Bill > S1825

Introduced Session

This bill establishes the "New Jersey Rent-to-Own Rights Protection Act" for the purpose of protecting tenant-buyers in residential rent-to-own agreements. The bill defines a "rent-to-own agreement" as a lease agreement for residential real property, between a landlord-buyer and tenant-seller, that includes an option or obligation to purchase the property through installments throughout the lease term or at a later date. The bill requires a rent-to-own agreement to be in writing, to be signed by the landlord-seller and tenant-buyer, and to contain a statement of all terms, including:· the total purchase price of the property;· the duration of the lease term before purchase;· the amount of the option fee and whether it is refundable;· the portion of rent payments, if any, credited toward the purchase price;· the party responsible for property taxes, insurance, maintenance, and utility payments;· the conditions under which the tenant-buyer may forfeit the right to purchase; · the rights of the heirs of the tenant-buyer in the event of the tenant-buyer's death or incapacity; and· any other information that the Commissioner of Community Affairs (commissioner) determines necessary to effectuate the purposes of the bill, and that is in the public interest. The bill provides a tenant-buyer with a right to obtain an independent property inspection before signing a rent-to-own agreement and, if the agreement provides an option to purchase at a later date, prior to the tenant-buyer exercising that option. The landlord-seller is also to provide the tenant-buyer with:· a signed property condition disclosure statement, as provided for in section 1 of P.L.1999, c.76 (C.56:8-19.1);· a full accounting of how payments will be applied toward ownership;· a notice of any existing liens or legal claims on the property;· proof of the receipt of a certificate of occupancy for the property, obtained no more than six months prior to entrance into the agreement; and · any other information that the commissioner determines necessary to effectuate the purposes of the bill, and that is in the public interest. The bill provides that a tenant-buyer is not to be required to forfeit payments made toward the purchase price unless the tenant-buyer has defaulted on the agreement after reasonable notice of at least 30 days and an opportunity to cure the default. The bill provides a tenant-buyer with a right to record a rent-to-own agreement with the county recording office, and permits the county recording officer to charge a fee for the recording not to exceed the greater of $1 per page or the actual costs to complete the recording. The bill prohibits a landlord-seller from engaging in certain fraudulent or deceptive conduct, which materially relates to the condition of a property, the terms of the rent-to-own agreement, or the ability, as permitted by the agreement, for the tenant-buyer to obtain financing towards the purchase of the property. The bill prohibits a rent-to-own agreement from containing any waiver of the tenant-buyer's rights as established by the bill, or any other applicable law. Further, the bill prohibits a property owner from entering a rent-to-own agreement if the property is in default on mortgage or property tax payment obligations. The bill prohibits the rights of a tenant-buyer in a rent-to-own agreement from being impaired by the sale of a property by a landlord-seller to a third party, or other form of disposition of the property from the landlord seller. The bill prohibits a landlord-seller from entering a rent-to-own agreement without a homeowner's insurance policy. If compensation is owed to the property owner as a result of eminent domain or an insurance payment, the payment is to be divided between the landlord-seller and tenant-buyer, unless used to reconstruct damage to the property for the tenant-buyer's continued use. The percentage of the value of the property that is represented by the equitable interest, as defined in the bill, is to be paid directly to the tenant-buyer. The bill also prohibits a rent-to-own agreement from impairing the implied warranty of habitability. A violation of the provisions of the bill is to constitute an unlawful practice under the New Jersey consumer fraud act (CFA), and subject to all applicable penalties set forth in the CFA. The bill permits a tenant-buyer who has been harmed by a violation of the bill to initiate a civil action for actual damages, statutory damages of $10,000, attorneys' fees, costs for expert witnesses, other costs incurred in proving a violation of the bill, and injunctive relief. The bill also provides the Director of the Division of Consumer Affairs in the Department of Law and Public Safety (director) with enforcement authority to investigate violations and impose penalties. The bill provides the Commissioner of Community Affairs with authority, in consultation with the director, to adopt rules and regulations to effectuate the provisions of the bill. The bill is to take effect on the first day of the fourth month following enactment.

AI Summary

Committee Categories

Angela Mcknight (D)*,  Troy Singleton (D)*, 

Introduced in the Senate, Referred to Senate Community and Urban Affairs Committee (on 01/13/2026)

Official Document