In New Jersey, home buyers will sign two documents: a promissory note and a mortgage. The promissory note contains the terms and conditions of the loan and the mortgage provides the lender with a security interest in the property, allowing it to sell it at a foreclosure sale. If a borrower defaults on the loan, they must reinstate the mortgage or face foreclosure.
The lender must send the homeowner a Notice of Intent to Foreclose, which is sent via certified mail at least 30 days before the foreclosure lawsuit. The notice must detail the default and the amount needed to cure it. If the homeowner subsequently cures the default, the lender must take payment. The lender cannot collect attorney’s fees at this stage. Generally, a homeowner has up to 180 days to resolve the default.
The lender will serve the defendant with the summons and complaint, and will have 35 days to file an answer. This answer will admit or deny the allegations in the complaint or state the reason that the plaintiff does not have a valid case. The answer is reviewed by the Office of Foreclosure, and the case can progress or be dismissed depending on its type. The defendant can ask for mediation, but it will not stop the foreclosure.