The national economy is improving but New Jersey still leads the country in foreclosure actions. In 2017, there were just over 70,000 properties in stages of the foreclosure process throughout New Jersey according to a report issued by the real estate data firm, ATTOM Data Solutions. While the number of properties in foreclosure was down nearly 4,000 from 2016 levels, New Jersey is still very high in comparison to the rest of the country which experienced some of the lowest numbers of foreclosure actions since the financial crisis started in 2006.
There are a few reasons for New Jersey having the highest number of properties in foreclosure. For example, New Jersey has very stringent consumer protection laws which are designed to protect mortgage borrowers. Another reason is that New Jersey is a judicial foreclosure state which means that lenders have to bring their borrowers to court in order to foreclose and seize the property as collateral for loan. This has led to a very lengthy and expensive court process, which has averaged more than 3 years in New Jersey, for a bank to complete the foreclosure process in court. Bergen County and Hudson County have the longest delays with over 1,400 days on average to complete the process.
According to Jose Santiago, Broker of Record for Joseph James Real Estate, this means that there is still money to be made in short sales, real estate owned properties (REO’s) and distressed properties for real estate agents in North Jersey. While many agents and brokers have turned their attention elsewhere, Jose Santiago continues to close short sale transactions.
A quick search on Trulia.com reveals 470 properties as of this writing on April 26, 2018 with the keyword “short sale” in North Jersey. This result includes 186 listings in Bergen County, 55 listings in Hudson County and 229 listings in Essex County. A similar search with the keyword “bank owned” returns 477 listings in Essex County, 432 listings in Bergen County and 275 results in Hudson County. Some agents have used these keywords in their listings with descriptions such as “This property is NOT a short sale” or “this is NOT bank owned”. With that in mind, the savvy agent does have to sift through the results. Nevertheless, it is clear that there are alot of properties in distress that need buyers and that can translate to profit for smart agents.
There is a significant difference in buying a bank owned property as opposed to purchasing a short sale property. Both types of transactions require an agent and a broker with experience in both listing and purchasing distressed properties. A bank owned property, also referred to as real estate owned or REO, has already been foreclosed upon. The bank is the owner and there is no longer a homeowner in the picture. This means that the sale is often much faster than a short sale. Bank are very savvy and they intend to recover the expenses of foreclosing on the properties so while there may be a slight discount from a traditional homeowner listing, there will not be the deep discount that a buyer might find with a short sale.
Joseph James Real Estate is a leading broker of distressed properties in North Jersey. Located in Kearny, NJ this new agency was designed for professional real estate agents. Real estate agents love working for Joseph James and love the 95/5 commission split. Happy agents mean happy clients. Everybody wins. Are you a real estate agent in North Jersey ready for a new start?
Learn more about being a Joseph James Agent