New Jersey Bankers Consider Mortgage Assignment Process Reform

On February 6, 2012, the Residential Lending and Loan Servicing Committee (the "Committee") of the New Jersey Bankers Association forwarded to the Committee's members a draft of a report on mortgage assignments in New Jersey (the "Draft Report"). The Committee asked the members to advise the Committee as to any comments or concerns that they may have about the Draft Report. Several financial services attorneys in the Reed Smith Princeton office are active committee members. Overall, the Draft Report appears to be an attempt to modernize the process of recording New Jersey mortgage assignments.

The Draft Report begins by describing how the mortgage recording system in New Jersey was traditionally intended to operate, with every assignment of a mortgage loan being recorded in the appropriate county recorder's office promptly following its execution. (We note, however, that the law did not require assignees of mortgages to record their assignments. The law