30 April 2026
/ Scott J. Best
New Jersey Enacts Additional Asset Protections for Military Members, Spouses, and Veterans
On January 20, 2026, then Governor Murphy, as part of a flurry of legislative activity before leaving the Governor’s Office, signed the New Jersey Veterans and Military Spouses Asset Protection Act (the Act). The new law provides additional defenses and exemptions for those covered under the Act from post-judgment levies, garnishments, and the ability to force sales of property. The Legislature determined that due to the sacrifices made by veterans, active-duty service members, and their families enhanced creditor protections were necessary. The Act had immediate effect and applied retroactively to January 1, 2025, but only for debts incurred or claims filed on or after January 1, 2025.
Under the Act, certain assets of veterans, service members, and their spouses are given additional protections from creditors and their collection efforts. These new provisions are in addition to the protections afforded to military members while they are on active duty under the federal Servicemembers Civil Relief Act (SCRA), which include capping of interest rates, requiring court orders for repossession or foreclosure, delayed civil court proceedings, and limitations on the ability to enter a default judgment.
Under the Act, certain assets of veterans, service members, and their spouses are given additional protections from creditors and their collection efforts. These new provisions are in addition to the protections afforded to military members while they are on active duty under the federal Servicemembers Civil Relief Act (SCRA), which include capping of interest rates, requiring court orders for repossession or foreclosure, delayed civil court proceedings, and limitations on the ability to enter a default judgment.
The Act provides the following additional protections:
Real Property: New Jersey does not currently have a homestead exemption, but the legislature determined that a homestead exemption for those covered by the Act is necessary to “preserve stability, reward service, and strengthen communities”. In basic terms, the Act helps to protect a qualifying home from being forced into a sale to satisfy most personal debts, such as credit cards, student loans, or medical bills. The homestead exemption provided by the Act excludes the primary or secondary homes of veterans, service members or their spouses from levy or attachment for the payment of debts, judgments, or other claims or creditors. Critically, the Act does not establish a limit on the value of real estate or the amount of equity protected. These exemptions will continue to the surviving spouse of a veteran or military member if either the veteran or military member passes away.
Retirement Accounts: The Act also protects retirement accounts, pensions, disability benefits, and veteran’s service benefits of veterans, service members and their spouses by excluding those funds from levy in order to force payment of debts, judgments, or other creditor claims. There is no limit to the amount of funds protected.
Vehicles: The Act exempts one vehicle per household, up to $30,000 fair market value, from creditor claims.
Retirement Accounts: The Act also protects retirement accounts, pensions, disability benefits, and veteran’s service benefits of veterans, service members and their spouses by excluding those funds from levy in order to force payment of debts, judgments, or other creditor claims. There is no limit to the amount of funds protected.
Vehicles: The Act exempts one vehicle per household, up to $30,000 fair market value, from creditor claims.
The next, and perhaps equally important question is what is left unchanged by the new law? The government, of course, protected itself and any outstanding taxes or government exemptions are not covered by these additional protections. Similarly, and logically, debts incurred through fraud, crime, or willful misconduct are also excluded from the new exemptions.
Most important to many of our clients is that the Act does not prevent foreclosure by a lender on a valid and existing mortgage. Nor does the Act prevent repossession of a vehicle as the Act does not apply to voluntary liens placed upon the motor vehicle, which would include any lien a lender would have as a result of their secured interest in the vehicle granted at the time the loan was executed.
The penalties for violating the Act are significant in that any attempted levy, execution, or sale in violation of the Act will be void and unenforceable and may expose the creditor to additional liability under The Fair Debt Collection Practices Act (FDCPA) or other consumer protection statutes.
However, as with many laws that are quickly passed and signed, there are ambiguities and areas that will be clarified over time or through subsequent amendment. By example, there is no instruction on how the excluded vehicle fair market value is to be determined or who’s calculation controls. Similarly, the Act penalizes “attempted levy” but fails to consider that many creditors lack any information about the nature of funds in an account prior to levy.
Weltman will continue to monitor those changes, which are largely more procedural in nature, as the courts enforce the Act and will advise as necessary. If you have additional questions or would like to learn more about Weltman’s collection solutions, please connect with Philadelphia Attorney Scott Best at any time.
This blog is not a solicitation for business, and it is not intended to constitute legal advice on specific matters, create an attorney-client relationship or be legally binding in any way.
This blog is not a solicitation for business, and it is not intended to constitute legal advice on specific matters, create an attorney-client relationship or be legally binding in any way.
