In New Jersey, lenders that elect to accelerate a mortgagor’s default prior to maturity of the mortgage can breathe a collective sigh of relief as a result of a recent decision rendered by a New Jersey court. In the decision, Bergen County Superior Court Judge, the Honorable Edward A. Jerejian, upheld the longstanding triggers for commencement of a statute of limitations for residential foreclosure actions, finding that the filing of a foreclosure complaint, which was later dismissed, did not cause the statute of limitations to commence running.

In Deutsche Bank National Trust Co. v. Hochmeyer, 2017 N.J. Super. Unpub. LEXIS 102 (Ch. Div. Jan. 18, 2017), the borrower/defendant’s default occurred on Dec. 1, 2006. Plaintiff commenced a foreclosure action in 2007, which was dismissed. A new action was filed in 2016. The borrower/defendant argued that the initial filing of the foreclosure complaint in 2007, which accelerated the loan, also accelerated the maturity date, thereby triggering the application of the six-year statute of limitations provided for in N.J.S.A. 2A:50-56.1. Because plaintiff did not recommence the foreclosure prior to 2013—six years after the 2007 acceleration—defendant contended that the action was barred by the applicable statute of limitations. The court rejected defendant’s argument, finding that the six-year statute of limitations specifically refers to the date of the last payment required by and/or the maturity date set forth in the mortgage.

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