Extends foreclosure protections for certain homeowners impacted by remnants of Hurricane Ida.

A5118

ASSEMBLY, No. 5118

STATE OF NEW JERSEY

222nd LEGISLATURE

�

INTRODUCED MAY 18, 2026

Sponsored by:

Assemblyman� JOHN DIMAIO

District 23 (Hunterdon, Somerset and Warren)

Assemblyman� ERIK PETERSON

District 23 (Hunterdon, Somerset and Warren)

Co-Sponsored by:

Assemblyman Scharfenberger

SYNOPSIS

���� Extends foreclosure protections for certain
homeowners impacted by remnants of Hurricane Ida.

CURRENT VERSION OF TEXT

���� As introduced.

��

An Act
extending foreclosure protections for certain
homeowners impacted by remnants of Hurricane Ida and amending P.L.2024, c.85.

����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:

���� 1.� Section 2 of P.L.2024,
c.85 (C.52:15D-16) is amended to read as follows:

���� 2. a. A person who meets the
eligibility criteria set forth in subsection b. of this section may file an
application with the Department of Community Affairs, requesting a
Certification of Eligibility for Forbearance, online through a system
established by the department.� The department shall publish instructions for
filing an application requesting a Certification of Eligibility for Forbearance
on its Internet website by no later than 60 days after the enactment of
P.L.2024, c.85 (C.52:15D-15 et seq.).� The department shall make the online
application system publicly available by no later than 90 days after the
enactment of P.L.2024, c.85 (C.52:15D-15 et seq.).� All applications must be
submitted to the department by no later than 30 days following the date on
which the department makes the online application system publicly available
pursuant to this section.

���� b.��� To qualify for a
Certification of Eligibility for Forbearance, an applicant must satisfy the
following eligibility criteria:

���� (1)�� meet the definition of
"storm-impacted homeowner" pursuant to section 1 of P.L.2024, c.85
(C.52:15D-15);

���� (2)�� have a current mortgage
obligation on their primary residence; and

���� (3)�� submit a complete
application to the department that satisfies the requirements set forth in
P.L.2024, c.85 (C.52:15D-15 et seq.).

���� A storm-impacted homeowner
shall be eligible for a forbearance regardless of whether the storm-impacted
homeowner's primary residence is already the subject of a foreclosure
proceeding.

���� c.���� To be deemed complete,
an application for a Certification of Eligibility for Forbearance must comply
with the instructions for filing published by the department and include copies
of the following materials:

���� (1)�� documentation
demonstrating that the applicant meets the definition of storm-impacted
homeowner pursuant to section 1 of P.L.2024, c.85 (C.52:15D-15);

���� (2)�� proof that the applicant
has a current mortgage obligation on their primary residence;

���� (3)�� a written attestation by
the applicant under penalty of law that:

���� (a)�� the information
submitted to the department in support of the application for a Certification
of Eligibility for Forbearance is true and accurate to the best of the
applicant's knowledge; and

���� (b)�� the applicant
understands and accepts that the department may, as part of its review process,
take necessary steps to verify the information submitted by the applicant, and
agrees to cooperate with the department in any such verification process; and

���� (4)�� any additional
documentation requested by the department.

���� d. (1) Within� 90 days from
the conclusion of the application submission period set forth in subsection a.
of this section, the department shall determine whether the application:

���� (a)�� is complete, and, if
not, the department shall provide written notice to the applicant explaining
why the application is incomplete.� An applicant who receives notice from the
department that their application is incomplete shall have 15 days after they receive
such notice to resubmit their application.� Upon the applicant's resubmission,
the 90-day review period shall begin from the original date of submission; and�

���� (b)�� meets the eligibility
criteria set forth in subsection b. of this section and, if so, issue a
Certification of Eligibility for Forbearance to the storm-impacted homeowner.

���� (2)�� If the department
determines that an application does not meet the eligibility criteria, the
department shall provide written notice to the applicant explaining why the
application does not meet the eligibility criteria and providing information on
the applicant's ability to appeal the department's decision.

���� (3)�� If the department fails
to act on an application that it has deemed to be complete before the
expiration of the 90-day review period pursuant to this subsection, the
applicant shall be deemed to have satisfied the eligibility criteria, and the
department shall issue a Certification of Eligibility for Forbearance to the
storm-impacted homeowner.

���� (4)� Upon their receipt of a
Certification of Eligibility for Forbearance, the storm-impacted homeowner
shall notify and provide a copy of the Certification of Eligibility for
Forbearance to the mortgage servicer identified in their application.

���� e.���� The forbearance period
shall conclude
[
one
year
]

two
years
after the date on which the department issues a Certification of
Eligibility for Forbearance to a storm-impacted homeowner unless the
storm-impacted homeowner discontinues the mortgage forbearance pursuant to
subparagraph (a) of paragraph (3) of subsection f. of this section or the
mortgage forbearance is terminated by the commissioner pursuant to subparagraph
(b) of paragraph (3) of subsection f. of this section.

���� f. (1) Notwithstanding the
provisions of any law, rule, or regulation to the contrary, the repayment
period of any mortgage subject to the forbearance pursuant to the issuance of a
Certification of Eligibility for Forbearance shall be extended by the number of
months the forbearance is in effect.� The payments not made during the
forbearance shall be due on a monthly basis during the period constituting an
extension of the mortgage unless the storm-impacted homeowner granted a
Certification of Eligibility for Forbearance has chosen to make these payments
earlier.�

���� (2)�� During the time of the
forbearance, and during the period constituting an extension of the mortgage,
all terms and conditions of the original mortgage, except with regard to
default and delinquency during forbearance, shall continue without modification
and there shall be no fees assessed, including attorney's fees, related to the
forbearance or late payment or penalty for early repayment.� A mortgage
forbearance pursuant to this section shall not be construed to impact a
homeowner's property tax or insurance obligations related to the property that
is the subject of the forbearance.� A homeowner who receives a Certification of
Eligibility for Forbearance shall be responsible for maintenance of the
property that is the subject of the forbearance during the period of
forbearance.�

���� (3) (a) A storm-impacted
homeowner who receives a Certification of Eligibility for Forbearance shall
have the option to discontinue the mortgage forbearance at any time at the
election of the storm-impacted homeowner upon written notice to the mortgage servicer
and to the department stating that they knowingly waive any rights they would
otherwise be afforded hereunder.

���� (b) The commissioner may
terminate a Certification of Eligibility for Forbearance and the
mortgage-forbearance period if the commissioner determines that the
storm-impacted homeowner made a false or misleading statement,
misrepresentation, or omission of a material fact in any application or
submission of information to the department pursuant to P.L.2024, c.85
(C.52:15D-15 et seq.).� Upon the termination of a Certification of Eligibility
for Forbearance or mortgage-forbearance period pursuant to this subparagraph,
the commissioner shall provide notice to the storm-impacted homeowner of their
right to a hearing to contest the termination in accordance with the
requirements of the "Administrative Procedure Act," P.L.1968, c.410
(C.52:14B-1 et seq.).�

���� (4)�� During any period of
mortgage forbearance granted pursuant to this section, a mortgage servicer
shall not, for the purposes of foreclosure of a residential property that is
the subject of a Certification of Eligibility for Forbearance issued pursuant
to this section that is not vacant, abandoned or otherwise subject to P.L.2003,
c.210 (C.55:19-78 et al.):

���� (a)�� send a storm-impacted
homeowner a notice of intention to foreclose pursuant to section 4 of P.L.1995,
c.244 (C.2A:50-56); or

���� (b)�� otherwise initiate the
foreclosure process.�

���� A deadline or time period for
action by a party to the foreclosure process for a residential property that is
subject to a Certification of Eligibility for Forbearance issued pursuant to
this section and filed prior to the effective date of P.L.2024, c.85
(C.52:15D-15 et seq.) shall be tolled until the end of the period of the
mortgage forbearance.

���� g.��� A storm-impacted
homeowner who has received a Certification of Eligibility for Forbearance and
is denied a forbearance by a mortgage servicer licensed by the Department of
Banking and Insurance may file a complaint with the Department of Banking and
Insurance.� The Department of Banking and Insurance shall investigate the
complaint and, if appropriate, shall order the mortgage servicer to grant a
forbearance to the storm-impacted homeowner pursuant to this section.

���� h. (1) To the extent required
by the Administrative Director of the Courts, the mortgage servicer shall
provide the docket numbers, party names, and property addresses as to any
pending court actions involving any property granted a forbearance to the Superior
Court Clerk's Office.

���� (2)�� The mortgage servicer
shall submit information on all forbearances that the mortgage servicer has
provided within the State to the Department of Banking and Insurance on a
monthly basis, or on any alternative schedule directed by the Department of
Banking and Insurance, after removing all personally identifiable information.�
This information shall be submitted in accordance with any specifications
required by the Department of Banking and Insurance, and, to the extent
required by the Department of Banking and Insurance, shall be deemed to be
government records and subject to the provisions of P.L.1963, c.73 (C.47:1A-1
et seq.), commonly known as the Open Public Records Act.

���� i.���� This section shall not
apply to any mortgage loans made, insured, or securitized by the Federal
National Mortgage Association, the Federal Home Loan Mortgage Corporation, the
Federal Housing Administration of the United States Department of Housing and Urban
Development, the Department of Veterans Affairs, or the Rural Housing Service
nor shall this section apply to any mortgage loans serviced pursuant to the
policies of these entities but not made, insured, or securitized by the
entities unless the mortgage loan has been granted a forbearance pursuant to
this section prior to being serviced by these entities.

���� j.���� It shall be an unlawful
discrimination in violation of the "New Jersey Law Against
Discrimination," P.L.1945, c.169 (C.10:5-1 et seq.) for a mortgage
servicer to discriminate in application of the provisions of this section on
any basis protected by subsection g. of section 11 of P.L.1945, c.169
(C.10:5-12).

(cf: P.L.2024, c.85, s.2)

���� 2.� Section 3 of P.L.2024,
c.85 (C.52:15D-17) is amended to read as follows:

���� 3.��� A storm-impacted
homeowner who is the subject of a foreclosure proceeding shall be awarded, by
the court and upon application by the property owner for good cause shown, a
stay in the foreclosure proceedings.� An application to the court by a
storm-impacted homeowner pursuant to this section shall be made prior to the
first day of the sixth month next following the effective date of P.L.2024,
c.85 (C.52:15D-15 et seq.), unless the courts in their discretion permit
application submission for a longer period.� The receipt of a Certification of
Eligibility for Forbearance, issued to the storm-impacted homeowner pursuant to
section 2 of P.L.2024, c.85 (C.52:15D-16), shall constitute good cause for the
award of a stay pursuant to this subsection.� The award of a stay pursuant to
this section shall conclude upon the earlier of:

���� a.���� the conclusion of
[
one year
]

two years

following the initial award of a stay of foreclosure proceedings; or

���� b.��� January 1,
[
2026
]

2027
.

(cf: P.L.2024, c.85, s.3)

���� 3. This act shall take effect
immediately and shall be retroactive to January 1, 2026.

STATEMENT

���� This bill extends foreclosure
protections for certain homeowners impacted by remnants of Hurricane Ida.

���� Under current law,
storm-impacted homeowners issued a Certification of Eligibility for Forbearance
entitle the applicant to receive a one-year mortgage forbearance from their
mortgage servicer.� Further, a storm-impacted homeowner who is the subject of a
foreclosure proceeding is awarded, by the court and upon application by the
property owner for good cause shown, a stay in the foreclosure proceedings.�
This bill would extend the one-year forbearance to a two-year forbearance and
provides that the award of a stay would conclude upon the earlier of: the
conclusion of two years, rather than one year, following the initial award of a
stay of foreclosure proceedings; or January 1, 2027, rather than January 1,
2026.�

���� The bill would take effect
immediately and be retroactive to January 1, 2026.