(TRENTON) – Legislation sponsored by Assembly Speaker Vincent Prieto and Assemblymen Daniel R. Benson, Benjie E. Wimberly, Paul D. Moriarty and Carmelo G. Garcia that would empower municipalities to take action against creditors who fail to maintain vacant properties that are slated for foreclosure was signed into law on Friday.
The new law (A-1257) gives municipal officials the authority to issue citations and impose fines to ensure that creditors fulfill their responsibility to maintain unoccupied residential properties on which a summons and complaint in an action to foreclose has been filed.
“Vacant properties are neighborhood eyesores that attract pests and criminal activity and drag down property values,” said Prieto (D-Bergen/Hudson). “Municipalities will now be able to take action against creditors who create nuisance situations for neighborhoods and municipalities by failing to maintain vacant properties that are set for foreclosure.”
“It’s simply unfair that individuals who put in the time and effort to maintain their properties suffer because the owners of surrounding vacant properties don’t make a similar investment,” said Benson (D-Mercer/Middlesex). “Diligent property owners deserve the defense against the negligence of others that this new law provides.”
“Aside from just being unsightly, abandoned houses and vacant lots bring down the quality of life in a community,” said Wimberly (D-Bergen/Passaic). “Now, New Jersey law will help us ensure the safety, beauty and overall value of New Jersey neighborhoods.”
“Vacant properties are often associated with increases in crime and decreases in home values,” said Moriarty (D-Camden/Gloucester). “This new law is an important step in our collective effort to revitalize communities across the state.”
“Unfortunately, given the recent economic downturn, the reality is that a number of homeowners simply cannot afford to keep their houses,” said Garcia (D-Hudson). “Having a rundown vacant property in the neighborhood makes it much harder for them to sell their homes, because that one property depreciates the value of every surrounding house. In part, this new law will help put an end to that domino effect.”
The law now states that in-state creditors found to be in violation of any ordinance, rule or regulation adopted pursuant to the law would be subject to a minimum fine of $1,500 for each day of the violation. Out-of-state creditors would be subject a $2,500 fine, at minimum. At least 20 percent of any money collected would have to be used for code enforcement purposes.
The new law also requires out-of-state creditors foreclosing on a residential property to designate an in-state person or entity responsible for maintenance of the property.
Of the top 10 U.S. cities hardest hit by the housing crisis, three – Newark, Elizabeth and Paterson – are in New Jersey, according to a recent Haas Institute study.