Bulletin: NJ2017004

Date:
September 11, 2017
To:
All New Jersey Issuing Offices
RE:
UNDERWRITING - Municipal liens affecting vacant properties during foreclosure

Dear Associates:

We have become aware of a new trend regarding municipal fees being assessed against vacant properties during foreclosure. On July 14, 2014, N.J.S.A. 46:10B-51 was amended to allow municipalities to enact local ordinances that impose penalties on mortgage lenders who fail to remedy municipal ordinance violations on vacant or abandoned property during a foreclosure action. In addition, the amended law allows municipalities to use public funds to abate a nuisance or correct a violation on residential property for which the lender was given notice. The municipality can place a lien on the property if these funds are not paid back. 

We have learned that several municipalities in New Jersey have either proposed or are considering proposing local ordinances in accordance with N.J.S.A 46:10B-51 to enforce penalties against lenders. Accordingly, if you are dealing with a property that has gone through foreclosure, you should contact the municipality to inquire about any vacant property fees. Some vendors are now including notes regarding vacant property fees as part of their tax search products. As mentioned above, any fees associated with public funds being used to resolve a violation can become a lien on the property and must be resolved.  

If you have any questions relating to this or other bulletins, please contact the New Jersey State Office for assistance.

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THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER  AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.

References

Bulletins Replaced:
None
Related Bulletins:
None
Underwriting Manual:
None
Exceptions Manual:
None
Forms:
None