If I Lose My Home to Foreclosure in New Jersey, Can I Get It Back?

If your home is foreclosed in New Jersey, you can get it back by redeeming it.

By , Attorney (University of Denver Sturm College of Law)

If you stop making your mortgage payments, the lender may use a process called "foreclosure" to sell your home and use the proceeds to repay the amount you borrowed, plus fees and costs.

In some states, after you lose the property at a foreclosure sale, you can get it back by "redeeming" it during a post-sale "redemption period."

What Is the Redemption Period for Foreclosure in New Jersey?

Foreclosures in New Jersey are "judicial," which means the bank files a lawsuit in court to foreclose. After the foreclosure sale, the New Jersey Court Rules provide a 10-day period during which the homeowner may file a motion objecting to the sale. (New Jersey Court Rule 4:65-5). After the 10-day period, the court must confirm the sale to finalize it.

The New Jersey Supreme Court has determined that foreclosed homeowners get the right to redeem:

  • within the 10-day period after the sale and
  • up until the court issues an order confirming the sale if objections are filed under the rule. (See Hardyston Nat. Bank v. Tartamella, 56 N.J. 508 (1970)).

Redeeming After a Deficiency Judgment

New Jersey also gives homeowners the right to redeem if the bank gets a deficiency judgment after the foreclosure.

If the bank gets a deficiency judgment and you want to redeem, you must bring an action for redemption within six months after the judgment is entered. (N.J. Stat. Ann. § 2A:50-4).

But you lose this right to redeem if you file an answer to the deficiency judgment lawsuit to dispute the deficiency amount. (N.J. Stat. Ann. § 2A:50-5).

How Much You'll Have to Pay to Redeem Your Home

To redeem, you must pay the total amount of the judgment, plus interest, costs, and all reasonable expenses that the purchaser incurred for taxes, assessments, other prior liens, and necessary repairs after the sale. (N.J. Stat. Ann. § 2A:50-4).

You may deduct from this amount any income the purchaser received from the property, like rent.

Other Options to Get Your Home Back Before the Sale

Rather than counting on redeeming the home, you could catch up on past-due payments before the sale to reinstate the loan. Under New Jersey law, you may reinstate by curing the default at any time up until the entry of a final judgment, and judgment can be delayed to allow some extra time to reinstate.

Or you could pursue other alternatives to foreclosure if you want to keep your house. For example, you might be able to arrange a mortgage modification, forbearance agreement, or repayment plan.

What Is the Equitable Right of Redemption in New Jersey?

New Jersey, like all states, provides an equitable right of redemption before a foreclosure sale. To redeem before the sale, you must pay off the mortgage debt (all of it, not just enough to bring the loan current), including principal, interest, fees, and costs. The equitable right to redeem ends at the foreclosure sale. However, to exercise the equitable right of redemption, you should send the payoff amount to the servicer well before this deadline.

If possible, present the funds in-person to the proper contact designated in the payoff quote, or wire the money well before the foreclosure sale. If the courier service has a delay or a bank processing error occurs, and your money doesn't arrive in time, the foreclosure sale will happen.

Finding New Jersey's Redemption Period Laws

In this article, you'll find details on laws covering redemption period laws in New Jersey, with citations to statutes so you can learn more. Statutes change, so checking them is always a good idea. How courts and agencies interpret and apply the law can also change. And some rules can even vary within a state. These are just some reasons to consider consulting an attorney if you're facing a foreclosure.

If you want information about foreclosure avoidance options, consider talking to a HUD-approved housing counselor.

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