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Robo-signing Causes 100k Backlog of Foreclosures In NJ

February 8, 2012 By Leave a Comment

NJ Has Backlog of Up to 100K Foreclosures

Stacie Servetah, Bloomberg

New Jersey must work through a backlog of 50,000 to 100,000 unprocessed foreclosures because of delays caused by an investigation into how lenders handled the filings, said Richard Constable, acting commissioner of the state Community Affairs Department.

Foreclosures slowed to about 10,000 last year from 50,000 in 2010 and 150,000 two years ago after claims of “robo- signing” — unverified documents sped through the system — spurred an investigation by state attorneys general at the end of 2010, Constable said today at a meeting of mayors in the Statehouse in Trenton.

As many as 100,000 properties will soon come to market in New Jersey as banks resume processing foreclosure sales, Constable said. The state will work with towns to make sure that the foreclosures don’t blight neighborhoods, he said.

New Jersey has the second-highest inventory of homes in foreclosure after Florida, with 6.4 percent of all dwellings with a mortgage in the process, according to data released today by CoreLogic Inc., a Santa Ana, California-based data real estate information company. Nationally, 1.4 million homes, or 3.4 percent of those with a mortgage, were in foreclosure as of December.

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NJ Lawmaker Has Unique Foreclosure Plan

January 9, 2012 By Leave a Comment

Rescuing N.J. foreclosures: Lawmaker has proposal with potential

Star-Ledger Editorial

New Jersey Foreclosure PlanForeclosures proliferated like so many mushrooms in the wake of the housing and mortgage collapse. About 150,000 houses are in some stage of the foreclosure process in New Jersey. Vacant and boarded up, these houses are a blight on their neighborhoods, an invitation to vandalism and crime, and a drag on property values. Families evicted from those houses still need affordable places to live.

Meanwhile, towns across the state are sitting on nearly $300 million in housing trust fund dollars, accumulated from private developer fees. Many towns choose to do nothing because of uncertainty over affordable housing regulations, in flux since 2004. Others have been hostile to building anything.

Sen. Raymond Lesniak (D-Union) has an idea that ties those elements together and makes a lot of sense. He will introduce a bill this week to create a Foreclosure Relief Corp. within the state’s housing and mortgage finance agency. The new entity would use those socked-away trust fund dollars to buy foreclosed houses, which would then be converted to low- and moderate-income housing. Towns would get credit toward affordable housing obligations. Lenders who participate would get credit under the Community Reinvestment Act, which promotes investment in cash-starved communities. Lesniak predicts his plan could create as many as 30,000 new affordable homes in New Jersey.

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Future of foreclosures in N.J. hinges on state Supreme Court decision

December 4, 2011 By Leave a Comment

Sarah Portlock, Star-Ledger

florida foreclosures,mortgage fraud,mortgage audit,florida mortgage timelineIn the nearly five months since the state Supreme Court effectively allowed six of the country’s biggest banks to begin filing foreclosures again, attorneys and court officials have been expecting a flood of new filings to hit the courts.

Except it hasn’t happened. Foreclosure filings are down 83 percent as of October this year, compared with the same time period last year, according to court figures, and there are at least 100,000 cases either pending in the system or waiting to be submitted.

Attorneys involved in the work in New Jersey point to at least one reason for the significant delay: a court case that has reached the state Supreme Court, with oral arguments on Wednesday.

The case, US Bank National Association v. Guillaume, is important because the court is asked to determine who must be named as a point of contact on the document that initiates the foreclosure process, known as the Notice of Intent to Foreclose. The state Fair Foreclosure Act requires identifying the lender and its contact information. But because the original lender has often bundled and sold the loans to investors, the current lender lists the servicer, a third party that collects monthly payments and dispurses it to the mortgage holder. In this situation, the lender’s attorney argued it was unnecessary to name his client on the notice because the servicer had been assigned the mortgage rights.

Attorneys for the homeowners, Maryse and Emilio Guillaume, said listing the servicer is not sufficient, should the homeowner want to work out a solution and stay in the house, and any foreclosure judgment without the lender having been named should be voided.

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Legal issues slow foreclosures In NJ

November 8, 2011 By Leave a Comment

Kathleen Lynn, Bergen Record

In a small Bergen County courtroom one recent Friday, a sheriff’s officer auctioned off two foreclosed properties in a matter of minutes, as a handful of investors kept their eyes open for bargains.

It was a far cry from the typical sheriff’s auction of mid-2010, when 15 or more properties were auctioned weekly and up to 100 investors crowded the courthouse’s large jury room.

Sheriff’s auctions are among the most visible symbols of the housing crisis, which left many homeowners saddled with mortgages they couldn’t afford. But foreclosure auctions have slowed dramatically since questions arose more than a year ago about “robo-signing” — that is, sloppy paperwork by mortgage lenders and servicers.

Though lenders were given the go-ahead in August to start foreclosing again in New Jersey after showing a judge they were following the rules, they have been slow to resume activity.

The reason: an August appellate court decision, Bank of New York v. Laks, according to Kevin Wolfe, head of the state’s Office of Foreclosure. In that case, the court dismissed a foreclosure, finding the lender violated the state Fair Foreclosure Act because it didn’t properly identify itself in a notice sent to the troubled homeowners.

Under new state court rules, lawyers working for foreclosing plaintiffs have to personally certify that they have checked the facts behind a foreclosure filing with an employee of the lender or the lender’s servicer. Many have indicated to Wolfe that they are reluctant to sign such a certification, because they’re concerned that the lender’s paperwork may not meet the requirements set out in the Laks decision.

E. Robert Levy, executive director of the Mortgage Bankers Association of New Jersey, said he believed there was no “real question about the validity of the loans being put through the foreclosure process.”

“The money is still owed; it’s just a matter of making sure you meet the procedural requirements, and we agree the requirements should be met,” Levy said.

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