The foreclosure locomotive in New Jersey appears set to pick up steam once again. The process was slowed considerably over the last two years because of an investigation by the state attorney general’s office into allegations of fraud in the home repossession legal process.
Mortgage lenders were accused of something called robo-signing, which is basically the execution of documents that had not been properly verified. As a result, the entire process came to a halt, and many homeowners were able to stop foreclosure, at least for the time being. Now, however, banks are set to begin anew, and it is estimated that a backlog of up to 100,000 cases will start to work their way through the system.
New Jersey is said to rank second in the nation, behind only Florida, for the greatest number of homes currently in foreclosure. It is estimated that some 6.4 percent of mortgaged homes in our state are in some stage of the process of foreclosure. That figure is almost double the national average of 3.4 percent, tabulated as of December 2011.
With a glut of foreclosures expected to hit the courts going forward, a principal question on the minds of many facing legal action will be what steps they can take to stop foreclosure. There are a variety of alternatives available to homeowners as they fight to stave off repossession. While the current foreclosure process takes an average of more than 2.6 years to complete in New Jersey, the fact remains that some individuals and families may find relief by filing for bankruptcy protection. In doing so, debt relief can often be obtained in a manner that also provides for a fresh financial beginning.
Source: Bloomberg, “NJ has backlog of up to 100k foreclosures,” Stacie Servetah, Feb. 8, 2012