Foreclosures remain high in New Jersey

Most of the country recently experienced a reprieve from the foreclosure epidemic plaguing the nation - unfortunately New Jersey was not included in this reprieve.

While the nation as a whole enjoyed a 17 percent drop in the number of homes foreclosed upon - when compared to last year - New Jersey suffered an increase of more than one percent in foreclosed homes, according to a monthly report from CoreLogic.

In addition, the same report shows that New Jersey ranks second in the nation in the percentage of homes in foreclosure - 7.7 percent in the process of defaulting, compared to the national average of only 3.2 percent.

Adding insult to injury was another report by RealtyTrac that discovered roughly 2,600 New Jersey homeowners were given initial foreclosure filings in November - which is a sixfold increase from the same period a year earlier.

According to RealtyTrac, Essex County alone accounted for 262 of these filings, with Bergen County attributing 179 filings and Passaic 170. By contrast, during the same month last year, these New Jersey areas only had 25, 30 and 35 initial foreclosure filings, respectively.

Many experts believe the recent increase in foreclosure activity is the result of banks' efforts to process the backlog of home mortgages currently in default - a backlog created when banks were required by the state Supreme Court in 2010 to review their document signing practices utilized in the foreclosure process. Consequently, the number of New Jersey foreclosure filings dropped from 58,000 in 2010 to only 6,000 by July 2011, according to the Star-Ledger. Now, banks are trying to make up for the lost time, and lost revenue.

Bankruptcy: An option for New Jersey homeowners facing foreclosure

Now that the foreclosure floodgates have opened, there is little doubt that banks will continue filing New Jersey foreclosures at breakneck pace - meaning foreclosures will continue to afflict beleaguered homeowners.

It is important for New Jersey homeowners to know they have other forms of relief available when refinancing options and loan modification programs fail; specifically relief in the form of bankruptcy. When a New Jersey homeowner facing foreclosure files for bankruptcy, all foreclosure actions against them are stopped.

In addition, homeowners wishing to save their home can utilize Chapter 13 bankruptcy in order to set up a repayment plan and get current on the home payments.

Ultimately, every situation is unique, and what may be best in your circumstances may be different than someone else. Accordingly, it is often best to speak with an experienced foreclosure defense and bankruptcy attorney to learn what options may be best given your distinctive situation.