In certain states, a foreclosure can take a very long time. The time frame to complete a foreclosure in New Jersey was over three years on average in 2018, which was the third-longest timeline in the country. However, New Jersey has a law that streamlines the process for abandoned properties, making the foreclosure completion time for these types of properties much shorter.
Read on to learn more about how a foreclosure can be expedited for abandoned homes in New Jersey and why this could be beneficial—or detrimental—to you. (For more on foreclosure procedures in New Jersey, see New Jersey Foreclosure Procedures.)
Again, New Jersey foreclosures can take an exceptionally long time—about 1,161 days as of the second quarter of 2018—to complete. But a New Jersey law allows a lender to speed up a foreclosure if it can prove the property is vacant and abandoned, reducing the time for foreclosure to around 90 days. (N.J. Stat. Ann. § 2A:50-73.)
To get a reduced timeline, the law requires that the lender present clear and convincing evidence that the real estate is vacant and abandoned.
Specifically, the lender must show that the property is not occupied by the borrower—or other lawful tenant—and that two or more of the following conditions exist.
In New Jersey, foreclosures are judicial, which means the lender must file a lawsuit in state court to foreclose. (Learn more about the difference between judicial and nonjudicial foreclosure, and the procedures for each, see Will Your Foreclosure Take Place In or Out of Court?)
To fast-track a foreclosure on a property that is vacant and abandoned, the lender can:
Generally, if the court makes a finding in the foreclosure judgment that the property is vacant and abandoned, the sheriff will sell the property within 90 days of receiving a writ of execution issued by the court. New Jersey law also allows a lender to apply for a Special Master or judicial agent to sell the property within 90 days if it becomes apparent that the sheriff can't conduct the sale within this time frame.
When properties are abandoned, a lengthy foreclosure process ultimately harms the neighborhood. Vacant homes quickly start to show obvious signs of neglect. The lawn doesn’t get cut, litter begins to pile up, and the home often falls into disrepair. Abandoned homes are also susceptible to vandalism, squatters, and crime. This drags down the value of the property itself, as well as of the entire neighborhood.
Speeding up the foreclosure process for abandoned properties:
This law is designed to help stabilize the residential real estate market by reducing the time it takes to complete a foreclosure, thereby returning the property to an occupied status more quickly.
Homeowners won't become the victim of a zombie foreclosure if the lender completes the process promptly. But fast-track foreclosures are only beneficial in cases where the home is actually empty. Unfortunately, though, sometimes lenders pursue fast-track foreclosures without having clear evidence of abandonment.
If you still live in your home, a fast-track foreclosure can be a big problem because it means you’ll lose your home much faster than normal. This deprives you of valuable time to work out an alternative to foreclosure, like a modification, or simply to live in the home without making payments while you save up for new accommodations.
In most cases, you won’t get a lot of time to fight a fast-track foreclosure. If you find out the lender is improperly trying to fast-track a foreclosure in your case, talk to a foreclosure attorney right away to learn about your options.