New Jersey Passes Law to Maintain Properties Slated for Foreclosure

New Jersey Passes Law to Maintain Properties Slated for Foreclosure

Legislation sponsored by five members of the New Jersey State Assembly to empower municipalities to issue citations and impose fines on creditors who fail to maintain properties slated for foreclosure was signed into law August 15, 2014.

According to Assembly Speaker Vincent Prieto, who sponsored the legislation with Assemblymen Daniel Benson, Benjie Wimberly, Paul Moriarty and Carmelo Garcia, "Vacant properties are neighborhood eyesores that attract pests and criminal activity and drag down property values. Municipalities will now be able to take action against creditors who create nuisance situations for neighborhoods and municipalities by failing to maintain vacant properties that are set for foreclosure."

The new law (A-1257) states that in-state creditors found to be in violation of any ordinance, rule or  regulation adopted pursuant to the law would be subject to a minimum fine of $1,500 for each day of the violation. Out-of-state creditors would be subject to a $2,500 fine at minimum. At least 20 percent of any money collected would have to be used for code enforcement purposes. The law also requires out-of-state creditors to designate an in-state person or entity responsible for maintaining a property set for foreclosure.

It's interesting to note that three New Jersey cities, Newark, Elizabeth and Paterson, are among the top 10 cities in the U.S. hardest hit by the housing crisis, according to a recent Haas Institute study.