Closing costs are a big concern for New Jersey home buyers, because they represent an out-of-pocket expense that typically must be paid up front. There’s also a lot of confusion surrounding this topic. With that in mind, here are five things you should know about home buyer closing costs in New Jersey.
1. Typical closing costs and pre-paid expenses for NJ home buyers are 2% to 3% of the purchase price.
The finalized amount of closing costs a buyer pays in New Jersey can vary, due to a number of factors. Generally speaking, a more expensive home will result in higher costs. But that’s just one variable that can affect the amount you pay to close on your home.
As of 2017, home buyer closing costs in New Jersey tend to average somewhere between 2% to 3% of the purchase price. But they can fall outside of this range as well, in some cases.
New Jersey home buyers who buy a home for $400,000 with a 20% down payment pay approximatley $6,700 in closing costs (not including pre paid expenses). Prepaids are not a fee, but are costs associated with the home that are paid in advance when closing on a loan. These include Property Taxes, Homeowner’s Insurance, and Mortgage Interest that will accrue between the closing date and month-end. Property Taxes and Homeowner’s Insurance are collected to put into your Escrow Account so that you have enough reserves to pay these bills then they are due.But again, ...
Below, we’ve gathered some information about the real estate market in Bergen County, and added some helpful tips for home buyers. It’s must-read material for anyone planning to buy a home in Bergen County, New Jersey in 2017 or 2018.
Bergen County Real Estate Market Update
Home prices across the county have risen steadily over the last couple of years. And they’re expected to continue rising (to some degree) into 2018. That’s the first thing you should know about buying a home in Bergen County. If you postpone your purchase, you might encounter higher housing costs due to ongoing appreciation.
Granted, you should never make a home purchase until you’re absolutely ready. Just understand that house values in the county are expected to continue moving north over the coming months.
According to the real estate information company Zillow, the median home value for Bergen County rose to $456,100 as of October 2017. That was an increase of 4% from a year earlier. Looking forward, they are predicting additional but smaller gains for the next 12 months (ending in October 2018).
Here are some relevant statistics from the New Jersey REALTORS®:
Single-family detached homes: The median sales price rose from $490,000 in August 2016 to $507,000 in August 2017, according to the state’s Realtor association. The supply of homes dropped to five months this August, a 25% decrease from the same ...
Do you plan to buy a home in New Jersey in 2017 or 2018? If so, we’re willing to bet you have a lot of questions about the steps that occur along the way. And we’ve got you covered. Here is a step-by-step overview of the home buying process in New Jersey, updated for fall 2017.
Steps in the New Jersey Home Buying Process
To help you understand the buying process, we’ve broken it down into seven common steps. The process can vary slightly from one person to the next, due to the many variables that are involved. But it usually goes something like this:
- Establish your budget and research the market.
- Research and choose a type of home loan.
- Get pre-approved by a lender.
- Find an experienced New Jersey real estate agent.
- Begin the house hunting process.
- Make an offer and, if necessary, negotiate with the seller.
- Close the deal and get the keys to your new house.
Step 1: Determine your budget and research the market.
Before you start house hunting, do some basic budgeting math to determine how much you can afford to spend each month ...
For many home buyers in New Jersey, the down payment represents the single biggest obstacle to homeownership. But in some cases, it’s only a perceived obstacle. The truth is today’s down payment requirements for New Jersey mortgage loans are lower than most people realize. Here’s what you should know about it, as a home buyer.
A 20% Down Payment Isn’t Always Necessary
A 2016 survey conducted by the National Association of REALTORS® found that 66% of people thought they needed more than 20% for a down payment on a house. That’s a common misconception.
The truth is borrowers don’t necessarily need a down payment of 20% to buy a house. The average down payment among New Jersey home buyers is somewhere around 10%, and there are financing options available today that allow for an even smaller down payment. But a lot of people don’t realize this.
Home Loans With Lower Investment Requirements
Can’t come up with 20% when buying a home in New Jersey? You still have options. Here are some examples of financing strategies with a lower down payment requirement.
- Conventional loans with 3%: Fannie Mae and Freddie Mac, the two government-sponsored enterprises ...
When buying a home with a mortgage loan in Bergen County, it’s important to understand the various loan limits and how they might apply to you as a borrower. Here is an up-to-date explanation of Bergen County loan limits for FHA and conventional conforming home loans.
Bergen County Loan Limits in 2017 and 2018
Some mortgage programs limit the size of the loan that can be acquired or insured. These maximum amounts are aptly referred to as “loan limits.” They tend to vary by county, because they are based on home values that also vary by location.
Here are the current (2017) FHA and conforming loan limits for Bergen County:
- Conforming: For 2017, the loan limits for conforming (conventional) home loans were set. For a single-family home purchase in Bergen County, the conventional loan limits is $636,150 — the same as FHA. In other parts of New Jersey, the conforming limits are sometimes set lower at $424,100, as a result of lower home values.
- FHA: The limits for Federal Housing Administration (FHA) loans within the state of New Jersey range from $275,665 to $636,150. Since it’s located in one of the more expensive parts of the state, the Bergen County FHA loan limit ...