N.J. Stat. Ann. § 55:17-1 et seq. § 55:17-2
Records by holder of mortgage loan
Operative Text
In the event of any default or foreclosure in respect to a project coming within this act, the holder of the mortgage loan shall establish a set of records, separate and distinct from those pertaining to its usual business or operations, to reflect with reasonable accuracy the appropriate debits and credits applicable to the project, from which all necessary and proper calculations can be made to continue to carry out the terms and provisions of the lease or financial arrangement, or both, as directed by this act. Such records shall be established and maintained in accordance with recognized accounting practices, to be certified to by independent certified public accountants, in order to assure the governmental body or agency involved that the terms and conditions of the lease or financial arrangement will continue to be applied according to their intent. L.1967, c. 304, s. 2, eff. Feb. 15, 1968.
Under N.J.S.A. 55:17-2, when a mortgage-backed housing project covered by this act enters default or foreclosure, the mortgage holder is required to create and maintain a separate set of financial records dedicated solely to that project. These records must be kept according to recognized accounting standards and certified by independent CPAs. The purpose is to ensure that the lease or financial arrangement governing the project can continue to be honored according to its original terms, giving the relevant government body confidence that residents' arrangements remain intact.
Plain English — not legal advice.
As a mortgage holder on a project subject to N.J.S.A. 55:17-2, compliant operators generally establish a dedicated accounting ledger for the affected project at the onset of default or foreclosure proceedings, keeping it entirely separate from general business records. Those records are typically maintained under standard accounting practices and submitted for certification by an independent CPA. Doing so demonstrates to the involved governmental body or agency that the lease or financial arrangement will continue to be administered as originally intended.
General guidance for property managers — not legal advice for your specific situation. Consult an attorney for advice on your case.
N.J.S.A. 55:17-2 is designed to protect the continuity of lease and financial arrangements for residents of projects that fall into default or foreclosure by requiring the mortgage holder to maintain verified, separate records. If you live in such a project and believe your lease terms are not being honored during a foreclosure or default situation, you may have grounds to raise this provision when engaging with the relevant governmental body or agency overseeing the project. Tenant-rights organizations in New Jersey can help you understand what records you may be entitled to reference and what avenues exist for raising concerns.
General guidance for tenants — not legal advice for your specific situation. Consult a tenant-rights organization or attorney for advice on your case.
Generated October 14, 2026 — auto-generated, not yet human-reviewed. See /transparency for methodology.
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