At a New Jersey sheriff’s sale, your foreclosed property is publicly auctioned at the county courthouse after four weeks of published advertising, with bidding starting at the court-set upset price (minimum bid). The highest bidder wins the property, and if no third-party bids meet the upset price, the foreclosing lender takes ownership. Understanding this process is essential for homeowners who want to explore options to prevent or delay the sale.
Pre-Sale: Advertising and Notice Requirements
Before a sheriff’s sale can occur in NJ, the property must be advertised in a newspaper of general circulation in the county where the property is located. The advertisement must run once per week for four consecutive weeks preceding the sale date. The notice must include the property address, a legal description of the property, the approximate amount of the judgment, the date, time, and location of the sale, and the upset price. The homeowner should also receive direct notice of the scheduled sale. Failure to comply with these advertising requirements can be grounds to challenge the sale.
The Upset Price
The upset price is the minimum acceptable bid at the sheriff’s sale. It is established by a court order (the writ of execution) and typically includes the outstanding mortgage balance, accrued interest through the sale date, the lender’s attorney fees and costs as awarded by the court, property taxes and insurance advances, and sheriff’s fees and sale costs. The upset price is often close to or exceeding the full judgment amount. Third-party buyers should be aware that the upset price may exceed the property’s current market value, particularly in cases involving high-interest loans or lengthy foreclosure proceedings.
The Bidding Process
Sheriff’s sales in NJ are conducted at the county sheriff’s office, typically on a designated day each week or month (the schedule varies by county). The sale is a public auction open to any qualified bidder. Bidding starts at the upset price and proceeds upward. Bidders typically must have a deposit available (usually 20% of the bid amount) in the form of a certified check or cashier’s check. The highest bidder at the close of bidding wins the property.
What Happens If No One Bids
In many NJ sheriff’s sales, no third-party buyers bid on the property because the upset price exceeds the market value or because the property’s condition deters bidders. When this happens, the foreclosing lender is deemed to have purchased the property for the upset price amount. The property then becomes bank-owned, also known as Real Estate Owned (REO). The lender’s purchase satisfies the judgment, and any remaining deficiency between the judgment amount and the property’s value may or may not be pursued against the borrower depending on the circumstances and applicable law.
After the Sale: Deed Delivery
After the sheriff’s sale is completed, the sheriff prepares and delivers a sheriff’s deed to the successful purchaser. This typically occurs approximately 10 days after the sale. The deed transfers legal title to the property. The new owner then records the deed with the county clerk’s office to complete the transfer. Until the deed is delivered, the former homeowner retains the right of redemption (the right to reclaim the property by paying the full judgment amount).
Eviction After Sheriff’s Sale
The new owner of the property cannot simply change the locks or remove the former homeowner’s belongings. In New Jersey, the new owner must go through a formal legal eviction process. This requires filing a summary dispossess (eviction) action in the Special Civil Part of the Superior Court, serving the occupants with notice, and obtaining a judgment for possession and a warrant of removal. The entire process typically takes several weeks to a few months after the deed is delivered and recorded. Former homeowners have the right to contest the eviction and cannot be removed without a court order.
Call Friscia & Associates Today
If a sheriff’s sale is scheduled on your NJ property, you may still have options to prevent or delay the sale. Call Friscia & Associates at (973) 500-8024 to speak with a NJ foreclosure defense attorney who can evaluate your situation and take action to protect your home.
Legal Disclaimer: The information on this page is for general informational purposes only and does not constitute legal advice. No attorney-client relationship is formed by reading this content. Every foreclosure case is different, and outcomes depend on the specific facts and circumstances involved. If you need legal advice, please contact our office to schedule a consultation.