Authorizes HMFA to make certain reimbursements to support pre-purchase homebuyer counseling under Foreclosure Mediation Assistance Program.

S4331

SENATE, No. 4331

STATE OF NEW JERSEY

222nd LEGISLATURE

�

INTRODUCED MAY 28, 2026

Sponsored by:

Senator� TROY SINGLETON

District 7 (Burlington)

Senator� BENJIE E. WIMBERLY

District 35 (Bergen and Passaic)

Co-Sponsored by:

Senators Turner, McKnight and Timberlake

SYNOPSIS

���� Authorizes HMFA to make certain reimbursements to
support pre-purchase homebuyer counseling under Foreclosure Mediation
Assistance Program.

CURRENT VERSION OF TEXT

���� As introduced.

��

An Act

authorizing certain reimbursements to support
pre-purchase homebuyer counseling and amending P.L.2021, c.373
.

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

���� 1.��� Section 1 of P.L.2021,
c.373 (C.2A:50-81) is amended to read as follows:

���� 1.��� The Legislature finds
and declares that:

���� a.���� The Foreclosure
Mediation Assistance Program administered by the New Jersey Housing and
Mortgage Finance Agency provides trained foreclosure prevention and default
mitigation counselors for homeowner-borrowers participating in the Foreclosure
Mediation Program established by the New Jersey Judiciary.

���� b.��� As provided by section 7
of the "New Jersey Foreclosure Mediation Act," P.L.2019, c.64
(C.2A:50-80), trained foreclosure prevention and default mitigation counselors
are paid using a portion of funds paid by a foreclosure plaintiff in an action
for foreclosure.

���� c.���� During the public
health emergency declared by the Governor in Executive Order No. 103 of 2020
due to the coronavirus disease 2019 (COVID-19) pandemic, the New Jersey Housing
and Mortgage Finance Agency expanded its Foreclosure Mediation Assistance Program
to provide other supports to New Jersey residents including renter and
pre-foreclosure counseling.

���� d.��� Since the expansion
began,
[
nearly
5,000
]

thousands of
households have been served.

���� e.���� Sufficient funding
exists for trained foreclosure prevention and default mitigation counselors to
continue to provide pre-foreclosure counseling services
[
although the
public health emergency declared by the Governor in Executive Order No. 103 of
2020 has concluded
]

and pre-purchase homebuyer counseling
.

���� f.���� In the event of a
declaration of a state of emergency, persons who have been trained to provide
foreclosure counseling services under the Foreclosure Mediation Assistance
Program are well positioned to help disaster victims prepare and submit
applications for State and federal disaster assistance.

����
g.��� Pre-purchase housing
counseling reduces the incidence of foreclosure among homebuyers and,
therefore, may be used as an early intervention to prevent the occurrence of
mortgage delinquency, mortgage default, and foreclosure. �Professionals
providing foreclosure counseling services under the Foreclosure Mediation
Assistance Program possess the expertise required to also offer pre-purchase
counseling and education to homebuyers, making such proactive foreclosure
prevention services a natural extension of the Foreclosure Mediation Assistance
Program.

(cf: P.L.2023, c.123, s.1)

���� 2.��� Section 2 of P.L.2021,
c.373 (C.2A:50-82) is amended to read as follows:

���� 2.��� a.�������� There is
established in the General Fund a separate, non-lapsing, dedicated account
administered by the Department of Community Affairs to be known as the
"New Jersey Foreclosure Counseling Fund."

���� b.��� The funds within the New
Jersey Foreclosure Counseling Fund shall be paid to the New Jersey Housing and
Mortgage Finance Agency no later than the 15th day of each quarter to reimburse
trained foreclosure prevention and default mitigation counselors for costs
expended thereby in:

���� (1) providing pre-foreclosure
counseling services in accordance with guidance established by the New Jersey
Housing and Mortgage Finance Agency and for the agency's services required
under P.L.2019, c.64 (C.2A:50-74 et seq.);
[
and
]

���� (2) providing, to homeowners
and renters who have been impacted by real property damage to, or destruction
on, their primary residence, as a result of an event that prompted the Governor
or the President of the United States to declare a state of emergency or issue
an emergency disaster declaration, assistance in the preparation and submission
of applications for housing related expenses, including, but not limited to:
(a) rental payments; (b) mortgage payments; (c) insurance payments; (d)
property tax payments; and (e) repair, rehabilitation, or relocation assistance
payments that have been made available, by the State or federal government, in
response to the declared emergency or disaster
; and

����
(3)�� providing
pre-purchase homebuyer counseling services in accordance with guidelines
established by the New Jersey Housing and Mortgage Finance Agency
.

���� c.���� The New Jersey Housing
and Mortgage Finance Agency may assess up to five percent of New Jersey
Foreclosure Counseling Fund's annual allocation amounts for administrative
costs.

���� d.��� For purposes of this
section, "trained foreclosure prevention and default mitigation
counselors" shall have the same definition as in section 2 of the
"New Jersey Foreclosure Mediation Act," P.L.2019, c.64 (C.2A:50-75).

(cf: P.L.2023, c.123, s.2)

���� 3.��� This act shall take
effect immediately.

STATEMENT

���� This bill authorizes the New
Jersey Housing and Mortgage Finance Agency (HMFA) to provide certain
reimbursements to support pre-purchase homebuyer counseling, by expanding the
existing Foreclosure Mediation Assistance Program (program) to include early
intervention prepurchase homebuyer counseling services.

���� Under current law, the program
provides reimbursement to certain qualified counselors who assist homeowners by
either: (1) providing mediation assistance through HUD certified housing
counselors to qualified applicants of the New Jersey Judiciary�s Foreclosure
Mediation Program, or (2) providing pre-foreclosure counseling assistance, to
homeowners experiencing default or difficulty meeting their monthly mortgage
payments.� The program operates through a network of participating housing
counseling agencies serving in each county.

���� The bill authorizes HMFA to
also provide reimbursements to qualified counselors to support pre-purchase
homebuyer counseling.� The provision of pre-purchase housing counseling helps
to reduce the incidence of foreclosure among homebuyers and serves as an early
intervention to prevent the occurrence of mortgage delinquency, mortgage
default, and foreclosure.