Search Icon
The Not So Short “Short Sale”: New Legislation in New Jersey Helps Expedite the Short Sale Process Banner Image

Banking, Title Insurance, and Real Estate Litigation Blog

The Not So Short “Short Sale”: New Legislation in New Jersey Helps Expedite the Short Sale Process

August 15, 2017
The New Jersey Legislature recently amended New Jersey’s Fair Foreclosure Act to require loan servicers on residential mortgages to engage in consultations on short sales with prospective buyers, and to respond to short sale offers from buyers within certain periods. See A2060. Under the bill, which will take effect on September 19, 2017, a mortgage loan servicer is required to respond to a good faith offer from a seller, seller’s agent, or authorized third party to purchase the property through a short sale within 60 days of the date of the offer. A response would include an approval, a denial, or a request for further information. If the servicer does not approve a short sale or does not respond to the offer within 60 days, any deposit made by the potential buyer in connection with the purchase of the property will be refunded and the buyer will have no further obligation with respect to the property. The bill further amends the Fair Foreclosure Act to define “short sale” as “the sale of real property in which the lender or servicer agrees to release the lien that is secured by a residential mortgage on the property upon receipt of a lesser amount than is owed on the mortgage.” This amendment will not affect the servicer or debtor’s ability to participate in mediation or settlement regarding the mortgage at issue.

For a copy of this bill, please contact Michael O’Donnell at modonnell@riker.com, Clarissa Gomez at cgomez@riker.com or Sarah Heba at sheba@riker.com.
Read More

You May Also Be Interested In:

Analyzing the Fallout: Entire Controversy Doctrine Impacts Complex Mortgage Dispute
April 3, 2024
Financial Services

Introduction This case explores the impact of New Jersey’s entire controversy doctrine in a foreclosure action involving...

Learn More >

Bank of America and Zelle Establish Compliance with the EFTA
March 20, 2024
Financial Services

Introduction In a comprehensive decision, the United States District Court for the Central District of California recently...

Learn More >

Tenth Circuit Affirms ECOA’s Regulatory Decision to Limit Creditors’ Exposure
March 18, 2024
Financial Services

Introduction In a recent credit discrimination case, the Tenth Circuit affirmed the Western District of Oklahoma’s finding...

Learn More >

Get Our Latest Insights

Subscribe