Understand The Foreclosure Process
in New Jersey
Before a home owner reaches foreclosure status they go through pre-foreclosure which is when a homeowner misses 3 to 6 months or more of mortgage payments. The home owner's lending institution will issue a warning, notifying the homeowner to pay or lose their home via foreclosure.
What is foreclosure?
Foreclosure is the legal process that lenders use to take back a property that was secured by a loan, generally, after the borrower stops making payments. Foreclosure isn't the end of the world. One can become empowered by learning about the foreclosure process so they can make an informed decision.
The Basic Stages of A Foreclosure
New Jersey is a judicial state. The process listed below is how the foreclosure manifests itself:
- Your mortgage lender must file suit in the court system.
- You’ll get a letter from the court demanding payment.
- Assuming the loan is valid, you’ll have 30 days to bring payment to court to avoid foreclosure (and sometimes that can be extended).
- If you don’t pay during the payment period, a judgment will be entered and the lender can request the sale of your property – usually through an auction.
- Once the property is sold, the sheriff serves an eviction notice and forces you to immediately vacate the property.
Foreclosure typically doesn’t go to court until 3-6 months of missed payments have elapsed. Generally, a lender will send out several notices to the home owner that they are in arrears, overdue or behind on the mortgage payment.
Anyone who has an interest in the property must be notified during either type of foreclosure.
For example, any contractors or banks with liens against a foreclosed property are entitled to collect from the proceedings of an auction.
What Happens After A Foreclosure Auction?
After a foreclosure is complete, the loan amount is paid off with the sale proceeds.
Sometimes, if the sale of the property at auction isn’t enough to pay off the loan, a deficiency judgment can be issued against the borrower.
A deficiency judgement is when the lender places a judgement against, the borrower for the remaining funds owed to the bank on the loan amount after the foreclosure sale.
Some states limit the amount owed in a deficiency judgment to the fair value of the property at the time of sale, while other states will allow the full loan amount to be assessed against the borrower.
Here’s a great resource that lists the New Jersey deficiency judgement laws, since every state is different.
It’s best to avoid a foreclosure auction. Instead, call up the bank, or work with a reputable real estate firm like Five Star Home Ventures to help negotiate a discounts off the amount owed avoid foreclosure.
Experienced investors can help you by negotiating directly with banks to lower the amount you owe in a sale – or even eliminate it, even if your home is worth less than you owe.
If you need to sell a property in New Jersey, we can help you.
We buy houses in New Jersey from home owners who need to sell fast.
Can Be Confusing When
Encountering A Hardship
Are you are experiencing any of the following:
The Question Is - What I The Right Choice?
Want To Learn How To Stop Foreclosure Now?
We’ve created a free online guided to help home owners discover their options .
If you are in foreclosure, you aren’t the first person and won’t be the last. Most people experience a hardship at one point in their lives. There is nothing to feel ashamed about when experiencing a foreclosure. It happens.
The best thing to do now, if this pertains to you, is educate yourself on your options. For some people selling your home is the best option.
Five Star Home Ventures will make a fair all-cash offer on your house today! Let us know about your situation. Sometimes we are able to help homeowners AVOID FORECLOSURE and other times there are other alternatives.
Need more information on the foreclosure process and How To Stop Foreclosure?
You can also call us anytime if you have questions, want a no hassle situation evaluation or want to just learn more about how we can help homeowners avoid foreclosure or sell unwanted properties for cash.