What
to do if you are facing foreclosure in New Jersey.
We are bankruptcy attorneys. We help people
obtain debt relief under the Bankruptcy Code.
First, don't panic, but
act now. Take control by starting to act and plan.
The thought of losing your home is scary for anyone.
However, your best chance of getting the best result for you comes
if you start planning and preparing right away to increase the chances
of the best possible outcome among the alternatives available to
you.
Watch out for scams. To learn
more, please see our article
on Foreclosure Scams and Ripoffs
1. Collect and start keeping records.
Start by collecting together and keeping all your records about
your home and your mortgage loan. This includes all your loan papers
and legal papers, any appraisals, any notices from your mortgage
lenders which you may have gotten and anything you get in the future.
Start taking notes of all your dealings with the lender, and start
keeping proof of all payments youl make.
2. Assess your budget and your priorities,
to see how well you can afford to pay the mortgage or pay back any
past due payments. ( Incredibly, many people, under pressure from
bill collectors, will pay credit card bills, leaving them no money
to pay the mortgage. If you want to keep your home, the mortgage
payment is more important. You have choices, and making the right
choices early will increase your chances that things end up the
way you want.
A personal and household Budget is your key. Spend
the time to honestly and carefully look at what income you have
coming in, and what are your expenses. A carefully prepared budget
tells you, and anyone from whom you seek advice, what you can afford
to do, and is critical to deciding what options are in your best
interest. You can make your own, or download our questionnaire {click
here} and use the budget form in it, or use our Excel spreadsheet.
{click
here for spreadsheet}
3. Find out what your home is worth. Most
realtors will give you a complimentary "Comparative Market
Analysis". Tell them that you want as accurate an idea of your
home's value now, in its current condition. This is another important
part of the picture.
4. Don't just spend the unpaid mortgage
payment. If your lender is no longer accepting payments,
consider putting the amount of each monthly payment aside in a savings
account. Just because the lender will not accept your payment does
not mean you should spend it, unless there is another pressing need
(like paying for food, medical care, or other critical needs. If
you do decide to save your home by bankruptcy or another means,
having some of the back payments will be helpful.
5. Most importantly, seek experienced advice
right away to find out your best options as soon as possible. Keep
in mind that doing nothing will make things worse. An experienced
professional adviser should review with you all your options and
be able to tell you the pluses and minuses of each. .
Keep an open mind and consider all your
choices. Sell? Refinance? Do a deal with the lender to
catch up? Bankruptcy? Not all of them may make sense for you, or
be possible. Again, it depends on what you can afford to do, and
what will work for you in the long term.
Understand the foreclosure process.
Foreclosure is a process, through legal proceedings,
for a lender to get paid back out of the value in your home. This
is, however, a multi-step process that takes many months. The loss
of your home happens only at the end. The sooner you start acting,
planning and start getting professional advice, the better your
chances of getting the best result for you. Do not delay
as generally the longer you wait, the fewer or more expensive your
options become.
The first step in New Jersey foreclosures of your
personal residence is the "30 day Cure letter".
This is a letter that tells you you are behind in your payments,
and gives you 30 days to bring the loan current. If you bring the
loan current, the process stops. If you cannot do this, then the
lender will start the foreclosure lawsuit, and will usually refuse
to accept further payments. Before this happens, get advice.
Even if you can "work out" an arrangement with the lender,
you should get advice and make sure any arrangement is confirmed
in writing.
Assuming you have not brought the loan current
after the deadline in the Cure Letter, the lender will then file
a Foreclosure Complaint. After this, the filed Complaint is served
on you, by mail or by other means. Do not ignore legal notices
you may receive in the mail.
However, before then you will probably start getting
a lot of mail from lawyers, real estate brokers, or mortgage lenders
promising to help you. These people may or may not have your best
interests in mind and may be trying to sell you something. Get
independent qualified legal advice, from someone you trust.
. If you do not file an Answer, then after about
35 days from the date you were served with the papers, the lender's
attorney will be able to get judgment by default.
This process will probably require that you get another notice by
certified mail that the lender is applying for judgment. The lender's
attorney then has to file papers with the Superior Court Clerk to
get a judgment. After these are processed, the clerk issues the
Foreclosure Judgment. Entry of this judgment takes place without
any further notice to you, and might take a long as two months after
you were served with the Complaint. The Foreclosure Judgment is
the legal paper that gives the lender the legal right to sell your
home.
The next notice to you will be that a Sheriff's
Sale has been scheduled for your home. The lender's attorney sends
the Foreclosure Judgement to the Sheriff in your county so he/she
can schedule a Sheriff's sale. Then there will be a notice in a
local paper of the first scheduled date of your sheriff's sale.
Depending on the backlog of sheriff sales in your county, it might
be weeks, or it might be months until the first sale date. IF
YOU HAVE NOT ALREADY DONE SO, YOU MUST SEEK LEGAL ADVICE, AS SOON
AS YOU RECEIVE NOTICE OF A SHERIFF'S SALE.
You are allowed to request postponement of the
Sheriff's sale twice. Each postponement is for two weeks at most.
These requests should be made in writing, with a copy to the lender's
attorney. You want to make sure to confirm the postponement date
with the Sheriff.
Then there is the Sheriff's Sale, usually at the
Courthouse or at the Sheriff's office. This is an auction, in which
the lender may buy your property back, or there may be bidding with
the highest bidder becoming the new owner of your home. Once
a Sheriff's Sale takes place, you lose important rights. The
Sheriff can deliver a deed to the purchaser but only after waiting
ten days after the sale date. You still have important rights,
if you act before that ten days is up. Get advice from an experienced
attorney, right away.
After the deed is issued, at least ten
days after the Sheriff's Sale, the Sheriff can come to evict you.
As you can see, you have time to act, but you should
not delay. All the above applies for mortgage foreclosures of a
residence in New Jersey. This summary is to give you a general idea
about how one type of foreclosure usually works. It may not apply
to you and you must get legal advice about your specific situation.
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How we can help you.
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Feel free to call us at 856-596-2828. The initial telephone consultation
is always free. Usually, we will want to see you in the office.
To make the best use of that meeting, we urge you to download and
fill out our client questionnaire, (click
here). Even though the questionnaire is for bankruptcy, that
does not mean a bankuptcy is right for you. However the information
in it is needed for us to help you choose what works best for you,
no matter what you do.
Steven R. Neuner
has the experience to help you plan and take control of the situation.
He has filed or presided over hundreds of bankruptcy cases and proceedings
over the past 24 years, and has helpe people in trouble save their
homes or save the value in them. For
more about him and his background click here
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