If you fail to stay up to date on your mortgage payments, your lender or bank can attempt take possession of your property through the foreclosure process. Facing foreclosure might seem insurmountable, but with reliable legal counsel you still have several options available to you. It is important to educate yourself on how foreclosure works and what you can do to avoid it.
How Does the Foreclosure Process Begin in New Jersey?
Once a homeowner or borrower has failed to make their mortgage payments, they are considered in default of their loan, and their lender or bank has the option to begin the foreclosure process. If the borrower resides in the home, the lender is required to send a Notice of Intention to Foreclose, (NOI). This notice will be sent by regular and certified mail and it will notify the homeowner that they have 30 days to pay all the arrears, otherwise the lender has the right to start a foreclosure. If the arrears are paid, the loan will be reinstated and foreclosure will be avoided. If the arrears are not paid, the lender can file Complaint in Foreclosure, and serve the borrower with the complaint and a court summons. The borrower will then have 35 days to answer the complaint.
What Are My Options?
By filing a “Contesting” Answer to the Complaint, a borrower raises defenses and forces the lender to prove that they have the right to foreclose. An experienced foreclosure defense attorney can help you identify proper defenses.
The New Jersey Foreclosure Complaint will also contain an application for the New Jersey Courts FREE Mediation Program.
If the Borrower resides in the property, this program gives the Borrower assistance to apply for a modification of the mortgage and end the foreclosure. Modification programs vary, depending on the owner and servicer of the loan. Modifications can:
- Extend the duration of your loan: If for example the mortgage is set for a twenty year duration, extending that to thirty years will make each payment smaller and more manageable.
- Lower the principal on your loan: The lender may be willing to reduce the amount owed as part of a modification.
- Reduce the loan’s original interest rate: This can greatly lower the monthly payments and the amount of interest you will pay over the duration of the loan.
- Forgive any late charges: The lender may be willing to wipe your late charges clear in order to get you back on track with your payments.
If you are facing foreclosure or you have missed payments and want to know if you can get a modification, it is important to seek legal counsel right away. Contact Ira Metrick today to discuss your foreclosure defense options.
