Skip to main content



The Bank of New York Mellon v. Elghossain

F-13402-10 (N.J. Super. Ch. Div. 2011)

FORECLOSURE; MORTGAGES; FAIR FORECLOSURE ACT — Under the Fair Foreclosure Act, a Notice of Intention to foreclose must be sent to a homeowner and that notice must, without exception, include the name and address of the actual lender and the telephone number of a representative contact, and if there is a servicer, the borrower needs to be informed of both the lender and servicer’s identities.

The assignee of a mortgage filed a foreclosure complaint against the mortgagors because the mortgagors had failed to make the installment payments. Once the loan went into default, the assignee sent two notices of intention to foreclosure (NOI). The mortgagors disputed the propriety of the NOI under the New Jersey Fair Foreclosure Act (FFA), alleging that the lender and the lender’s representation were not identified in the NOI. The FFA requires strict compliance.

The FFA clearly, unambiguously, and readily comprehensibly requires identification of the foreclosing lender in the NOI to foreclose. The FFA specifically requires that the NOI be sent to the defaulting borrower by certified mail and also that the NOI be sent by the residential mortgage lender. Additionally, it provides that the NOI must include the name and address of the lender and the telephone number of its representative. Therefore, if there is a servicer, the borrower must be informed of both the lender and servicer’s identities.

In an Appellate Division case, EMC Mortgage Corp. v. Chaudri, 400 N.J. Super. 126, 137 (App. Div. 2008), the Court held that a lender’s substantial compliance with the contents of a NOI, sent by a lender prior to initiation of foreclosure, pursuant to N.J.S.A. 2A:50-56(c) was a material requirement. Furthermore, a borrower cannot waive the rights afforded under the FFA because a waiver would violate the public policy. Lastly, the Court has emphasized that lenders need to faithfully comply with the FFA provisions and that the notice provisions are mandatory.

In this case, the assignee contended that failing to identify the lender was not a significant omission in the foreclosure complaint because the servicer’s name and contact was listed on the NOI. However, the Court ruled that the FFA requires that the NOI be sent to the defaulting borrower by certified mail and that the NOI be sent by the residential mortgage lender. Here, the letter came from the servicer and not from the lender. Secondly, the FFA requires that the NOI must include the name and address of the lender and the telephone number of a representative to contact. Therefore, if there is a servicer, the borrower needs to be informed of both the lender and servicer’s identities.

The assignees argued that they should be allowed to re-serve the NOI. However, the Court ruled that re-serving the NOI would satisfy the meaning of the statute. Therefore, the foreclosure complaint was dismissed without prejudice.


MEISLIK & MEISLIK
66 Park Street • Montclair, New Jersey 07042
tel: 973-783-3000 • fax: 973-744-5757 • info@meislik.com