New Jersey Foreclosure Prevention
The thought of losing your home is enough to cause anyone stress. Along with losing your home, you can also receive a deficiency judgment for the difference between the sale price of the home and the balance you owe. If you are a New Jersey homeowner concerned about a potential foreclosure, it is important to act immediately to save your home. The state and government offer a variety of aid to prevent foreclosure.
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Counseling
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Counselors offer guidance and support to homeowners. HUD-approved foreclosure prevention specialists are trained to thoroughly explain the foreclosure process and address your options and rights as a homeowner. Certain programs are offered exclusively to New Jersey residents, such as the Homekeeper Program. The counselor can discuss the program and qualification requirements to apply for assistance. If you need help communicating with your lender, the counselor can advocate on your behalf. The HUD website allows you to search for New Jersey housing counselors in your area (see Resources).
Making Home Affordable
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The Making Home Affordable Program provides relief to homeowners across the state. If you are fewer than 30 days behind on the loan, the refinance program lowers the interest rate to reduce the monthly payment. Homeowners who would otherwise not qualify to refinance due a decline in the value of their homes may be eligible to refinance through the program. Unlike the bank, the program does not require your home to appraise at the purchase price. For homeowners who have already missed payments, the loan modification reduces the interest rate or extends the length of the loan. Homeowners who are approved for the program are placed on a trial modification plan to ensure their ability to pay the adjusted mortgage payment.
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Mediation
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The New Jersey mediation program offers homeowners the opportunity to meet with lenders to reach a solution. Homeowners also have access to housing counselors and legal aid through the program. A neutral party mediates the session and suggests possible work-out and payment arrangements to satisfy the outstanding debt. To request mediation, respond to the foreclosure complaint from the lender. It is important to respond to all notices you receive from the court within the specified amount of time. Failure to respond can lead the judge to ruling a final judgment without a hearing.
New Jersey Homekeeper Program
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New Jersey was declared one of the states hit the hardest in the foreclosure crisis. The U.S. Department of Treasury implemented the Hardest Hit Fund to bring additional assistance to homeowners in these states. The New Jersey Housing Finance Agency developed the New Jersey Homekeeper Program to keep unemployed homeowners, or those suffering a hardship, from losing their homes. The Homekeeper Program provides homeowners an interest-free, deferred payment loan capped at $48,000 to cover the mortgage for a period of up to 24 months. Within the two-year period, the homeowner is expected to seek employment and restore his income to at least 85 percent of previous earnings. The loan can also be applied to a delinquent mortgage balance.
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