Governor Acts on Foreclosure Prevention Measure

SAYREVILLE – To ease the burden of foreclosure facing thousands of homeowners throughout New Jersey, Gov. Jon S. Corzine on Monday, Dec. 1 signed A3459/S8, allocating $12.5 million in state funds and $51.4 million in federal funds for foreclosure prevention assistance.
“During these unsettling economic times, we must remain committed to meeting the basic needs of New Jersey residents – shelter being chief among them,” said Corzine in a release. “By addressing the foreclosure issue head-on, we will keep families safe, keep communities strong, and preserve local economies throughout the Garden State.”
In his Economic Assistance and Recovery Plan, the governor proposed several measures to promote foreclosure prevention, including strengthening counseling opportunities available to homeowners in distress. The Department of Community Affairs (DCA) will receive $12 million in grant-in-aid funds to provide these additional mediation and counseling opportunities through the New Jersey Housing and Mortgage Finance Agency.
In addition, the Administrative Office of the Courts will receive $500,000 to provide mediation services to homeowners prior to foreclosure proceedings. Mediation will be imposed in the state’s seven hardest hit counties with the goal of helping homeowners stay in their homes. Counselors certified by the U.S. Department of Housing and Urban Development (HUD) will be part of the mediation process.
“Nothing in the current crisis is as frightening as the specter of thousands of New Jerseyans losing their homes to foreclosure in the midst of winter,” said Assembly Majority Leader Bonnie Watson Coleman (D-Mercer). “We need to provide this lifeline to the countless families who might otherwise find themselves homeless at the worst possible time.”
The bill also appropriates approximately $51.4 million in federal funds to DCA for the Neighborhood Stabilization Program. A component of the Housing and Economic Recovery Act of 2008, the program works to stabilize neighborhoods experiencing the negative effects of the subprime mortgage crisis and the general economic downturn. Funds from the NSP can be used for property acquisition, demolition, rehabilitation and for the creation and operation of land banks, in any combination, to spur neighborhood recovery. DCA will receive the $51.4 million after HUD approval of its proposed Action Plan.
“When a home is foreclosed upon, it isn’t just families who are affected,” said Senator Ronald L. Rice (D-Essex). “We have seen, first hand, that the negative impact creates a domino effect that leads to an increase in crime and a decrease in area property values. By investing some state dollars, we will get an even larger amount from the federal government. The combined funding will go along way toward helping families in New Jersey.”
Senators Ronald L. Rice (D-Essex) and John A. Girgenti (D-Bergen, Passaic) were primary sponsors of the bill in the Senate.
Primary bill sponsors in the Assembly included Assembly Majority Leader Bonnie Watson Coleman (D-Mercer) and Assemblymen Jerry Green (D-Middlesex, Somerset, Union), Ralph R. Caputo (D- Essex), John J. Burzichelli (D –Salem, Cumberland, Gloucester) and Joseph Vas (D- Middlesex).