New Rules for New Jersey Sheriff’s Sales – Adjournments
You Can Adjourn a New Jersey Sheriff's Sale for 60 to 150 Days
On April 29, 2019, Governor Phil Murphy signed into law foreclosure reforms that would shorten the time for New Jersey foreclosures. The new law (S3464) makes significant changes to the rules of the road when a foreclosure case reaches the point of a sheriff’s sale. The new law has good news and bad news for homeowners facing foreclosure.
First, the bad news. The total time from a final judgment to a sheriff’s sale got shorter. The bill expressly states that it is amending the “Fair Foreclosure Act” for the purpose of expediting residential mortgage foreclosures. Whereas the time could be extended indefinitely under the old law, now there is a hard and fast limit of 150-days. More on that in a moment, but how do you get this additional time in the first place?
Homeowner’s Facing Foreclosure Have “Statutory Stays” or “Adjournments’ They Are Entitled to as a Matter of Right
Most individuals whose house has gone into foreclosure and is pending a sale are not aware that they now have the right to get an additional sixty (60) days before a sheriff’s sale is held by exercising their “statutory stays” under N.J.S.A. 2A:17-36. This has gone up from twenty-eight (28) days under the old law.
Adjournments Limited to Five (5) 30-Day Adjournments or 150-days
The law amends N.J.S.A. 2A:17-36 to limit the number of adjournments to five (5) total 30-day adjournments, which can be exercised as follows:
- Two (2) adjournments of 30-days each at the request of the debtor (homeowner);
- Two (2) adjournments of 30-days each at the request of the lender (mortgage company);
- One (1) adjournment of 30-days by consent of the debtor and the lender; and
- “And no more… however, a court of competent jurisdiction may, for cause, order further adjournments.”
Thus, sales can be adjourned as a matter of right for 60-days, and a homeowner can get a further extension of 90-days if the lender (mortgage company) agrees to push the sale back. That means 150 days is the total possible amount of additional time without a court order from a Superior Court Judge.
Sheriff’s Sale Must Be “Conducted” Within 150-days or Must be Cancelled
Here is where things get tricky. Another change to the law (S3464) states that a sheriff must conduct a foreclosure sale within 150-days of receiving the writ of execution – the document the lender (mortgage company) sends in to initiate the sale.
Under the old law, the rule was that the Sheriff had to “schedule” the sale within 120 days. Thus, lenders would call the Sheriff once a sale was “scheduled” and put sales off sometimes for years, but would keep them “scheduled” on the calendar. As the law stands today, if the adjournments extend the time beyond 150-days, then the lender has to cancel the sale and re-file.
What does this mean? It is still playing out in Court and being interpreted. It doesn’t mean that if the lender busts the 150-day limit that they are barred from doing a sale. It just means that absent some court order to the contrary, the sale has to be cancelled and a new writ submitted. The plaintiff’s foreclosure bar and defense foreclosure bar are both making different arguments on a case-by-case basis and this rule provides some interesting opportunities, but from a practical perspective it simply serves to “expedite foreclosures” and prevent lenders or borrowers from stringing cases out indefinitely without having added, costly and painful hurdles to jump through.
Post a comment
Post a Comment to "New Rules for New Jersey Sheriff’s Sales – Adjournments"To reply to this message, enter your reply in the box labeled "Message", hit "Post Message."