Last December, state supreme court justice Stuart Rabner called a halt to foreclosures by some of the biggest banks in the country in the state of New Jersey, demanding that Bank of America, Wells Fargo, JPMorgan Chase and other major lenders cease and desist all foreclosures in the state until they had proven that they had dealt with potential consumer abuse in their systems and could be confident that their foreclosure processes were fair and just. Now, according to the judge in charge of reviewing the case, they have done so, and tens of thousands of New Jersey residents are wondering where this will lead in the coming months once the banks resume foreclosures.
While this definitely leaves many citizens on tenterhooks, it also leaves residents of New Jersey particularly vulnerable to the notorious “foreclosure rescue” scheme. While many companies offer legitimate loan modification aid and other types of foreclosure alternative services, the field is rife with con artists and scammers who are quick to take advantage of homeowners desperate for a solution that keeps them in their home. In an effort to deal with this issue, the New Jersey legislature recently passed the Foreclosure Rescue Fraud Prevention Act designed to compel fraudulent foreclosure rescue companies to compensate people who have lost their homes and savings by trusting them. Phyllis Salowe-Kaye, executive director of New Jersey Citizen Action, a homeowner advocacy group, explains that “[New Jersey] is going to be inundated with new cases [of foreclosures] and the bad guys will take advantage of that – they’re going over the lists right now of the people named in foreclosure filings.”
The New Jersey legislature and advocacy groups like Salowe-Kaye’s are urging governor Chris Christie to sign the bill quickly. His office will only say that the bill is being reviewed. Four years ago the bill was passed by the assembly but ultimately failed to make it into law and it appears that some of the concerns over it at that time may not have been addressed .
There are many laws governing foreclosure fraud and foreclosure rescue fraud on the books at many levels already. Do you think that this specific bill is as important as Christie’s detractor’s claim? And also at issue, what do you think this new foreclosure tsunami means for the New Jersey economy and real estate market?
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