An Act protecting a homeowner in foreclosure from excessively low intervening offer and amending P.L.1954, c.186.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 1 of P.L.1954, c.186 (C.54:5-89.1) is amended to read as follows:
1. In any action to foreclose the right of redemption in any property sold for unpaid taxes or other municipal liens, all persons claiming an interest in or an encumbrance or lien upon such property, by or through any conveyance, mortgage, assignment, lien or any instrument which, by any provision of law, could be recorded, registered, entered or filed in any public office in this State, and which shall not be so recorded, registered, entered or filed at the time of the filing of the complaint in such action shall be bound by the proceedings in the action so far as such property is concerned, in the same manner as if [he] the person had been made a party to and appeared in such action, and the judgment therein had been made against [him] the person as one of the defendants therein; but such person, upon causing such conveyance, mortgage, assignment, lien, claim or other instrument to be recorded, registered, entered or filed as provided by law, may apply to be made a party to such action. No person, however, shall be admitted as a party to such action, nor shall [he] the person have the right to redeem the lands from the tax sale whenever it shall appear that [he] the person has acquired such interest in the lands for [a nominal consideration] less than fair market value after the filing of the complaint, except where such transferee is related by blood or marriage to, or who, because of other close or personal relationship with the transferor, would in normal course be a party to an instrument for little or no consideration, or where such party acquired his interest at a judicial sale.
(cf: P.L.1967, c.149, s.1)
2. This act shall take effect immediately.
STATEMENT
This bill protects a homeowner in foreclosure from an excessively low intervening offer.
This bill amends P.L.1954, c.186 (C.54:5-89.1) to prohibit a person who has acquired an interest in a parcel of real property for less than the fair market value of that property, after the filing of the foreclosure complaint, from being admitted as a party to the foreclosure action and also from exercising the right of redemption. Under current law, an individual is prohibited from exercising the right of redemption after acquiring an interest in land for a nominal consideration after the filing of the foreclosure complaint.
Protects homeowner in foreclosure from excessively low intervening offer.