Foreclosures Could See New Life [AUDIO]

The New Jersey Residential Foreclosure Transformation Act was approved this week by the Assembly Appropriations Committee, aimed at reviving the stagnant economy and increasing home ownership.

Under the bill, foreclosed residential properties could be purchased in order to produce affordable housing, and dedicate it as such for 30 years. Affordable housing supports low-to-moderate income individuals and families.

"We need to address the shortage in affordable housing. We need to address the excess of foreclosures. This bill does both," said Assembly Democrat Albert Coutinho, a bill sponsor.

Sponsors of the measure said more than 100,000 New Jersey homeowners are dealing with foreclosures.

"Our economy is intrinsically linked to a healthy housing market," said Assemblyman John Wisniewski (D). "Now, four years into the recession, there are many homes that have sat idle for quite a while and deteriorated, making it even harder to reclaim them. We need to pursue creative solutions such as this to reinvigorate our economy and our neighborhoods."

Assemblyman Coutinho said the projects would be completed using municipalities' affordable housing trust fund monies, as well as foreclosure settlement funds from the federal government.

Coutinho continued, "Foreclosed and abandoned homes drag down property values, and they create unstable communities."

He said the housing market would get a boost as abandoned homes are taken off the market.

Opponents of the measure have described it as "Trenton's dangerous and destructive foreclosure scheme." Americans for Prosperity said language in the bill opens the door for affordable housing units to be housed by ex-offenders and individuals who are homeless.

"This bill empowers the State to become a major factor influencing the stability and value of residential housing. By moving into every neighborhood, the neighborhood's future economic stability will hinge on the success or failure of this uneconomic interference in the marketplace," said Americans for Prosperity State Director Steve Lonegan.

The Act awaits consideration by the full Assembly.