For a lot of New Jersey home buyers, the down payment can be the biggest hurdle to buying a home. But it might only be a perceived hurdle. The truth is there are several mortgage programs available in New Jersey that offer low down-payment requirements.
Additionally, borrowers might be able to obtain gift money from a family member or borrower from a 401k. Those are just some of the ways you could buy a home in New Jersey with little to no money down.
Buying a Home With Little Money Down, Using FHA
House prices across New Jersey have risen steadily over the last few years. According to the real estate information service Zillow, the median home value for the state rose 5% over the last 12 months alone (ending in October 2017).
As a result, many home buyers in New Jersey are seeking ways to reduce their upfront, out-of-pocket expenses when buying a house. Some prefer to buy a house in New Jersey with little to no money down. Here’s how you might accomplish that goal.
Despite common misconceptions, you don’t necessarily need a down payment of 20% or more when buying a house in New Jersey. There are mortgage loans available that offer a much lower upfront investment.
The FHA loan program is one of those financing strategies that offers a low down payment. The Department of Housing and Urban Development (HUD), which manages this particular mortgage program, allows borrowers to make a down payment as low as ...
Visit NJ Lenders Corp. at booth #825 to vote for your favorite ‘retro’ candy and enter for a chance to win a $500 Amex gift card!
NJ Lenders Corp. is excited to announce our participation at the 2017 Realtors Triple Play Convention in Atlantic City, NJ December 5th & 6th. The Triple Play convention has helped bring Mortgage Brokers and Realtors together in an unmatched networking event.
As a premier year exhibitor, NJ Lenders Corp. will showcase our diverse and comprehensive capabilities that allows us to be one of NJ’s largest Retail Mortgage Bankers. But don’t let our name fool you! We are licensed in 7 states including New York, New Jersey, Pennsylvania, Connecticut, Virginia, Maryland, and Florida. Our mission is to produce competitive mortgage rates and fees while providing a level of service that exceeds expectations. With 26 years of experience, we are proud to serve over 60,000 homeowners.
The tax plan created by some members of Congress, and endorsed by the president, could change the way mortgage interest deductions work in New Jersey and across the nation. Here’s an update on the current rules for mortgage interest deductions in New Jersey, and the proposals that could potentially alter them in 2018.
Mortgage Interest Deductions in New Jersey: A Popular Tax Break
Mortgage interest deductions are a hot topic among home buyers and homeowners in New Jersey, and it’s easy to understand why. The average homeowner could save thousands of dollars per year by using a mortgage interest deduction. Nationally, they add up to approximately $70 billion per year, according to recent reports.
They are essentially a form of subsidy, through which homeowners can file a tax deduction for the interest they pay on their home mortgage loans.
Under the current tax law, homeowners in New Jersey and nationwide are allowed to claim a deduction for mortgage interest paid. These deductions can be applied to a principal residence as well as one additional residence. They are typically capped at $1 million for the first mortgage, and $100,000 on a second mortgage.
Change Could Reduce Number of Homeowners Who Benefit
The tax reform package supported by President Trump could change how mortgage interest deductions work in New Jersey, which is why some groups are opposing the change.
The Republican-sponsored bill would essentially cut ...
Home buyers in more expensive real estate markets, like some in New Jersey, often have to use jumbo mortgage loans when buying a house. Which begs the question: What is considered a jumbo loan in New Jersey? What’s the threshold or limit?
Depending on the county where you plan to buy a home, a jumbo loan might be anything above $424,100 or $636,150. See the next section for a county-by-county breakdown.
What Is a Jumbo Loan in New Jersey?
By definition, a jumbo loan is when the amount being borrowed exceeds the conforming loan limits used by Fannie Mae and Freddie Mac. These limits are established by the Federal Housing Finance Agency (FHFA0, which regulates Fannie and Freddie.
Loan limits are based on median home values, which means they can vary from one county and region to the next. When a person borrows more than these limits, it is considered to be a jumbo mortgage product.
So let’s get specific. What is considered a jumbo loan in New Jersey? Depending on where you live, the conforming limit for your county is either $424,100 for $636,150 (as of 2017). So a jumbo mortgage would be anything above those amounts. These are referred to as the “floor” and “ceiling” limits.
Here’s how it breaks down by county:
- Floor areas: The conforming loan limit is $424,100 in the following counties: Atlantic, Burlington, Camden, Cape May, Cumberland, Gloucester, Mercer, Salem and ...
This might come as a surprise to many borrowers. The latest industry reports showed that jumbo loan rates in New Jersey and nationwide were lower, on average, than the rates for smaller conforming mortgage loans.
In New Jersey’s pricier real estate markets, like those within the New York City metropolitan area, home buyers often have to use jumbo mortgage loans to finance their purchases. A jumbo loan is one that exceeds the conforming loan limits established by the Federal Housing Finance Agency.
Because there’s a higher amount being borrowed, you might think jumbo loan rates in New Jersey would automatically be higher than those assigned to smaller loans. But that’s not always the case. In fact, the opposite is frequently true.
New Jersey Jumbo Loan Rates Lower Than Conforming?
For many years, jumbo loans did in fact have higher average mortgage rates than their smaller conforming counterparts. But we saw a reversal of that trend a few years ago.
The latest Weekly Application Survey conducted by the MBA revealed a continuation of this seemingly counterintuitive trend. Mortgage rates for jumbo loans in New Jersey and nationwide were once again lower than the average rates assigned to smaller conforming loans.
Here are some trends identified in the MBA’s report from October 25, 2017:
- Conforming: The average mortgage interest rate assigned to 30-year fixed home loans ...