A Brief Overview of New Jersey’s Foreclosure Mediation Program

In response to the ongoing foreclosure crisis in the US, many states have implemented foreclosure mediation programs for assisting borrowers in finding ways to avoid foreclosure. You may be eligible to participate in the state’s foreclosure mediation program if you are a homeowner facing foreclosure in New Jersey.

It is important to understand some of the basics if you are facing foreclosure in New Jersey. There are two types of foreclosures – judicial and non-judicial. A judicial foreclosure goes through court whereas non-judicial does not. New Jersey is a judicial state so the foreclosure process is done through the court. Read on to learn more about how the foreclosure mediation program works and how borrowers can benefit from the process.

What is foreclosure mediation?

It is a process which is used for helping homeowners avoid foreclosure by coming up with an alternate solution that benefits both the lenders and the borrowers.

New Jersey foreclosure mediation

The state of New Jersey has established a mediation program for providing certain eligible homeowners in foreclosure with the right to mediation.

Cost to participate in mediation

If you are eligible for the New Jersey foreclosure mediation program then there is no fee to participate in it.

Eligibility for foreclosure mediation

Homeowners who are facing foreclosure in New Jersey are eligible for foreclosure mediation if the property is the primary residence of the borrower and is a 1-3 unit owner-occupied residential property.

How New Jersey’s foreclosure mediation program works

Once the court receives the required forms, the material will be distributed to the staff of the local courthouse and to the lender’s attorney. The local courthouse assigns a mediator to the borrower and sets a date for the mediation.

Who must attend mediation?

The mediator, the homeowner, the lender’s attorney and a representative of the lender are some of the people who can attend the foreclosure mediation NJ.

Potential outcomes of mediations

Mediation consists of a meeting between the lender, the borrowers, and an impartial third party, which is known as the mediator. They discuss the financial situation of the borrower and try to negotiate an alternative way for the borrower to keep the home without going through the painful procedures of a foreclosure. In many cases, they are able to reach an agreement, by working together.

Some of the potential outcomes of mediations are:

• Deed in lieu of foreclosure
• Loan modification
• Short sale
• Forbearance agreement
• Payment agreement

Should you participate in the foreclosure mediation program?

It is important to understand that participating in a foreclosure mediation program does not guarantee that a foreclosure will be avoided. But since the foreclosure mediation programs are free of cost so it doesn’t hurt to try. The lender may be more likely to agree to a non-foreclosure during the foreclosure mediation program than if you approach it outside of the program.

We are here for you if you ever need any advice. Contact us today at info@turbohomesolutions.com or 973-963-7776.