For immediate release: October 16, 2008
For further information contact: Winnie Comfort or Tammy Kendig
Judiciary Announces Foreclosure Mediation Program
to Assist Homeowners at Risk of Losing Their Homes
Chief Justice Stuart Rabner today announced the roll-out of a statewide Judiciary program to assist homeowners in foreclosure actions. The program will provide mediators to help homeowners and lenders negotiate with one another and try to work out agreements to avoid foreclosures.
Chief Justice Rabner said, "While the courts must remain neutral in all foreclosure matters, it is in everyone's best interest to have a forum where homeowners facing foreclosure have the opportunity to negotiate to save their homes. Our goal is to get lenders and borrowers to meet at the table and work out a mutually beneficial arrangement. I encourage continued cooperation among the courts, lenders, borrowers, and the bar as we address the increasing number of foreclosure actions in New Jersey in today's difficult economic times."
Under the program, the courts will require mediation in all cases in which homeowners contest owner-occupied foreclosure actions. Volunteer mediators will meet with eligible homeowners and their lenders in an effort to resolve the foreclosure action and renegotiate the terms of mortgage agreements.
In uncontested actions, where the homeowner has failed to respond to a foreclosure complaint, the courts will notify the homeowner of the mediation program and encourage participation. If the homeowner fails to respond and a default judgment is entered, mediation will remain an option before the matter proceeds to a sheriff's sale.
The Chief Justice praised Middlesex Vicinage Assignment Judge Travis L. Francis for spearheading an innovative pilot project on foreclosure mediation. The program is operating in the Middlesex Vicinage, where volunteers from the Middlesex County Bar Association are providing free mediation services for homeowners facing foreclosure. General Equity Presiding Judge Frank M. Ciuffani has been working closely with representatives from the bar, Legal Services, and other agencies to build awareness of the program.
"The worst thing a homeowner facing a foreclosure action can do is nothing. It is critical to let homeowners know that even after a default action has been entered, there may still be a window of opportunity for borrowers and banks to work out an agreement that will avoid a sheriff's sale," said Judge Francis.
The Judiciary will expand Middlesex's model mediation program throughout the state in the coming months. In the next 30 days, the program will be expanded to Essex, Union, Ocean, Camden, Bergen, and Hudson counties, which had the highest number of recent foreclosure filings. Within 60 days, the project will be in place in all 21 counties.
During the past 12 months, the courts received 46,130 residential foreclosure filings, a 46 percent increase from the previous 12 months, when 31,667 filings were received.
In September 2008, the courts received 3,997 residential foreclosure filings, compared to 1,400 filings in September 2006.
For more information on foreclosure mediation, homeowners can call 609-292-8470.