Foreclosures Ease A Bit In NJ, But Remain Higher Than National Rate

The Record ( — February 19, 2016

Staff Writer
The Record

Housing distress is easing in New Jersey, but the state still has much higher rates of foreclosures and mortgage delinquencies than the nation as a whole, the Mortgage Bankers Association said Thursday.

About 12.1 percent of New Jersey mortgages — or one in eight — were either late on payments or in foreclosure in the fourth quarter of 2015. That's down from 14.8 percent a year earlier, but is almost twice the national rate of about 6.5 percent, the lowest level since before the recession.

"As the job market has improved and national home prices have rebounded, fewer borrowers were becoming seriously delinquent, while borrowers previously behind on their payments were in a better position to ... resolve delinquent loans," Marina Walsh, MBA's vice president of industry analysis, said in a statement.

New Jersey led the nation in the number of foreclosures started in the fourth quarter, according to the MBA. It was 12th in the rate of mortgages with late payments.

New Jersey has been slower than the nation as a whole in dealing with the fallout from the housing crisis. In the Garden State, as in about half the states, foreclosures go through the courts, which tends to slow the process. In addition, New Jersey courts placed a near-freeze on foreclosure activity in late 2010, as the mortgage industry faced accusations of violating borrowers' rights in a rush to evict. The industry has been catching up on those distressed properties in the last several years.

In 2015, according to the state Judiciary, lenders filed 35,733 residential foreclosures. That was down from 48,795 in 2014, but up dramatically from fewer than 6,000 in 2011.

"We're seeing that banks are moving forward to do foreclosures, and there are more people who are being displaced," said Phyllis Salowe-Kaye, head of N.J. Citizen Action in Newark, the state's largest housing counseling agency.

In states that depend on the energy industry, which has been hit by lower oil prices, foreclosure starts rose during the fourth quarter, the MBA said. Oklahoma, North Dakota, Louisiana, Colorado and Texas all had increases in new foreclosures.

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