What is a loss mitigation affidavit?
A sworn statement filed by a mortgage servicer in court confirming that it completed a required review of the borrower's loss mitigation options before a foreclosure judgment can be entered.
A loss mitigation affidavit is a sworn court document submitted by a mortgage servicer or lender in foreclosure proceedings. In it, the servicer certifies under oath that it reviewed the borrower's application for loss mitigation relief, such as loan modification, forbearance, or short sale options, before a foreclosure judgment is entered.
This affidavit is required in many New Jersey foreclosure cases as part of the state's pre-judgment review process. The servicer must attest that the borrower was provided an opportunity to submit financial information and that a meaningful review of available loss mitigation remedies actually occurred. If the affidavit is missing or defective, a court may delay or deny entry of a foreclosure judgment.
The requirement exists to protect borrowers from proceeding directly to foreclosure without exploring alternatives that might allow them to keep their home or avoid a full judicial sale. For borrowers in the Trenton metro area facing foreclosure, the existence and sufficiency of this affidavit can affect whether a case moves forward as scheduled.
Foreclosure attorneys representing borrowers routinely challenge these affidavits when the servicer has not genuinely reviewed loss mitigation options or when the affidavit contains false certifications. Servicer counsel must ensure the affidavit is accurate and properly executed to withstand judicial scrutiny. Borrowers seeking to delay or prevent foreclosure or to arrange loan modifications should confirm that any loss mitigation affidavit filed by their servicer complies with New Jersey requirements.