Published December 14, 2012
By David Levinsky

TRENTON — A bill intended to help reduce New Jersey’s glut of foreclosed homes was signed into law by Gov. Chris Christie last week, but the fate of a controversial second bill designed to tackle the issue remains uncertain.

The bill signed Dec. 6 allows expedited foreclosure proceedings in state courts for abandoned properties by permitting banks and other lenders to apply to a judge for a speedy summary judgment provided the home is vacant.

The second measure, known as the Residential Foreclosure Transformation Act, directs the New Jersey Housing and Mortgage Finance Agency to create a program to provide loans and financing to developers or other nonprofit groups to purchase foreclosed properties for resale or rent as either affordable- or market-rate housing.

Both bills are backed by the New Jersey Bankers Association, the New Jersey Builders Association and affordable housing advocates, who claim the two measures will help get thousands of abandoned homes in disrepair sold and rehabilitated, boosting the housing market and reducing blight in neighborhoods.

More than 61,000 New Jersey homes were in foreclosure last month, or roughly one out of every 992 homes, according to the website RealtyTrac.com.

Burlington County’s foreclosure rate of one out of every 960 homes ranks 11th among New Jersey’s 21 counties, but certain areas, such as Willingboro and Pemberton Township, have much higher rates.

Both the speedy foreclosures bill and the Transformation Act cleared the Democrat-dominated Legislature earlier this fall, but only the expedited foreclosure bill received Republican support. It is expected to reduce the average time for a foreclosure to move through state courts to sheriffs’ sales from one year or longer to three or four months.

Assemblyman Anthony M. Bucco, R-25th of Boonton, said the law would help address the problems related to abandoned homes while maintaining protections for homeowners.

“When there is clear evidence and no dispute that a residence is abandoned, we can eliminate bureaucracy and allow the lawful owner to improve a property and remove an eyesore in a community without legal delay,” Bucco said in a statement after Christie signed the measure. “I thank Gov. Christie for signing this law, which will reduce court backlogs and, more importantly, remove blighted properties from our communities without an overly lengthy process.”

Unlike the expedited foreclosure bill, which sailed through the Legislature with no opposition, the Transformation Act has been strongly opposed by the conservative group Americans for Prosperity-New Jersey as a bailout for banks and lenders.

Christie vetoed an earlier version of the bill because he claimed it would boost state spending.

In response, the bill’s Democratic sponsors rewrote it and inserted language specifying that no state money would be expended and that the program would rely on funds provided by the federal government or from municipalities with unspent money dedicated for affordable housing.

Christie has not publicly commented on the revised measure.

Staci Berger, director of the Housing and Community Development Network of New Jersey, said that the expedited foreclosure measure would assist communities plagued with foreclosures, but that the second bill also deserves Christie’s signature.

“The network stands behind proposals that can restore vibrancy and economic vitality to distressed and struggling neighborhoods around the state,” Berger said. “One such proposal establishes a temporary program within the Housing and Mortgage Finance Agency for the purposes of purchasing foreclosed residential properties from institutional lenders for market or affordable housing. We encourage the governor to view this bill as part of the comprehensive solution for economic recovery and sign this bill into law as well.”

Steve Lonegan of Americans for Prosperity, formerly mayor of Bogota, said he is confident Christie will reject the bill a second time.

“It’s another ridiculous bailout that the state can’t afford,” Lonegan said. “We’re confident the governor will veto it.”