New Jersey Fair Foreclosure Act interpreted in case of "first impression"

Notice to tenant pursuant to the Fair Foreclosure Act must be given as set forth in the statute.

New Jersey tenants are protected from predatory landlords by the provisions of the New Jersey's Anti-Eviction statute.  So what happens to a tenant when a property is foreclosed?

A tenant cannot be evicted unless there is a violation of the lease, or a non-payment of rent.  A newly decided case looks at the provisions of the Anti-Eviction statute and the New Jersey Foreclosure Fairness Act.

UTS BECHMAN, LLC v. LIZA WOODARD (SUPERIOR COURT OF NEW JERSEY ESSEX COUNTY LAW DIVISION, SPECIAL CIVIL PART, DOCKET NO. LT-17399-19) begins in a divorce case where the wife was made the tenant of the former marital residence.  The mortgage that the former couple made on the property went into default and the plaintiff became owner of the property and attempted to evict the tenant.  She fought back.

In its ruling, the appellate court says:

This case, one of first impression, involves the rights of a tenant under the New Jersey Foreclosure Fairness Act, N.J.S.A. 2A:50-69 to -71. This is New Jersey’s version of foreclosure reform legislation that swept the country following the 2008 “Great Recession.” Defendant, pro se, essentially argues that the statute shields her from eviction in this summary dispossess non-payment action because the new property owner did not strictly comply with the notice requirements of the statute. This court agrees.

The decision analyzes the Anti-Eviction law and the Foreclosure Fairness Act.  In holding for the tenant, the court says:

The language of the statute is plain and clear. The New Jersey Foreclosure Fairness Act was intended as remedial legislation designed to fully inform residential tenants of their rights after a foreclosure. The language used evidences a clear legislative intent that the statute be strictly construed. The legislation is designed to protect tenants from what, in some cases, may be predatory landlords who seek to wrongfully evict a tenant. In the present matter, the notices provided by plaintiff do not comply with the strict requirements of the New Jersey Foreclosure Fairness Act. 

The notice introduced at trial merely notifies the tenant where to pay the rent. It did not include any of the language required by the statute. Further, the notice was not properly served, in that it was not sent by regular and certified mail to defendant.

The moral to the story: Investors buying tenant occupied residential property at foreclosure sale must adhere to the provisions of both statutes before attempting an eviction.

The decision can be found at New Jersey Courts.  If you cannot access the decision, please contact us for a full copy.

We are the New Jersey title insurance agent that does it all for you. For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us, Vested Land Services LLC. We can help!

For your real estate purchase or mortgage refinance, or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow@vested.com

@vestedland

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Fences make good neighbors, but what happens if you are not happy with your fence?

Homeowner was not happy with the location of his fence.

Sues fencing contractor and loses.

We've all heard the saying, "good fences make good neighbors."  As a title insurance agent, we come across our share of cases where the fence is over the property line onto the neighbor's property.  So, the safe thing is to build your fence slightly within your property line. We always recommend that a surveyor be hired to accurately locate the boundary line.

Here's a case where the fence installer placed the fence 1 foot from the boundary line.  Safe, right?  Well, the homeowner wasn't happy and he sued the contractor claiming the fence violated the zoning ordinance.

The Court sided with the fence installer because there was no evidence the fence violated the zoning ordinance.

You can read the decision here.

We are the New Jersey title insurance agent that does it all for you. For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us, Vested Land Services LLC. We can help!

For your real estate purchase or mortgage refinance or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow@vested.com

@vestedland

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Reverse mortgages and an increase in home value

Reverse mortgage and an increase in home value and equity

The homeowner gets to keep it

Those familiar with reverse mortgages understand that it is the value of the senior citizen's home that serves as the basis for the amount of the reverse mortgage.  The mortgage has a face amount larger than the amount borrowed.

So, the borrower's question then arises, if my home increases in value, do I get to keep it?

The discussion follows on NJMoneyHelp.com:

Q. When there is a reverse mortgage, what happens if the value of the home goes up? Does the owner get the difference between the mortgage amount and the higher home value, or does the mortgage company get it?
— Homeowner

A. Let’s go over how reverse mortgages work.

A reverse mortgage is a loan that is available to homeowners who are 62 and older. The loan is a payment-free loan and interest accrues over the life of the loan, said Marnie Hards, a certified financial planner with Aznar Financial Advisors in Morris Plains.

She said the loan must be repaid in full upon the borrower’s death, when the home is sold or when the homeowner moves out of the home.

There are several ways you can tap the equity in the home.

“You can take a lump sum, a monthly payment or set up a line of credit that you may draw from,” Hards said. “The amount that will be available to you in the form of a reverse mortgage is based on a combination of the age of the youngest borrower, the property value and the interest rate available.”

When you establish a reverse mortgage, there is a principal limit, which is the maximum amount that you can receive from the mortgage, Hards said. This amount is determined at closing.

“If the value of your home increases and you want to increase the loan amount of the reverse mortgage, you would need to refinance your existing mortgage,” Hards said. “Homeowners may choose to refinance their mortgage if the lending limit increases, the interest rate decreases or if the current value of the home has increased since it was first set up.”

The current reverse mortgage limit amount in 2020 for the HUD home equity conversion mortgage (HECM) is $765,000, she said.

At the homeowner’s eventual demise, the beneficiaries would receive the market value of the home less the balance on the reverse mortgage at that time, Hards said.

There you have it!

We are the New Jersey title insurance agent that does it all for you. For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us, Vested Land Services LLC. We can help!

For your real estate purchase or mortgage refinance or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow@vested.com

@vestedland

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Homebuyers to be affected by changes in FICO score?

Homebuyers and the FICO score, will the changes help or hurt?

NYTimes.com points out- FICO is tweaking its all-important formula. Scores will rise for about 40 million people and drop for another 40 million.

The New York Times reports:

Your credit score — that all-important passport within the financial world — may be about to change. And it won’t necessarily be because of anything you did or didn’t do.

The Fair Isaac Corporation, the company that creates the widely used three-digit FICO score, is tweaking its formula. Consumers in good financial standing should see their scores bounce a bit higher. But millions of people already in financial distress may experience a fall — meaning they’ll have more trouble getting loans or will pay more for them.

For homebuyers, this can be trouble as those who are down-rated may not qualify for the best mortgage rates.  In those cases, borrowers may have to obtain private mortgage insurance (PMI) to complete the loan transaction.

Read the full article here.

We are the New Jersey title insurance agent that does it all for you. For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us, Vested Land Services LLC. We can help!

For your real estate purchase or mortgage refinance or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow@vested.com

@vestedland

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