The New Jersey Residential Mortgage Foreclosure Mediation Program(FMP) is intended to give a homeowner in a foreclosure proceeding the opportunity to qualify for mortgage modification. Homeowners who may benefit should carefully review the procedures outlined below and diligently pursue the remedies that the FMC may provide. However, a homeowner should fully understand that mediation does not mandate that one party accept the proposed resolution offered by the other and it has been our experience that banks sometimes appear to prefer a sheriff’s sale to a loan modification. Therefore, all other legal remedies which may be available should also be fully considered. Homeowners qualify for the Foreclosure mediation program in Edison if (1) they are the owner occupant of a one- to three-family residential property; (2) the property is their primary residence; and (3) they are the borrower on the mortgage loan being foreclosed.
Initially, a homeowner who sought bankruptcy relief was not eligible to participate in the FMP. The Bankruptcy Court recognized the benefits of the program and adopted a vicinage order permitting lenders to participate even though the homeowner had filed for bankruptcy protection. See General Order Clarifying That Participation in the New Jersey Foreclosure Mediation Program Does Not Violate the Automatic Stay (May 18, 2009).
A Foreclosure Mediation Financial Worksheet and supporting documentation must be submitted by a homeowner to provide proof that they have the financial ability to make the payments required by a modified mortgage. While a homeowner need not have the assistance of a housing counselor or attorney, it is clear these advisors may attend the mediation session and provide the homeowner with assistance in completing the required paperwork. The mediator and the housing counselor are free. Qualified homeowners are provided with legal representatives who contract with the New Jersey Housing and Mortgage Finance Agency. These attorneys provide free legal services to income-eligible homeowners participating in the FMP.
– The outline below of New Jersey’s Residential Mortgage Foreclosure Mediation Program (FMP). was digested from the comprehensive discussion of the FMP presented by the the Court in U.S. BANK NAT. ASS’N v. WILLIAMS, 415 N.J. Super. 358 (App. Div. 2010).
Represented homeowners receive the following services from their appointed attorneys:
For Additional Information – See FMP website: http://www.nj.gov/foreclosuremediation/