A Foreclosure will usually involve a sheriff sale and perhaps a short sale as well. Title Insurance is critical. As we discussed in the Buying Selling Basics page, Title Insurance will allow you to purchase a property at a Sheriff Sale with full knowledge of what is owed on it.
Many people go into a Sheriff Sale from a forclosure and find out - after they have won the Bid at the Auction Sale - that it has a huge tax bill, utility or HOA Assoc bill still owed.
NJ law is very lenient on the defaulting homeowner. The paperwork process can take literally 24 months before a Foreclosure is finally authorized and the property is actually auctioned off by the County Sheriff. Each County within NJ has their own procedures to auction a piece of property.
These Counties are in our SNJ Real Estate Market area:
Select the county of your choice and it will be a direct link to that particular County Sheriff Website.
A very popular website (Realtytrac) will have all types of foreclosures listed on their websites.
Save yourself a lot of legwork and grief - ask your Realtor what is actually available. In NJ when a Homeowner becomes more than 90 days late on their mortgage payment, their bank will fill a Lis Pendens notice in a central state clearing house to put on notice that a homeowner is delinquent on their mortgage and a suit is pending.
This Lis Pendens filing starts a deluge of paperwork by specialized collection attorneys hired by Mortgage companies, against the homeowner. Their fees can add up to thousands of dollars very quickly - making it even more difficult for the homeowner to "catch up" on their mortgage!
The filing of the Lis Pendens is what triggers a "listing" in Realtytrac. History has shown time and time again that many of these never become an actual auction sale. A Buyer is chasing a house that may never come up on the market.
If a house actually does go to foreclosure, the county sheriff will have NO INFORMATION about the house - is it occupied, damaged, etc. The winning bidder at the auction must be very aware of this. If it is occupied, the new winning bidder must then utilize the Sheriff again to attempt to evict the occupants. If they are legal tenants, they will have very explicit NJ Tenant Rights that must be adhered to before attempting any eviction upon them!