On April 21, 2023, the New Jersey Appellate Division (“the Court”) issued an important and uniquely topical decision in the matter of NR Deed, LLC v. Rabago, No. A-2315-21, LEXIS 603 (App. Div. Apr. 21, 2023), providing some of the first recorded guidance on the types of evidentiary proofs that will be considered sufficient to demonstrate “fair market value” under the revised terms of N.J.S.A. 54:5-89.1, as well as direction regarding the extent to which internet property valuation websites like Zillow.com will be given consideration.


In 2011, Henry and Jennifer Rabago (“Defendants”) purchased a home in Sayreville, New Jersey (“the Property”). Over the ensuing years of ownership, Defendants became delinquent on their property taxes and utilities, leading to the Sayreville Tax Collector, in 2018, selling a tax sale certificate (“the Certificate”) to GSRAN-Z, LLC (“the Certificate Purchaser”) in exchange for its payment of Defendants’ unpaid balance. Thereafter, the Certificate Purchaser continued paying all taxes and utilities owed on the Property, causing the balance of the Property’s tax lien to swell to over $60,000 by August 2021, at which time the Certificate Purchaser filed a foreclosure action against Defendants. In early December 2021, the Certificate Purchaser moved for the entry of final judgment in the foreclosure action and assigned its interests in the Certificate to Plaintiff NR Deed, LLC (“NR”).

On December 19, 2021, Defendants contracted to sell the Property to MAO Properties, LLC (“MAO”), with the sale contract providing that Defendants would be permitted to continue residing at the Property for six months post-closing and that MAO would pay Defendants’ litigation and closing expenses. MAO then moved to intervene in the foreclosure action and redeem the Certificate, with both MAO and Defendants submitting certifications to the foreclosure court in support of the application. Therein, they attested that the $150,000 price paid for the Property constituted fair market value because the Property was dilapidated and in need of substantial repair, and that the deal provided Defendants with the best opportunity for receiving maximum value for the Property and afforded them an opportunity to satisfy their debts and start over anew. NR opposed and contended that the price paid was not fair market value, relying on a Zillow.com “Zestimate” valuing the Property at nearly $400,000.

The foreclosure ruling

The foreclosure court heard oral argument on the dispute, with NR acknowledging during the proceedings that its price estimate was not a formal appraisal and was based only on the “outside” of the Property, as interior access was never granted. The foreclosure court ultimately ruled in MAO’s favor and entered an order granting MAO’s request to redeem the Certificate. In arriving at this outcome the foreclosure court credited Defendants’ own certifications and the fact they had personally certified that the Property was “in substantial need of repair.” Regarding Zillow.com and the “Zestimate,” the foreclosure court noted that:

Market estimates such as those provided by Zillow generally assume a property does not require substantial repairs. Here, however, the Property is in need of substantial repairs and so the Zillow estimate cannot be said to be an accurate reflection of what a buyer with reasonable knowledge of the relevant facts would be willing to pay.

The foreclosure court thus held that the $150,000 value did in-fact constitute “fair market value for the Property given its stated[] current conditions,” and that permitting MAO’s redemption would best satisfy the interests of all parties, as it would allow NR to be made whole – as NR would receive the full value of the tax lien – and would also allow Defendants to remain in possession of their home for six months while planning how to start over, thus “breathing life into and supporting [the] old equitable maxim, ‘equity abhors forfeiture.’”

The appeal

NR appealed this outcome, arguing that the foreclosure court erred in accepting Defendants’ and MAO’s representations that fair market value had been paid. The Court disagreed, citing to the recently issued opinion of Green Knight Cap., LLC v. Calderon, 252 N.J. 265 (2022) and observing that this decision and recent amendments to N.J.S.A. 54:5-89.1 represented a “shift in [] jurisprudence” that now favors investors and recognizes a “less exalted view of tax sale certificate purchasers.” As to the specific proofs offered during the foreclosure proceedings, the Court held as follows:

Because the record reflects: [NR] admitted it was denied access to the interior of [D]efendants’ home; its Zillow Zestimate and tax assessment figures did not account for the poor condition of the Property nor the significant cost to renovate it; and no other competent evidence was presented to the judge to refute the fair market value figure presented by MAO, we discern no basis to second-guess the judge’s finding that $150,000 was the fair market value of the Property.

Based on the above quote, combined with the fact that a “judge is not precluded from considering reliable evidence of the value of real property absent expert proofs,” the Court affirmed the foreclosure court’s decision.


This opinion offers numerous important takeaways, chief among them the fact that expert testimony is not needed to demonstrate fair market value and that party certifications alone can be used to satisfy the standard. However, based on the language of the decision, it does appear that had one of the parties offered expert testimony in support of their position, party testimony alone would have been insufficient to rebut the expert. It also makes clear that online market estimates such as those commonly seen on Zillow.com, Realtor.com, and other various websites can be considered by the court in a limited capacity, despite the ambiguous nature of their valuation methods and accuracy. Recognizing that the foreclosure court is a branch of the New Jersey Chancery Division, the opinion also interestingly touches upon the idea that some measure of equitable consideration and balancing is inherent within every foreclosure decision.