NJ Appeals Court Invalidates Notice of Intent to Foreclose
The New Jersey Fair Foreclosure Act (FFA) requires lenders to provide written notice to borrowers prior to accelerating the debt or commencing a foreclosure action. The New Jersey Appellate Division recently held the notice requires identification of the “lender” – meaning either the entity that makes, holds or is assigned the mortgage.
The Court found that identification of the loan servicer was not sufficient and held the notice of intent to foreclose was invalid, requiring dismissal of the foreclosure complaint without prejudice.
To comply with the FFA, the notice of acceleration/intent to foreclose needs to identify the lender by name and its address and the telephone number of the lender’s representative, which may, but need not, be the servicer. The Court noted that if Mortgage Electronic Registration Systems, Inc. (MERS) had assigned the mortgage to the servicer prior to sending the notice of intent to foreclose, the notice would have complied with the FFA because the servicer would fit within the meaning of “lender” as assignee of the mortgage.
Bank of New York as Trustee v. Laks, 2011 N.J. Super. LEXIS 153 (N.J. App. Div)