Foreclosure process in New Jersey

Is New Jersey a judicial or non-judicial state?

Judicial. The lender files a complaint with the Office of Foreclosure, which is part of the Superior Court Clerk’s Office. A homeowner who contests the case goes before a Superior Court judge in the county where the property sits; if nobody contests, the case stays with the Office of Foreclosure and moves forward without a judge. The Judiciary’s page names the Fair Foreclosure Act as one ground a homeowner can raise in an answer.

What are the steps and deadlines?

Each side can request two adjournments (stays) of the sale, and a fifth is possible if both ask. Fees quoted by the Judiciary include $405 for filing a complaint and $175 for an answer; fee waivers can be requested from the General Equity judge.

Before any of this, federal rules apply. Under Regulation X, a servicer may make the first foreclosure notice or filing only if the loan is more than 120 days delinquent, among other conditions. If a complete loss-mitigation application arrives more than 37 days before a sale, the servicer generally may not move for judgment or order of sale, or conduct a sale, until the application is resolved (12 CFR 1024.41(f) and (g)). CFPB says servicers generally must try to reach you within 36 days of delinquency and send a written notice of options within 45 days.

Can I keep the home or sell it?

Yes, at several points. The notice of intent tells you that you may sell or transfer the property. A workout with the lender does not end the case by itself: the lender’s attorney must ask the court to dismiss it. The Judiciary says occupancy generally continues until after the sheriff’s sale. If the sale price covers the debt, extra money goes to the debtor, according to the Judiciary. See our home-buying steps and capital gains guide if you are considering a sale instead.

What about a deficiency?

If sale proceeds are less than the amount owed, the Judiciary says the lender can sue the debtor for the remaining balance. The sources we read do not describe limits on that claim, so ask an attorney how it applies to your loan.

Example timeline

This example only adds up the deadlines above; real cases take longer when stays, mediation or contested motions occur. A homeowner receives a notice of intent on March 1. The 30 days end March 31. The lender files, and the homeowner has 35 days from receipt of the summons to answer. If the case is uncontested, the lender sends the final cure letter, with 10 days to respond and 45 days to cure. If no cure happens and a writ is issued, the sheriff has up to 150 days to sell.

Free mediation and counseling

• Foreclosure mediation is free, run by the Judiciary. A neutral person helps both sides but does not decide the case, and the lender can keep pursuing the foreclosure meanwhile. The NJ Housing and Mortgage Finance Agency says mediation must be requested within 60 days of service unless a court orders otherwise, and the home must be your residence.
• Pre-foreclosure counseling is available through the agency’s Foreclosure Mediation Assistance Program, even before any court papers. It requires an owner-occupied one- to four-unit home with a mortgage in default or at risk. The agency lists HUD-certified counselors by county, and says counseling is free or minimal in cost.
• ERMA: the agency’s pandemic-era Emergency Rescue Mortgage Assistance program states it is no longer accepting applications.
• Legal help: the Judiciary points to Legal Services of New Jersey for those who qualify, and to county bar referral services.

Tenants and lead rules

Legitimate tenants may remain in a foreclosed home until a court process removes them, according to the Judiciary’s FAQs. Federal lead-paint disclosure rules, by contrast, do not apply to foreclosure sales, per EPA. See our tenant rights page.