Reverse Mortgage Monthly Payments Subject to Judgment Execution Creditors' Attachment, NJ Appeals Court Says
In a decision published on March 8, 2012 involving a novel issue in New Jersey debtor/creditors' rights laws, a New Jersey appellate panel held that a mortgage company's obligation to make monthly payments to a homeowner pursuant to a reverse mortgage is subject to attachment by a creditor holding a judgment against the homeowner. Cameron v. Ewing , Superior Court of New Jersey, Appellate Division, Docket No. A-3628-10T2. The trial court determined that the monthly stream of reverse mortgage payments were beyond the reach of judgment creditors, and thus denied the creditor's motion to compel the mortgage company to turnover the payments as part of the creditor's attempt to collect its judgment via garnishment on the mortgage company. The judgment creditor appealed, and the Appellate Division reversed having concluded that the mortgagee's obligation to make monthly payments to the defendant judgment debtor is properly construed to be a "debt" ...