Unlike some states that allow for either a judicial or non-judicial foreclosure, New Jersey relies entirely upon the judicial process. A judicial foreclosure means that the lender initiates a foreclosure by filing a lawsuit in the local court of jurisdiction. It takes about nine months from the initial filing to the final public auction to complete a foreclosure in New Jersey, according to RealtyTrac. Cases can vary depending on how much patience the lender has with a delinquent borrower before beginning the foreclosure; if the homeowner decides to contest the action, this could also affect how long it takes.
The period that begins with an official court filing and ends with the property auction is called pre-foreclosure. It begins with the lender notifying the borrower of the intention to file foreclosure papers. This notice must happen at least 30 days before actual filing. Legally, the lender could give notice immediately upon the borrower missing a payment, but most lenders don't seriously begin considering foreclosure until two or three payments are in arrears. During this 30-day period, the borrower can stop the intended foreclosure by making up the past due amount.
If the borrower doesn't make up the mortgage deficiency within the initial 30-day waiting period, the lender may begin the actual foreclosure by recording a notice of pending lawsuit with the county clerk. As soon as the borrower is notified of this second step, he has an additional 35 days to respond to the complaint. Lacking a response, the court will normally rule against him and a date will be set to auction off the property. If the borrower does have a legitimate response, a trial could lengthen the overall time of the foreclosure.
Notice of Sale
Even without a response from the homeowner, New Jersey has one of the longest wait times for foreclosure in the nation. After the default judgment is entered, another 45 days must pass before the next step, the notice of sale, can go forward. Information regarding the intent to auction the property must be posted on the land itself, in the local court office and published in two local newspapers. Notice must also be sent to the property owner at least 10 days before the sale.
As long as the borrower has been given the mandatory 10-day notice of sale, the auction can commence according to plans. The sale takes place on the county courthouse steps. The highest bidder becomes the new owner, though he has 24 hours to make final payment. This completes the foreclosure.