SENATE, No. 1250

STATE OF NEW JERSEY

214th LEGISLATURE

INTRODUCED FEBRUARY 8, 2010

 


 

Sponsored by:

Senator† RONALD L. RICE

District 28 (Essex)

 

 

 

 

SYNOPSIS

†††† Creates cause of action for failure to maintain certain vacant properties; requires out-of-state creditors to designate in-State representative.

 

CURRENT VERSION OF TEXT

†††† As introduced.

††


An Act concerning the maintenance of certain residential properties, supplementing chapter 48 of Title 40 of the Revised Statutes and amending P.L.2008, c.127.

 

†††† Be It Enacted by the Senate and General Assembly of the State of New Jersey:

 

†††† 1. (New section)† a.† The governing body of any municipality may make, amend, repeal and enforce ordinances to regulate the care, maintenance, and upkeep of vacant residential properties on which a notice of intention to foreclose has been filed.

†††† b.† An ordinance adopted pursuant to subsection a. of this section shall provide that the person or entity filing the notice of intention to foreclose shall be responsible for the maintenance and upkeep of the vacant residential property, and if located out-of-State, shall be responsible for appointing an in-State agent to act for the foreclosing person or entity.

†††† c.† A creditor found by the municipal court of the municipality in which the property is located, or any other court of competent jurisdiction, to be in violation of any ordinance, rule, or regulation adopted pursuant this section shall be subject to a fine of $2,500, payable by the creditor, for each day of the violation.

†††† d.† No less than 20 percent of any money collected pursuant to subsection a. of this section shall be utilized by the municipality for municipal code enforcement purposes.

 

†††† 2.† Section 17 of P.L.2008, c.127 (C.46:10B-51) is amended to read as follows:

†††† 17. a. A creditor serving a notice of intention to foreclose on a mortgage on residential property in this State shall serve the public officer of the municipality in which the property is located, or, if the municipality has not designated a public officer pursuant to P.L.1942, c.112 (C.40:48-2.3 et seq.), the municipal clerk, with a copy of the notice at the same time it is served on the owner of the property. In the event that the property being foreclosed is an affordable unit pursuant to the "Fair Housing Act," then the creditor shall identify that the property is subject to the "Fair Housing Act." The copy served on the public officer or municipal clerk shall include the full name and contact information of an individual located within the State who is authorized to accept service on behalf of the creditor.

†††† b.††† If a residential property becomes vacant at any point subsequent to the creditor's filing the notice of intention to foreclose, but prior to vesting of title in the creditor or any other third party, and the property is found to be a nuisance or in violation of any applicable State or local code, the local public officer or municipal clerk shall notify the creditor, which shall have the responsibility to abate the nuisance or correct the violation in the same manner and to the same extent as the title owner of the property, to such standard or specification as may be required by the public officer or municipal clerk.

†††† c.†††† (1)† If the municipality expends public funds in order to abate a nuisance or correct a violation on a residential property in situations in which the creditor was given notice pursuant to the provisions of subsection b. of this section but failed to abate the nuisance or correct the violation as directed, the public officer or municipal clerk shall have the same recourse against the creditor as it would have against the title owner of the property, including but not limited to the recourse provided under section 23 of P.L.2003, c.210 (C.55:19-100).

†††† (2)† Any out-of-State creditor that has served a notice of intention to foreclose on a residential property, that subsequently becomes vacant, shall designate an in-State representative who shall be responsible for the care, maintenance, and up-keep of the vacant property.† The out-of-State creditor shall inform the public officer of the municipality in which the property is located, or, if the municipality has not designated a public officer pursuant to P.L.1942, c.112 (C.40:48-2.3 et seq.), the municipal clerk of the in-State representative responsible for maintenance of the property.

(cf: P.L.2008, c.127, s.17)

 

†††† 3.† This act shall take effect immediately.

 

 

STATEMENT

 

†††† This bill provides for a cause of action against creditors who are in the process of foreclosing on a residential property that is vacant if the property falls into disrepair.† In the event a property to which a notice of intention to foreclose has been sent and the resident has vacated the property, the appropriate municipal code enforcement official may issue a citation against the creditor if the condition of the property is found to be in violation of a municipal ordinance, rule, or regulation.† The court may impose a fine on the creditor of up to $2,500 for each day the property is deemed to have been in violation.† The bill provides that least 20 percent of any money collected through this provision be allocated to for municipal code enforcement purposes.

†††† The bill requires out-of-state creditors who have served a notice of intention to foreclose on a residential property to designate an in-state person or entity responsible for the care, maintenance, and up-keep of the property.†

†††† It is the sponsorís intent that this bill ensure the safety of the residents and the property values of homes in neighborhoods that are the victims of the foreclosure crisis.† Vacant foreclosed properties lead to drug crime, prostitution, vandalism, and other crimes that lower the value of the homes and businesses in the surrounding area.† This creates a downward spiral that can result in the destruction of entire neighborhoods.