SENATE, No. 665







Sponsored by:


District 33 (Hudson)


District 31 (Hudson)






     Requires owner of foreclosed property to provide relocation assistance to tenant displaced by termination of illegal occupancy.



     Introduced Pending Technical Review by Legislative Counsel


An Act concerning relocation assistance for termination of illegal occupancy and amending P.L.1993, c.342.


     Be It Enacted by the Senate and General Assembly of the State of New Jersey:


     1.    Section 4 of P.L.1993, c.342 (C.2A:18-61h) is amended to read as follows:

     4.    a.  If a residential tenant is displaced because of an illegal occupancy in a residential rental premises pursuant to paragraph (3) of subsection g. of section 2 of P.L.1974, c.49 (C.2A:18-61.1) and the municipality in which the rental premises is located has not enacted an ordinance pursuant to section 3 of P.L.1993, c.342 (C.2A:18-61.1g), the displaced residential tenant shall be entitled to reimbursement for relocation expenses from the owner in an amount equal to six times the monthly rental paid by the displaced person.

     b.    Payment by the owner shall be due five days prior to the removal of the displaced tenant.  If payment is not made within this time, interest shall accrue and be due to the displaced residential tenant on the unpaid balance at the rate of 18% per annum until the amount due and all interest accumulated thereon shall be paid in full.

     c.     If reimbursement for which an owner is liable is not paid in full within 30 days of removal of the tenant, the unpaid balance thereof and all interest accruing thereon and, in addition thereto, an amount equal to six times the monthly rental paid by the displaced tenant shall be a lien upon the parcel of property on which the dwelling of the displaced residential tenant was located, for the benefit of that tenant.  To perfect the lien, a statement showing the amount and due date of the unpaid balance and identifying the parcel shall be recorded with the county clerk or registrar of deeds and mortgages of the county in which the affected property is located, and upon recording, the lien shall have the priority of a mortgage lien. Identification of the parcel by reference to its designation on the tax map of the municipality shall be sufficient for purposes of recording.  Whenever the unpaid balance and all interest accrued thereon has been fully paid, the displaced residential tenant shall promptly withdraw or cancel the statement, in writing, at the place of recording.

     d.    This section shall not authorize the enforcement of a lien for actual reasonable moving expenses with respect to any real property the title to which has been acquired by a municipality and which has been transferred pursuant to a rehabilitation agreement.

     e.     For the purposes of this section, the owner of a structure
shall [exclude] include owners or mortgagees [in possession of a structure through] who have obtained a judgment of foreclosure for the premises.

(cf: P.L.1993, c.342, s.4)


     2.    This act shall take effect immediately.





     This bill would require that an individual or entity which takes possession of a residential property through foreclosure to provide any tenant in the property with relocation assistance equal to six months of rental payments if the tenant is being removed as the result of an illegal occupancy.  Current law exempts property owners who take possession to a property through foreclosure from paying relocation assistance to a tenant who must vacate a property due to an illegal tenancy.

     The sharp increase in residential foreclosures during the Great Recession has resulted in the inequitable occurrence of residential tenants being forced to vacate their home when a landlord loses the home to foreclosure and a new owner takes over management of the premises.  Current law requires a new owner to honor the terms of an existing residential lease on the property.  This bill would impose on a new owner the same obligation to the tenant as would be imposed on the original landlord if the tenant is forced to leave the property as the result of an illegal tenancy.