Published February 11, 2017
By MaryAnn Spoto

TRENTON -- New Jersey homeowners facing foreclosure while they're still trying to rebuild from Hurricane Sandy now can be protected from losing their homes.

A bill signed Friday by Gov. Chris Christie gives certain homeowners affected by Sandy the potential to ward off foreclosures for up to three years while they try to recover financially from the storm.

In his signing statement, Christie indicated he wasn't completely happy with the bill (S-2300, A-333), which he said was too broadly written to include foreclosures not precipitated by Sandy.

But the signing was welcome news to members of the New Jersey Organizing Project, a grass-roots group of Sandy victims and other housing advocates who have been waiting two years for the governor to take action.

"I'm happy today," said Joe Mangino, co-founder of the project. "It's a relief for us because it's been two long years."

Last fall, Christie incurred the wrath of Sandy victims at an appearance in Seaside Heights where they complained many were still not home and faced financial ruin because of the state's slow process in disbursing federal Sandy aid to rebuild.

At that time, Christie said he would take another look at the foreclosure bill, but many, including Mangino, said they were skeptical Christie would sign it.

"For all the families struggling to keep their heads above water, there's hope," said Staci Berger, president and chief executive officer of the Housing and Community Development Network of New Jersey. "Our families, friends, and neighbors deserve better than what they've been forced to endure over the last four years. Because of the hard work and dedication of our legislative leaders, Sandy survivors, and advocates, there will finally be some relief and the chance to rebuild."

The law creates a forbearance period for up to three years for Sandy victims who have either been approved for help through the Reconstruction, Rehabilitation, Elevation and Mitigation Program or the Low-to-Moderate Income Program or those who have received rental assistance through the Federal Emergency Management Agency for damage to their primary residence.

Those approved would receive a certificate of eligibility for mortgage forbearance from the state Department of Community Affairs, allowing them to tack onto the end of their mortgage the months they missed paying during their Sandy recovery.

They would still be responsible for paying their taxes and insurance.

The forbearance period would end when one of the three following scenarios occurs first:

one year after the certificate of occupancy for recovery and rebuilding of the home is issued;
July 1, 2019;
or 10 days after a sheriff's sale for a property already in foreclosure.
Thousands of homeowners would be eligible for help under this law, Mangino said.

That includes Sandy victims who were facing foreclosure before the storm hit or whose mortgage default problems were unrelated to storm damage. Christie said he didn't want it as part of the law because he said it would cause "mountains of damage" to "our federal funding flow and our state housing market."

"I am very concerned these new requirements may adversely impact the state's recovery efforts, jeopardize federal Sandy funding, increase borrowing costs and ultimately delay Sandy-impacted residents' return to their homes," he wrote.

Calling the bill "sloppily written" and "ill conceived," Christie accused its Democratic sponsors of "politically pandering" to Sandy victims during to get re-elected.

He said that for mortgage forbearance certifications, he is directing the Community Affairs commissioner to give priority to Sandy victims whose foreclosure situations are related to their reconstruction.

"I have chosen to sign it to give Sandy victims the morsels of relief this vanity exercise of a bill offers," Christie wrote in response to the Assembly bill, sponsored by all Democrats.

Sen. Jennifer Beck, many of whose constituents in Monmouth County were hit hard by Sandy, was the only Republican sponsors of the companion bills kicking around in the in the Senate and Assembly for two years.

The new law directs the Community Affairs commissioner to notify Sandy families of their eligibility for those foreclosure protections and to post eligibility information on the department's website.

The commissioner also must notify courts and mortgage lenders of people who are eligible for those protections.

The Department of Community Affairs will be required to extend the completion deadline for projects funded through RREM and LMI, for applicants who can demonstrate the delay was the fault of their builder or because of Community Affairs' delays in approving the builder doing the work. If an application for aid under the Tenant-Based Rental Assistance Program (TBRA), LMI, or RREM program is denied, Community Affairs would have to provide the applicant with an explanation for the denial, and an explanation for ways to remedy the application.

MaryAnn Spoto may be reached at [email protected]. Follow her on Twitter @MaryAnnSpoto. Find NJ.com on Facebook.