New Jersey Administrative Code › Title 3 - BANKING › Chapter 18 - FORECLOSURE CONSULTANTS › Subchapter 1 - GENERAL PROVISIONS › Section 3:18-1.2 - Definitions

Current through Register Vol. 56, No. 14, July 15, 2024
The following words and terms, when used in this chapter,
				  shall have the following meanings, unless the context clearly indicates
				  otherwise:
"Act" means the Foreclosure Rescue Fraud Prevention Act,
				  46:10B-53 et seq.
"Business entity" means a corporation, association, joint
				  venture, partnership, limited liability company, limited liability partnership,
				  sole proprietorship, or any other legal entity, however organized, permitted
				  under the laws of this State.
"Business licensee" means a business entity licensed as a
				  foreclosure consultant.
"Conventional mortgage rate" means the highest mortgage rate
				  published for the relevant loan product on the website of any generally
				  accepted industry provider of such information, applicable to the week
				  preceding the transaction.
"Distressed property" means residential real property
				  consisting of from one to four dwelling units, at least one of which is
				  occupied by the owner as a primary residence, and which is the subject of a
				  mortgage foreclosure proceeding or whose owner is more than 90 days delinquent
				  on any loan that is secured by the property.
"Distressed property conditional conveyance" means a
				  transaction involving any participation by, or any distressed property service
				  or other service or other assistance provided by, a foreclosure consultant, in
				  which a distressed property owner transfers an interest in fee, or a beneficial
				  interest created through a trust document, in the distressed property; the
				  acquirer of the property allows the distressed property owner to occupy the
				  property; and the acquirer of the property or a person acting in participation
				  with the acquirer of the property conveys or promises to convey an interest in
				  fee back to the owner or gives the owner an option to purchase the property at
				  a later date.
"Distressed property conveyance" means a transaction
				  involving any participation by, or any distressed property service or other
				  service or other assistance provided by, a foreclosure consultant, in which a
				  distressed property owner transfers an interest in fee in a distressed
				  property.
"Distressed property owner" means the owner of record of the
				  title to a distressed property.
"Distressed property owner's current verified monthly income"
				  means the monthly average of the owner's most recent six months of wage
				  receipts or pay stubs or, if the owner has non-wage income, by a verified
				  statement of profit and loss or income from a certified public accountant who
				  has reviewed the owner's income.
"Distressed property purchaser" means a person who acquires
				  an interest in a distressed property through a distressed property conditional
				  conveyance or a distressed property conveyance, or a person who participates in
				  a joint venture or joint enterprise involving a distressed property conditional
				  conveyance or a distressed property conveyance. The term "distressed property
				  purchaser" does not mean a Federally insured financial institution or a person
				  who acquires distressed property through a deed in lieu of foreclosure or a
				  person acting in participation with any person who acquires distressed property
				  through a deed in lieu of foreclosure, provided that person does not promise to
				  convey an interest in fee back to the distressed property owner or does not
				  give the owner an option to purchase the property at a later date.
"Distressed property relief" or "relief" means, in connection
				  with a foreclosure consultant, any of the following:
1. Saving the distressed property owner's
				property from foreclosure;
2.
				Postponing the foreclosure sale;
3.
				Obtaining a forbearance from the mortgagee;
4. Securing the right to exercise the right
				to reinstatement;
5. Obtaining an
				extension of the period within which the distressed property owner may
				reinstate his or her mortgage obligation;
6. Obtaining a waiver of an acceleration
				clause;
7. Obtaining a modification
				of a mortgage;
8. Assisting the
				distressed property owner in obtaining a loan or advance of funds; or
9. Avoiding the impairment of the distressed
				property owner's credit.
"Distressed property service" or "service" means, without
				  limitation, in connection with a distressed property conditional conveyance or
				  a distressed property conveyance, any of the following:
1. Debt, budget, or financial counseling of
				any type;
2. Receiving money for
				the purpose of distributing it to creditors in payment or partial payment of
				any obligation secured by a mortgage or other lien on a distressed
				property;
3. Contacting creditors
				on behalf of a distressed property owner;
4. Arranging or attempting to arrange for an
				extension of the period within which the distressed property owner may cure the
				owner's default and reinstate a debt obligation;
5. Arranging or attempting to arrange for a
				delay or postponement of the time of sale of the distressed property;
6. Advising with respect to the filing of any
				document or assisting in any manner in the preparation of any document for
				filing with any court;
7. Giving
				advice, explanation, or instruction to a distressed property owner that in any
				manner relates to the cure of a default or forfeiture or to the postponement or
				avoidance of a sale of the distressed property; or
8. Recording the foreclosure consultant
				contract as required by
				46:10B-56.g.
"Foreclosure consultant" means any person, located
				  out-of-State or within the State, who, directly or indirectly, for compensation
				  from a distressed property owner, makes any solicitation, representation, or
				  offer to perform, or who performs, any distressed property service that the
				  person represents will in any manner do any of the following in relation to the
				  owner's distressed property:
1.
				Prevent or postpone the foreclosure sale of the property;
2. Obtain any forbearance from any
				mortgagee;
3. Assist the distressed
				property owner in exercising any right of reinstatement or right of
				redemption;
4. Obtain any extension
				of the period within which the distressed property owner may reinstate the
				distressed property owner's rights with respect to the property;
5. Obtain any waiver of an acceleration
				clause contained in any promissory note, contract, or mortgage evidencing or
				securing a debt in relation to the property;
6. Assist the distressed property owner in
				obtaining a loan or advance of funds other than to pay off the promissory note,
				contract, or mortgage evidencing or securing a debt in relation to the
				property, except that, for the purposes of this paragraph 6, a foreclosure
				consultant shall not assist a distressed property owner by:
i. Providing any service that would require
				licensure under the Residential Mortgage Lending Act,
				17:11C-51 et seq., without first
				obtaining such license;
ii.
				Providing any service that would require licensure under the Consumer Finance
				Licensing Act,
				17:11C-1 et seq., without first
				obtaining such license; or
iii.
				Providing any such service that would require licensure, registration, or other
				credential under any other law or regulations of this State, another State or
				the United States, without first obtaining the requisite authorization;
				or
7. Avoid or
				ameliorate the impairment of the distressed property owner's credit resulting
				from default on the promissory note, contract, or mortgage, or the conduct of a
				foreclosure sale or offer to repair the distressed property owner's credit.
"Foreclosure consultant agreement" or "foreclosure consultant
				  contract" means the written document memorializing the terms of the contractual
				  agreement between a foreclosure consultant and a distressed property
				  owner.
"Individual" means a natural person.
"Individual licensee" means a natural person licensed as a
				  foreclosure consultant employed by a business licensee.
"Licensee" means a business licensee or an individual who is
				  licensed under the Act.
"Reasonable ability to pay" means that the distressed
				  property owner's current verified monthly income is adequate to service a
				  30-year fixed rate loan at the conventional mortgage rate together with actual
				  property taxes, homeowner's insurance, condominium or association fees, if
				  applicable, and reasonable and necessary living expenses.
"Reasonable and necessary living expenses" means not less
				  than the average utility costs over the last 12 months, or if that figure is
				  unavailable, $ 200.00, and transportation, food, clothing, and other expenses
				  equal to an amount not less than the Collection Financial Standards set forth
				  by the Internal Revenue Service for transportation, food, clothing, and other
				  items and out-of-pocket health care costs.
"Residual income" means a distressed property owner's net
				  income available to meet living expenses after the payment of all ordinary and
				  necessary debt, including payments under an option to purchase back the
				  distressed property owner's property transferred in a distressed property
				  conditional conveyance.