New Jersey has the dubious distinction of being home to 17,000 “zombie” foreclosures as of the second quarter of 2015, the greatest number of any state, according to a report by housing-data website RealtyTrac. A “zombie” occurs when a home is foreclosed on and the occupants move out, but the foreclosure is abandoned or never completed by the bank, leaving the empty home still legally in the owner’s possession. This often happens in low-income areas, where lenders do not want to assume responsibility for the property and take on the taxes and upkeep.
These foreclosures cause numerous problems. For example, homes often end up in a state of disrepair because no one is maintaining them, which lowers property values. The owners can also find themselves liable for taxes and other charges on a property they do not even know they still legally own.
The number of “zombies” in New Jersey has climbed 40 percent since the second quarter of 2014. Nationally they were down 10 percent over the same period. One reason for New Jersey’s high “zombie” rate is that the state has the country’s longest foreclosure timeline: Nolo.com reports that New Jersey’s timeline lasts 1,103 days — more than three years.
There were 70,000 foreclosures in state in the second quarter of this year, out of 527,047 countrywide.