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NJ governor enacts moratorium on eviction and foreclosure removals, calls on banks to work with loan holders

New Jersey Gov. Phil Murphy Thursday outlined a series of measures to help people in immediate financial need and keep people in their homes during the coronavirus crisis.

Murphy signed a bill into law that provides authority to the governor to issue an executive order declaring a moratorium on removing individuals from their homes through eviction or foreclosure proceeding. He then signed an executive order imposing the moratorium. The order comes a day after the U.S. Department of Housing and Urban Development, Fannie Mae, and Freddie Mac announced that they would be suspending all foreclosures and evictions for at least 60 days.

“This outbreak affects all of us and we are all in this together,” Murphy said. “The steps I am outlining today will help those who are suffering financial harm through no fault of their own continue to stay afloat as we work our way through this. They will also bolster public health by ensuring that residents facing eviction or foreclosure can stay in their homes, protecting them against an increased risk of contracting and spreading COVID-19.”

Murphy is also asking financial institutions that hold residential or commercial mortgages, equity loans, lines of credit or business loans, to implement a process to work with the mortgagors or loan holders to avoid foreclosure or default due to financial hardship caused by the COVID-19 pandemic, or by any local, state, or federal government response to COVID-19.

The New Jersey Economic Development Authority is coordinating efforts between the Small Businesses Administration and businesses in the state. The authority is currently setting up local technical assistance programs to help New Jersey businesses apply for SBA assistance.  More information about the SBA program is available via the state’s COVID-19 business portal: https://cv.business.nj.gov

For businesses with an immediate financial need, the U.S. Small Business Administration has approved the New Jersey governor’s request for a disaster designation, opening up access to the SBA’s economic injury disaster loan program for New Jersey businesses hit hard by the COVID-19 pandemic. The SBA’s economic injury disaster loans offer up to $2 million in assistance for small businesses and private non-profits. Loans can be used to pay fixed debts, payroll, accounts payable, and other bills that can’t be paid because of the disaster’s impact. The interest rate is up to 3.75% for small businesses without credit available elsewhere. The interest rate for non-profits is up to 2.75%. Loan terms are up to a maximum of 30 years. The SBA will determine an appropriate payment based on the financial condition of the borrower, which also will determine the loan term. Details regarding the SBA loan program can be found online at https://faq.business.nj.gov/en/articles/3789809 and  https://disasterloan.sba.gov/ela/.

The New Jersey Housing and Mortgage Finance Agency is expanding its foreclosure mediation assistance program to include renter and pre-foreclosure counseling using a network of housing counselors in each county. The counseling can be provided remotely, and is free of charge. Counselors will provide upfront assistance to help homeowners avoid potential foreclosure. Counseling made available to renters will guide them on how to approach discussions with their landlords on dealing with their rent situation. For a list of participating housing counselors, visit: https://njhousing.gov/foreclosure

At the Department of Community Affairs, rental assistance programs continue to operate and fulfill core business functions, including paying rents to landlords and processing recertifications, income redeterminations, and other core functions. Department of Community Affairs field offices are closed to the public to observe social distancing protocols. The agency is encouraging participants to use the online portal at assistancecheck.com to submit documents, or to submit documents through the mail. Current program participants can email or call the field offices or the customer service line at 609-292-4080 or email: customer.service@dca.nj.gov to leave messages with questions. Residents in need of emergency housing assistance should call 2-1-1.

Murphy also announced Thursday that the New Jersey Higher Education Student Assistance Authority will offer assistance to people who need help making regular payments on NJCLASS student loans due to a diminished income. People directly impacted by COVID-19 can apply for NJCLASS loan relief for temporary disability or unemployment. Applications for relief are available online at https://www.hesaa.org/Documents/Relief%20Options/Unemployment.pdf  and https://www.hesaa.org/Documents/NJCLASSTempDisabilityForm.pdf. NJCLASS borrowers can apply for financial hardship relief. To assist people financially impacted by COVID-19 mitigation measures who are not eligible to receive unemployment or temporary disability assistance, HESAA is requesting borrowers supplement their financial hardship application with a statement explaining how the impact of the COVID-19 virus response has caused their financial hardship. The NJCLASS loan application is available at https://www.hesaa.org/Documents/Relief%20Options/Financial%20hardship.pdf.