Office of Legislative Services
State House Annex
P.O. Box 068
Trenton, New Jersey 08625
Legislative Budget and Finance Office
Phone (609) 847-3105
Fax (609) 777-2442
www.njleg.state.nj.us
LEGISLATIVE FISCAL ESTIMATE
[First Reprint]
ASSEMBLY, No. 2294
STATE OF NEW JERSEY
221st LEGISLATURE
DATED: APRIL 16, 2024
SUMMARY
Synopsis: Establishes mortgage payment relief and foreclosure protection for
certain homeowners impacted by the remnants of Hurricane Ida.
Type of Impact: Time-limited delay in State revenue collections; time-limited State
expenditure increase.
Agencies Affected: Housing and Mortgage Finance Agency; State entities holding
mortgage loans; Department of Law and Public Safety; the Judiciary;
Department of Banking and Insurance.
Fiscal Impact FY 2024 – FY 2026
Potential State Revenue Shift Indeterminate
Potential State Expenditure Increase Indeterminate
The Office of Legislative Services (OLS) anticipates that the one-year mortgage forbearance
granted to certain homeowners under the bill will result in a time-limited delay in State revenue
collections made by the Housing and Mortgage Finance Agency and any other State entities
holding mortgage loans.
The OLS cannot determine the number of homeowners with mortgages through State agencies
who will request and be eligible for the mortgage forbearance, for how many months they will
suspend payment, or the amount of the mortgage payments typically owed. Therefore, the
timing and amount of the delayed revenues are indeterminate.
The OLS determines that there may be a State expenditure increase as result of the bill
authorizing the Attorney General to bring an action against a mortgage servicer alleged to have
furnished negative information to a debt collector or credit reporting agency. These violations
may result in a State revenue increase associated with fines collected pursuant to the bill.
The OLS finds there may also be a State expenditure increase associated with the bill’s
requirement that the Department of Banking and Insurance investigate certain complaints made
by storm-impacted homeowners who were denied a forbearance. FE to A2294 [1R]
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BILL DESCRIPTION
This bill would require mortgage servicers to grant a mortgage forbearance to certain storm-
impacted homeowners. This mortgage forbearance suspends the obligations for mortgage
principal and interest payments. A storm-impacted homeowner is the mortgagor of title of a
residential property which they occupied as their primary residence as of August 31, 2021 and
obtained federal disaster assistance for disaster-related needs as a result of Hurricane Ida. A
mortgage servicer is required to grant a mortgage forbearance if the storm-impacted homeowner
submits a written request to the mortgage servicer, prior to the first day of the sixth month next
following enactment of the bill, affirming that: (1) the storm-impacted homeowner suffered a
negative financial impact as a result of damage to their primary residence due to the remnant of
Hurricane Ida, and obtained federal disaster assistance as a result; (2) the gross household income
of the storm-impacted homeowner, in 2022, did not exceed 150 percent of the most recent area
median income by zip code, unless this requirement is waived by the mortgage lender; and (3) if
the storm-impacted homeowner possesses one or more bank accounts, those bank accounts
collectively contain less than six months’ reserves of the storm-impacted homeowner’s gross
household income for 2021. Mortgage servicers would be required to grant one year of mortgage
forbearance to eligible storm-affected homeowners. During the period of forbearance, mortgage
servicers would be prohibited from initiating the foreclosure process.
Mortgage servicers would be prohibited from furnishing negative mortgage payment
information to a debt collector or credit reporting agency related to the mortgage payments subject
to the forbearance. The bill would also permit the Attorney General to, on their own initiative or
in response to a complaint, bring an action alleging a mortgage servicer has violated this
prohibition, with a penalty including a fine of up to $5,000 per violation. A storm-impacted
homeowner denied a forbearance by a mortgage servicer licensed by the Department of Banking
and Insurance may file a complaint with that department.
The repayment period of a mortgage granted forbearance would be extended by the number of
months the forbearance was in effect, constituting an extension of the mortgage, unless the
property owner chooses to make the payments earlier.
Mortgage loans made, insured, or securitized by the following entities, or serviced pursuant to
the policies of these entities, would not be subject to the mortgage forbearance requirements: the
Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation, the
Federal Housing Administration of the United States Department of Housing and Urban
Development, the Department of Veterans Affairs, and the Rural Housing Service.
A storm-impacted homeowner who is the subject of a foreclosure proceeding shall be awarded,
by the court and upon application by the property owner, a stay in the foreclosure proceedings if
the conditions for a mortgage forbearance are satisfied and the homeowner applies to the court
before the first day of the sixth month next following the effective date of the bill. The court may
extend the application deadline. The award of stay shall conclude one year following the initial
award of a stay of foreclosure proceedings or January 1, 2026, whichever is earlier.
The bill would take effect immediately and apply retroactively to mortgage payments missed
subsequent to September 1, 2021.
FISCAL ANALYSIS
EXECUTIVE BRANCH
None received. FE to A2294 [1R]
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OFFICE OF LEGISLATIVE SERVICES
The OLS anticipates that the one-year mortgage forbearance granted to certain homeowners
under the bill will result in a time-limited delay in State revenue collections made by the Housing
and Mortgage Finance Agency and any other State entities holding mortgage loans.
The OLS cannot determine the number of homeowners with mortgages through State agencies
who will request and be eligible for the mortgage forbearance, for how many months they will
suspend payment, or the amount of the mortgage payments typically owed. Therefore, the timing
and amount of the delayed revenues are indeterminate.
The OLS determines that there may be a State expenditure increase as result of the bill
authorizing the Attorney General to bring an action against a mortgage servicer alleged to have
furnished negative information to a debt collector or credit reporting agency. These violations
may result in a State revenue increase associated with fines collected pursuant to the bill.
The OLS finds there may also be a State expenditure increase associated with the bill’s
requirement that the Department of Banking and Insurance investigate certain complaints made by
storm-impacted homeowners who were denied a forbearance.
Section: Local Government
Analyst: Grace Ahlin
Assistant Fiscal Analyst
Approved: Thomas Koenig
Legislative Budget and Finance Officer
This legislative fiscal estimate has been produced by the Office of Legislative Services due to the
failure of the Executive Branch to respond to our request for a fiscal note.
This fiscal estimate has been prepared pursuant to P.L.1980, c.67 (C.52:13B-6 et seq.).