Moriarty Bill to Exempt Foreclosing Creditors from Paying Property Registration Fee under Certain Circumstances
- jsaban8
- May 12
- 1 min read

The Senate Community and Urban Affairs Committee advanced legislation sponsored by Senator Paul Moriarty today that would exempt foreclosing creditors from the payment of an annual property registration fee imposed by a municipality under certain circumstances.
“It is unfairly burdensome to require creditors to pay fees when they can’t take any action at all to maintain or oversee a property,” said Senator Moriarty (D-Gloucester/Camden/Atlantic).
“Exempting creditors from paying these fees ensures that they are not being financially penalized when they have, in essence, lost their property rights. It’s a step in the right direction to ensure that both debtors and creditors are free of unnecessary burden under circumstances like these.”
Under current law, a municipality is authorized to require a foreclosing creditor to register the property and pay an annual fee. These registration fees are typically imposed to ensure that properties, especially those in foreclosure or vacant, are maintained appropriately to prevent blight and ensure public safety.
However, when a property owner files for bankruptcy under Chapter 7 or Chapter 13, an automatic stay is triggered under Section 362(a) of the federal Bankruptcy Code. During an automatic stay, creditors are legally restricted from taking any action against the debtor, including foreclosure proceedings, eviction efforts, or any attempt to enforce a lien or judgement.
As a result, creditors who hold a lien or interest in the property are essentially frozen in place, as they cannot maintain, access, or transfer the property without court permission. Regardless, they must pay property registration fees to the municipality.
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