses.
"It is only after a comprehensive program, that addresses a wide range of issues, is implemented that we can truly save homes in New Jersey" said Salowe-Kaye.
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