What is the Community Wealth Preservation Program

June 10, 2026

The Community Wealth Preservation Program (CWPP) was signed into law by Gov. Murphy on January 12, 2024. The goal of this legislation is to protect homeowners and their loved ones facing residential foreclosure. The law provides additional time to homeowners, next of kin, tenants, and “other prospective owner-occupants” to buy back the property with special financing opportunities. The intent of the law is to give homeowners and their loved ones the opportunity to retain their investment, even after a property has entered the foreclosure process. Here, we take a closer look at the CWPP and what this law can mean for families facing foreclosure.


The Law


The CWPP is actually an amendment to section N.J.S.A. 2A:50-64 of the 1995 NJ Fair Foreclosure Act (FFA). This amendment was created to make it easier for folks with ties to a property to protect their claim even during foreclosure. The amendment also gives creditors who are legally responsible for the maintenance and security of a property the right to enter the property for the purposes of upkeep if the property becomes abandoned. The law also states that anyone bidding on the property may not enter it before the sheriff’s sale.


The goal is to prevent the loss of generational wealth, especially in Black, Brown, and BIPOC communities that are heavily impacted by foreclosures. The law also combats private equity firms and corporations from buying distressed properties, instead empowering ordinary people to maintain or acquire a residence.


Key Elements


There are a few key elements of the law that aim to create a standardized, fair application of the legislation:


First Right of Refusal


Under typical foreclosure law, the homeowner has what is called the “first right of refusal.” The first right of refusal gives the homeowner the opportunity to purchase their home at a sheriff’s sale before it is sold to a third party. The CWPP expands the pool of eligible right of refusal buyers to include next of kin, tenants, and specific nonprofit community development corporations. To exercise the right of first refusal, the homeowner or eligible buyer must pay the original upset price for the property.


The “upset price” is the minimum price at which the home can be sold at a sheriff’s sale. This price must be posted online at least four weeks before the sale.


To exercise the right of refusal, the individual must intend to use the property as their primary residence for at least 84 months after purchase. Using the home as a primary residence also allows the bidder to put down a smaller deposit of 3.5% of the upset price. The remainder of the upset price is due within 90 business days of purchase. If the bidder cannot pay the full upset price within 90 days of the sale, they must forfeit their deposit and pay any accrued interest. There is an exception if the failure to secure financing is not the bidder's fault but due to circumstances beyond their control.


Outside Bidders


It is crucial to note that if the bidder is not the foreclosed-upon defendant, their next of kin, a tenant, or a nonprofit, the deed will state that the property cannot be sold for 84 months after purchase. Additionally, they will face a fine of $100,000 for a first-time violation and $500,000 for any violation after. Exceptions will be made for buyers who acted in good faith and were forced to leave the property due to extenuating circumstances, such as divorce, military deployment, a change in employment, or medical issues.


Financing


Eligible bidders are allowed to finance the purchase of the foreclosed property at a sheriff’s sale if they can provide sufficient evidence of pre-approval for a loan. The loan must be through a financial institution regulated by the Department of Banking and Insurance.

If the bidder is using financing to secure the purchase of the home, they must be pre-approved for the listed upset price. They also cannot submit bids higher than the amount they have been preapproved for. The buyer will have up to 90 business days to close on the property—a significantly longer timeline than most traditional sales. This gives the buyer ample time to secure the financing needed to close.


Legal Challenges


While the law was originally enacted to boost equity among homeowners in the state, there have been several legal challenges to its constitutionality. In some counties, specific aspects of the law have been suspended.


A 2025 Mercer County court ruling declared the “right of refusal” for nonprofit community development corporations (NCDCs) unconstitutional. An NCDC is a nonprofit organization whose main purpose is community revitalization through the restoration of vacant or abandoned properties.


The goal of these organizations is to preserve affordable residential housing. After the Mercer County ruling, several other counties have either suspended or amended nonprofits' ability to participate in the CWPP. Those counties include:

  • Burlington County: Suspended the acceptance of any non-profit organizations from acquiring properties at sheriff's sales through the CWPP.
  • Cape May County: Deferred the acceptance of bids from NCDCs pending future legal updates.
  • Mercer, Morris, and Union Counties: Modified the requirements for NCDCs, allowing them to bid alongside the general public without the right of refusal.


How to Participate


If you are facing foreclosure or are seeking to purchase a foreclosed property through the CWPP, you must first register your intent to utilize the program through your local sheriff’s office. Your sheriff’s office will be able to provide the specific guidelines of the sale, the sale schedule, and any applicable registration links for the sale.


To register your intent to participate in the CWPP, you must submit all the required paperwork to the sheriff’s office at least three days prior to the sale. Common documents required for all bidders include:


  • Pre-registration form (available at your local sheriff’s office)
  • Two forms of valid identification, including one photo ID
  • Financing documents, like a pre-approval letter


If you are participating in the sale as a tenant, you must submit the following additional documentation:

  • A physical, notarized copy of a valid lease showing residency for at least a year
  • Proof that all rent payments are current
  • Proof of residency
  • Proof of enrollment in an 8-hour HUD-certified homebuyer education course
  • A signed occupancy affidavit declaring your intention to reside at the property for no less than 84 months


Non-profits have another set of documents they must provide:

  • IRS Determination Letter of tax-exempt status and a current 1023 form
  • A current NJ Certificate of Good Standing as a formation/incorporation
  • A signed mission statement


Working with an experienced NJ foreclosure attorney is an excellent way to ensure you are receiving the full protections of this program. An attorney will understand the key aspects of this relatively new legislation and help guide you through the statutory requirements. They will also handle all the paperwork and deposit requirements to ensure you are on track.


Veitengruber Law’s legal team is experienced in all things New Jersey real estate and foreclosure. We work with NJ homeowners and families to protect their equity, defend against foreclosure, and save their homes. Our real estate attorney has decades of experience successfully helping NJ homeowners stay in their homes. Since 2024, we’ve used the CWPP to help our clients maintain or acquire a residence. A home is not just a piece of property: it is the foundation for generational wealth. Let’s protect that wealth and keep it in your family.