Signed by Governor Jon Corzine

Vote Smart's Synopsis:

Vote to concur with House amendments and pass a bill that appropriates $25 million to establish and administer the Mortgage Stabilization Program, appropriates $15 million to establish and administer the New Jersey Housing Assistance and Recovery Program, and establishes additional regulations on creditors pursuing foreclosures.

Highlights:

- Establishes the Mortgage Stabilization Program to assist homeowners and lenders willing to refinance covered mortgages in order to ensure that mortgage payments are affordable, and defines "affordable mortgage payment" as a payment that does not exceed 33 percent of the household's monthly average gross income or the applicable percentage of household monthly average gross income required by governmental or private first mortgage loan insurance, whichever is greater (Secs. 4-5). - Specifies that the Mortgage Stabilization Program shall provide the following types of loans (Secs. 4-5):

- Mortgage Stabilization Program Loan: a non-amortizing (no monthly payment) second mortgage loan equal to one-half of the difference between the new first mortgage loan amount and the appraised value of the subject's property, but not to exceed $25,000 per loan, with proceeds going to the covered mortgage lender; and - Mortgage Lender Loan: a loan provided by a lender that is secured by a lien holding second priority and is equal to one half of the difference between the new first mortgage loan and the current appraised value of the property.

- Prohibits homeowners from participating in the Mortgage Stabilization Program if their income exceeds 120 percent of the area median income or the New Jersey Housing and Mortgage Finance Agency's Mortgage Revenue Bond Program income limits, whichever is greater (Secs. 4-5). - Establishes a Housing Assistance and Recovery Program Support Fund to provide support and aid to sponsors (non-profit organizations or a public entities) to establish a Housing Assistance and Recovery Program, under which the sponsor purchases the homeowner's property and leases the property to the homeowner for up to 36 months, after which the property will be sold back to the homeowner or another member of the household at a price that shall not exceed the price at which the sponsor purchased the property plus "reasonable" sponsor maintenance costs (Secs. 9-11). - Requires creditors that file a complaint of foreclosure on a high risk mortgage to allow the borrower six months to pursue a loan workout, loan modification, refinancing, or other alternatives through mediation sponsored by the Administrative Office of the Courts, during which time the interest rate on the covered mortgage loan shall not increase and foreclosure shall not be pursued (Sec. 16). - Specifies that if residential property becomes vacant after a creditor files a notice of intention to foreclose and the property is found to be a nuisance or in violation of any state or local code, the creditor is required to abate the nuisance or correct the violation (Sec. 17).

Full Bill Text

Vote Smart's Synopsis:

Vote to pass a bill that appropriates $25 million to establish and administer the Mortgage Stabilization Program, appropriates $15 million to establish and administer the New Jersey Housing Assistance and Recovery Program, and establishes additional regulations on creditors pursuing foreclosures.

Highlights:

- Establishes the Mortgage Stabilization Program to assist homeowners and lenders willing to refinance covered mortgages in order to ensure that mortgage payments are affordable, and defines "affordable mortgage payment" as a payment that does not exceed 33 percent of the household's monthly average gross income or the applicable percentage of household monthly average gross income required by governmental or private first mortgage loan insurance, whichever is greater (Secs. 4-5). - Specifies that the Mortgage Stabilization Program shall provide the following types of loans (Secs. 4-5):

- Mortgage Stabilization Program Loan: a non-amortizing (no monthly payment) second mortgage loan equal to one-half of the difference between the new first mortgage loan amount and the appraised value of the subject's property, but not to exceed $25,000 per loan, with proceeds going to the covered mortgage lender; and - Mortgage Lender Loan: a loan provided by a lender that is secured by a lien holding second priority and is equal to one half of the difference between the new first mortgage loan and the current appraised value of the property.

- Prohibits homeowners from participating in the Mortgage Stabilization Program if their income exceeds 120 percent of the area median income or the New Jersey Housing and Mortgage Finance Agency's Mortgage Revenue Bond Program income limits, whichever is greater (Secs. 4-5). - Establishes a Housing Assistance and Recovery Program Support Fund to provide support and aid to sponsors (non-profit organizations or a public entities) to establish a Housing Assistance and Recovery Program, under which the sponsor purchases the homeowner's property and leases the property to the homeowner for up to 36 months, after which the property will be sold back to the homeowner or another member of the household at a price that shall not exceed the price at which the sponsor purchased the property plus "reasonable" sponsor maintenance costs (Secs. 9-11). - Requires creditors that file a complaint of foreclosure on a high risk mortgage to allow the borrower six months to pursue a loan workout, loan modification, refinancing, or other alternatives through mediation sponsored by the Administrative Office of the Courts, during which time the interest rate on the covered mortgage loan shall not increase and foreclosure shall not be pursued (Sec. 16). - Specifies that if residential property becomes vacant after a creditor files a notice of intention to foreclose and the property is found to be a nuisance or in violation of any state or local code, the creditor is required to abate the nuisance or correct the violation (Sec. 17).

Full Bill Text