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August 09, 2015

New Jersey starts HomeSaver program to help families in foreclosure

Program will offers zero interest loans to families suffering from financial hardship

During last Thursday's Republican primary debate, one of the first challenges directed at New Jersey Governor Chris Christie was his state's crippling foreclosure rate, which has consitently ranked within the bottom 10 states over the past several years. 

In the first half of 2014, there were 23,500 new foreclosures filed in New Jersey, compared to 20,253 for the entire year of 2005 before the housing market began to enter freefall, according to NJ Spotlight.

To help families facing foreclosure due to severe negative equity, mortgage rate increases and financial hardship, the state is launching a new program backed by $17 million in federal aid to provide no-interest loans up to $50,000, NewsWorks reports.

The HomeSaver Program is expected to offer relief to about 350 homeowners who are at risk of foreclosure in New Jersey and who meet qualifications based on financial hardship, such as recent unemployment or reduced income.

According to The Trentonian, homeowners do not necessarily have to be delinquent on their mortgage payments in order to qualify for assistance. Applicants must contact their mortgage servicer directly to determine whether they are participating in the program, which is financed through a grant from the U.S. Treasury's Hardest Hit Fund.

"There are a lot of people who have been struggling to keep their home current and not making perhaps repairs that need to be made or not making other investments in their housing choices," said Staci Berger, president and CEO of the Housing and Community Development Network of New Jersey, in an interview with Newsworks. "So this is a chance for them to get ahead and not fall behind. We think it's a great first step."

In addition to the zero percent interest rate, the 10-year loans are forgivable and without monthly payments. After the fifth year of the loan's closing date, it will be forgiven at 20 percent per year and forgiven in full after the tenth year.

To learn more about the program, visit