Bill Text: NJ S1804 | 2022-2023 | Regular Session | Introduced
Bill Title: Clarifies exceptions regarding requirement for person seeking to be made party in certain foreclosure actions.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2022-02-28 - Introduced in the Senate, Referred to Senate Community and Urban Affairs Committee [S1804 Detail]
Download: New_Jersey-2022-S1804-Introduced.html
Sponsored by:
Senator TROY SINGLETON
District 7 (Burlington)
SYNOPSIS
Clarifies exceptions regarding certain requirements for person seeking to be made party in certain foreclosure actions.
CURRENT VERSION OF TEXT
As introduced.
An Act clarifying exceptions regarding requirement for person seeking to be made party in certain foreclosure actions 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. a. 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 the person had been made a party to and appeared in such action, and the judgment therein had been made against 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.
b. No person, however, shall be admitted as a party to such action, nor shall the person have the right to redeem the lands from the tax sale whenever it shall appear that the person has acquired such interest in the lands for less than fair market value after the filing of the complaint, except where [such] :
(1) the transferor acknowledges through a written certification that the transferor has reviewed an appraisal of the fair market value of the property from a real estate appraiser licensed by the State and knowingly and voluntarily consents to convey the property to the transferee for less than fair market value;
(2) the transferor acknowledges through a written certification that the transferor was advised of the right to seek such an appraisal, but knowingly and voluntarily consents to convey the property to the transferee without an appraisal and for less than fair market value;
(3) the 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] (4) the party acquired his interest at a judicial sale.
(cf: P.L.2021, c.231, s.1)
2. This act shall take effect immediately.
STATEMENT
This bill would clarify the exception under P.L.1954, c.186 (C.54:5-89.1) which allows a person with an interest in a parcel of real property to be admitted to a foreclosure proceeding in cases where less than fair market value has been paid for such interest in the property. Currently, only persons who are related by blood or marriage or who have another close personal relationship with a transferor of real property or if the person acquired an interest in the property through judicial sale, may become a party to the foreclosure action when less than fair market value has been paid for the property interest. This bill clarifies that when a transferor certifies that a licensed real estate appraiser has provided an appraisal on the fair market value, or if the transferor acknowledges the right to receive such an appraisal, but nonetheless chooses to convey the property for less than fair market value, the transferee in such circumstances may also become a party to the foreclosure proceeding.
